The Debate Heard Round the World

Does globalization have an impact on poverty?

The world is changing with each blink of an eye and everyone has an opinion on the way things change. Currently, a polarizing topic is globalization and its relationship to poverty. In the past, developing countries, such as some of the places in Latin America, Africa, and Asia, isolated their economies from the rest of the world. This held until the 1970’s and 80’s, when they finally opened their market to the world. Many countries that opened their markets saw a significant increase in Gross Domestic Product (GDP) following the change, but what does that mean for the poverty rate in these countries?

Anti-globalizers take a strong stand, claiming that globalization only helps those who are already well off. They believe it makes the rich richer. They point out the sweatshops popping up in the developing world, dominated by masterminds in the developed parts of the world. In their eyes, globalization gives powerful countries an outlet to dominate those that have less power. Globalization could not possibly help developing countries because they are not the countries that run the market. However, this is not the only view on this issue.

Others flip the situation around, looking at the market expansion and GDP growth as things that decrease poverty as a country’s wealth increases. While they are aware that sweatshops are not the ideal working conditions, they note the increase in jobs in a given country. Sweatshops provide jobs to people who were either previously unemployed or in even worse labor conditions. A country’s increasing GDP gives them more resources to help the impoverished. However, this assumes that the country is indeed using its new resources for such a just purpose.

Overall, poverty has decreased as globalization increases. But this is correlational, not causational. While this change is undeniable, globalization is not the only thing that has been changing over the years. Each country differs in internal policy, international policy, and so much more. None of these things have remained completely constant over the years; therefore, there are many factors that could also be considered the cause for a decrease in poverty. While globalization impacts the economy and is very likely to have a relationship with the declining poverty rate, the exact connection between these things cannot be completely fleshed out. Arguments may never cease on this issue, as it is very possible that globalization hurts the impoverished in some ways and helps them in other ways.