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Is globalization reducing poverty and inequality?

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on 20 December 2013

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Transcript of Is globalization reducing poverty and inequality?

means the growing integration of economies and societies around the world as a result of flows of goods and services, capital, people and ideas.
Waves of Globalization
1. The first wave
came to an end with World War I and the Great Depression
2. The second wave
from 1950 to 1980
3. The third wave
began in the late 1970s
How we might to think about the neglected subject of the political economy of statistic? And why we should to be concerned about probably – rising world inequality?
Is globalization reducing poverty and inequality?

What does liberal argument say about globalization?
The number of people living in extreme poverty worldwide is about 1.2 billion, it has fallen since 1980 by about 200 million.
world income inequality has fallen over the same period
positive trends in poverty and inequality have been driven by RISING INTEGRATION
What is the trend of income distribution*?
*income distribution is how a nation's total GDP is distributed amongst its population
combinations of measures
Alternative weightings of countries
Alternative measures of distribution
Alternative sources of data on incomes
Alternative samples of countries and time periods
Large margin of error
1. The
poverty headcount
is very sensitive to the level of the international

poverty line

2. The
poverty headcount
is very sensitive to the reliability of

household surveys of income and expenditure

China and India have PPP-adjusted income figures
that contain even bigger component of
guess work
than for most other significant countries

4. The often-cited
between 1980 and 1998
is not valid

Poverty line
is the minimum level of income deemed adequate in a particular country.

The common
international poverty line
has in the past been roughly $1 a day. In 2008, the World Bank came out with a revised figure of $1.25 at 2005 purchasing-power parity (PPP)
thank you
“…the satisfaction a person obtains from his income depends not on its absolute level but
on its relation to those of others in the same community at the same time.
If there is an increase in the level of income with no change in people’s relative position,
then nobody feels better off

Moses, Abramowitz, 1979
Globalization can be a powerful force for poverty REDUCTION
Globalization, inequality and poverty
all suffer from severe measurement and definition shortcomings.
Globalization is quite
recent phenomenon
World Bank's poverty numbers
probably make
the trend more rosier than it really is
Full transcript