Accelerated in the modern era by computing power, satellite technology and the efficiency of container shipping, globalisation has drawn attention to itself on account of its far-reaching consequences.
In particular, the economic benefits of greater international trade and investment tend to be distributed unevenly. Concerns about global inequality, especially since the financial crash of 2008, portray globalisation as a zero sum game, in which the winners in our interdependent world may gain their prosperity at the expense of the losers.
This negative perspective points to the loss of traditional factory jobs in US and Europe, undercut by low wage economies led by China. It might equally point to the failure of African agriculture to modernise, its more promising crops undercut by imports from US and European farmers, whose government subsidies might have been blocked in a fairer global trade regime.
Meanwhile, the economic opportunities presented by globalisation have been optimised in Southeast and East Asia where many countries have achieved the dual goals of eliminating extreme poverty and facilitating a dynamic business environment. The capital-owning classes in the West are also seen as winners of globalisation, enjoying real increases in asset values in spite of, or possibly even as a consequence of the banking collapse of 2007/8,
However, the broad international picture sees most low income countries as falling behind. Despite the rise in foreign trade and investment over the last thirty years, the number of people living in extreme poverty in sub-Saharan Africa increased by 113 million between 1990 and 2013, the most recent year for which reliable data is available.
Whereas internet technology has revolutionised our capacity for knowledge and interaction, swathes of South Asia and Africa provide no electricity, let alone computers. Whereas the global supply chains of our supermarket culture deliver exotic year-round affordable foods, over 800 million people in the developing world experience hunger.
For a long period, the post-1945 growth in prosperity ensured that the economic tools of globalisation enjoyed mainstream political support. Now, those comforting theories that rising wealth “trickles down” or “floats all boats” are losing credibility, whether between richer and poorer countries or within a single country.
Contemporary globalisation is therefore blamed for the unaccustomed stagnation of living standards amongst large sections of European and North American societies. Although many economists challenge this analysis, pointing instead to the role of new technologies and the absence of adequate retraining programmes or welfare safety nets, the political backlash against labour migration and free trade holds up the mirror to public opinion.
more Globalisation briefings (updated December 2017)
International Development Model
Globalisation and Environmental Limits
Globalisation and Migrant Workers