Is globalization all it is cracked up to be?

Abstract

Many of the world's population have gained from the globalization of product markets. At the same time the numbers living in absolute poverty have remained stubbornly large and inter- and intra-country income distribution has worsened as globalization has proceeded. Two outcomes to globalization are analysed - a positive-sum 'blue scenario' of full employment and effective redistributive mechanisms, and a 'red scenario' of a growing global reserve army of skilled workers, and the weakness of political processes favouring redistributive mechanisms. The conclusion is that the negative-sum red scenario is the most likely outcome of the unequalizing tendencies of globalization. The role which China plays in the creation of this global reserve army of labour - especially of skilled labour - is given particular attention.