International Trade or Technology? Who is Left Behind and What to do about it

  • 1 University of California, Berkeley, Haas School of Business, s545 student services building, Berkeley, USA
Ann Harrison
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  • University of California, Berkeley, Haas School of Business, s545 student services building, Berkeley, USA
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Abstract

We examine globalization’s effects on those left behind in both industrial and emerging markets. While access to global markets has lifted billions out of poverty in emerging markets, the benefits have not been equally shared. Increased competition through globalization as well as skill-biased technical change have hurt less educated workers in rich and poor countries. While much of the rising inequality is often attributed to globalization alone, a brief review of the literature suggests that labor-saving technology has likely played an even more important role. The backlash has focused on the negative consequences of globalization in developed countries, and now threatens the global trading system and access to that system for emerging markets. We conclude by proposing some solutions to compensate losers from the twin forces of technical change and globalization.

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The Journal of Globalization and Development (JGD) publishes academic research and policy analysis on globalization, development and the complex interactions between them. It is dedicated to stimulating a dialogue between theoretical advances and rigorous empirical studies to push forward the frontiers of development analysis and seeks to combine academic insights with the in-depth knowledge of practitioners to address important policy issues.

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