Economic globalisation

Economic Globalisation promotes neoliberalism:

• Economic globalisation promotes the idea that the economy works better when left alone by national governments, being replaced by free market economies, and an unregulated market capitalism.
• Therefore, it is argued this delivers efficiency growth and widespread prosperity.
• This puts neoliberalism into place.
• This is where international organisations will impose neo-liberal policies on small countries, to give them financial aid.
• E.g. Senegal had to sign up to Structural Adjustment Policies.
• Therefore, the poor are exploited by international organisations enforcing neo-liberal policies in poor countries.

Economic globalisation arised after the Second world war, which resulted in the Bretton woods System and the Marshall Plan:

• This is because they adopted keynesiam, which aimed to deliver substantial growth.
• The globalised economy also devloped through the development of globalised capitalism.
• Neoliberalism has also contributed to economic globalisation, which expands the economy, through trade not war.

However, economic globalisation promotes neoliberal economic policies:

• This includes cutting taxes for the rich, shifting the tax burden on the poor.
• Such policies are promoted by liberal institutions, such as the IMF and the World Bank.
  • They lend money to countries in debt, such as Senegal, and in return, that govt must introduce neo-liberal policies.
  • E,g, Indonesia had to borrow money from the World Bank, and had to adopt neo-liberal policies in return, leaving the poor to pick up the pieces- no education or healthcare provided for them.

However, it could be argued that economic globalisation:

• Can make the poor less poor.
• This is because of international trade, which allows states to produce goods of their speciality, and export them.

Despite this, it could be argued that it makes them less poor, as in Senegal, their speciality got taken away.

The positives of economic globalisation include:

• Neo-liberalism expands the economy, through trade, which creates more job oppourtnities for the people.
• This leads to prosperity as states are able to export their goods to other states, that they were not able to export to before, without international trade.
• Therefore, the poor are able to evolve as their job opportunities and education will be expanded as a result.

However, economic globalisation has been criticised because:

• Neo-liebral economic policies  have been criciticsed because, instead of making the poor richer, they have made them poorer, as the tax burden is placed on them.
  • Also due to neo-liberal policies, national services are cut, meaning the poor are not able to get an education or decent healthcare, meaning the only jobs available to them, are cheap labour.
• Another criticism is that free trade promotes neoliberal globalisation, which protects access to lucrative offshore market, including cheap labour.
• E,g, States such as Indonesia, people work long shifts in factories producing goods, for a very low wage.
• Whilst the business owners and share holders recieve a huge profit as a result.