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Summary of The Power of the Pill: Oral Contraceptives and Women’s Career and Marriage Decisions, by Claudia Goldin and Lawrence F. Katz (Part 3)

February 23rd, 2009 Comments off

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States with more lenient regulations about regarding minors had greater pill use by young unmarried women. Pill use was 33-35% greater for 15-19 year olds in less restrictive states. 36-40% greater for 17-19.

Table 3

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II. Frameworks to Understand the Effect of the Pill on Marriage and Career

1) There are two routes by which pill diffusion among young, single women could have affected career decisions: direct and indirect.

2) Direct Effect: The pill causes a reduction in the cost of marriage delay, and thus increase the value of a career; women with greater career potential become more attractive marriage partners. The pill is an unequivocal benefit to men; on average, it benefits women, but the group of women who would otherwise without the pill have married without a career lose out because they are sometimes matched to worse partners.

3) Indirect effect: The pill lowers the cost of a career through the marriage market. It thickens the marriage market for those who delay marriage and also leads to better matches for career women and some others.

a. An increase in the number of women who delay marriage, which the direct effect explains, has no effect on the decisions of other women.

b. A “social multiplier” effect is feasible: The pill produces a new equilibrium in which marriages are later, careers are more numerous, and matches are better as a result of couples not being pressured to marry too early. One possible theoretical implication is a reduction in the divorce rate.

4) This framework shows how the pill altered women’s career and marriage decisions. Up-front and intensive career investments are difficult for women with children, so the pill effectively removes this difficulty for women who want to engage in sexual relationships. Besides affecting careers, the pill, as an extremely effective contraceptive method, altered the marriage market. No longer was sex required to be packaged with commitment mechanisms, whether it was “going steady” or getting “engaged,” where if pregnancy occurred, the couple would follow up with marriage.

5) Central empirical predictions of this framework are that an increase in pill dissemination should be accompanied by an increase in professional careers for women, age at first marriage, and age at first birth. Predictions about divorce are ambiguous; while the pill should result in better matches, increased career prospects for women outside marriage, decreased division of labor in the home, and the greater likelihood of fewer children could all increase divorce rates.

III. Evidence for the Power of the Pill

A) Time Series: Career Investment, Marriage, Sex, and Fertility Expectations

1) Career Investment

a. Relevant careers to study are those that require extensive up front education, such as law, medicine, dentistry, and business administration.

b. Time-series data on professional schools is in two forms: as a share of women receiving a bachelor’s degree in the same year and as a share of total first-year enrollments in professional schools.

c. The fraction of female BAs entering law and medical schools began a steep climb around 1970. This increase peaked after approximately one decade.

d. In 1960, the fractions of women to all students in medicine, law, dentistry, and business administration were .1, .04, .01, and .03 respectively. In 1980, they were .3, .36, .19, and .28. This resulted in a large increase in women’s presence in those career fields in the following decades. The percentage of female lawyers and judges was 5.1 in 1970, 13.6 in 1980, and 29.7 percent in 2000. For physicians, it was 9.1, 14.1, and 27.9. Similar patterns followed for other professional occupations.

e. In the case of medical students, the change in career decisions of young women in 1970 did not result from a greater fraction of female applicants being admitted, but an actual increase in the number of female applicants.

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Summary of The Power of the Pill: Oral Contraceptives and Women’s Career and Marriage Decisions, by Claudia Goldin and Lawrence F. Katz

February 23rd, 2009 Comments off

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Harvard University and National Bureau of Economic Research

Central Question: Did the birth control pill and the legal environment that enabled young, unmarried women to obtain “the pill” alter women’s career plans and their age at first marriage? Answer: They did.

Methodology:

– Focusing on women’s age at first marriage and career changes, Katz and Goldin examine the differential effects of legal changes at important points in time and in different states.

– Legal changes in different states at different times not only lowered the age of majority, but also extended the rights of minors relating to parental consent for dispersion of non-emergency treatments, which included contraceptives.

– After establishing that pill diffusion among young and unmarried women was at least partially caused by legal changes, K&G show the relationship between pill use and age at first marriage and career investment by analyzing cohorts of women born 1921-1960. Alternative explanations, such as anti-discrimination laws, liberalization of abortion policy, and feminist influence on culture are also considered.

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Summary of The Power of the Pill: Oral Contraceptives and Women’s Career and Marriage Decisions, by Claudia Goldin and Lawrence F. Katz (Part 6)

February 23rd, 2009 Comments off

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But actual marriage rates contradict this prediction.

3) Feminism: The most difficult supply side explanation is the resurgence of feminism; the empowerment of women to see themselves as equal to male peers prompted them to aim for different life paths, which included careers. A demand-side explanation can also be offered, with employers desiring female employees more, which include sexual discrimination legislation and the ending of Vietnam war draft deferments. However, anti-discrimination legislation came too late after the pill to account for changes; further, medical and dental schools should have seen a surge in male applicants in 1973 (the end of the draft) that would have squeezed out female applicants, but the upsurge in female applicants began around 1970. Lastly, the demand-side explanations fail to account for other related changes, specifically the rise in sexual activity among single women in 1970.

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Summary of The Power of the Pill: Oral Contraceptives and Women’s Career and Marriage Decisions, by Claudia Goldin and Lawrence F. Katz (Part 5)

February 23rd, 2009 Comments off

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Column 4 mirrors column 2, except the abortion law variable is replaced by a continuous measure, abortion rate in an individual’s state of birth when the individual was 18-21. The estimates show a large negative and statistically significant impact. Changes in access to abortion can explain a 2.6% decrease in the fraction marrying by 23 from the pre-1949 to the 1957 birth cohorts. The continuous measure reduces the magnitude and significance of the abortion law dummy.

e. Column 5 shows that the inclusion of state of birth linear time trends restores the significant effect of birth control access, and the abortion rate effect becomes small and insignificant.

f. Columns 6 and 7 include dummies for earliest age of legal access to birth control for each state of birth and year of birth group. Pill access by age 17 has a significant negative effect on the dependent variable in models including and not including state of birth trends and abortion access controls. Column 8 preserves these results, even when the sample is expanded to contain all women with at least one year of college.

g. Column 9 shows significant negative effects of pill access by age 17 and 18-20 on marriage by 23 when the sample contains all with at least some college.

2) Career and Marital Status Outcomes: Aggregate Cohort Analysis

a. Lacking an ideal data set containing information on pill access and usage, educational investments, and life cycle career attainment and medical status, Katz and Goldin rely on an aggregate cohort analysis based on U.S. population censuses from 1970, 1980, and 1990.

b. Analysis: unit of analysis is age/year cell; 20 age groups (30-49) across three census years, yielding 60 observations and covering 1921-1960 birth cohorts of college graduate women born in the U.S.

c. Regression: Share of age group a experiencing a particular career or marital status outcome in year t age dummies census year dummies race controls measure of access/usage of birth control as young women measure of access/usage of abortion as young women.

d. The intuition for the specification is to observe successive cohorts at the same ages and see whether changes from one cohort to the other in pill and abortion access had a relationship to changes in career and marital status.

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IV. The Case for the Power of the Pill

1) Despite the 1960 approval of the pill by the FDA and its rapid spread among married women, legal barriers prevented young, unmarried women from using the pill until the late 60s to early 70s

2) The lowering of the age of majority and increase in the rights of minors played a key role.

3) More lenient laws led to greater use of the pill, directly producing an increase in the age at first marriage and the fraction of women entering professional schools (and hence entering professional careers).

V. Alternative Explanations

1) Abortion: oral contraceptives had a far wider effect than abortion. College women did not depend on abortion as they did on the pill for safe, effective, and painless contraception.

2) Changes in the sex ratio (the ratio of men to women of marriageable age): the ratio may affect female marriage rates and incentives to invest in careers. Since women typically married men 2-3 years older, women born early in the baby boom should have faced poorer marriage market conditions than did those born later.

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Summary of The Power of the Pill: Oral Contraceptives and Women’s Career and Marriage Decisions, by Claudia Goldin and Lawrence F. Katz (Part 4)

February 23rd, 2009 Comments off

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Fig. 4.—First-year female professional students as a percentage of female B.A.’s (panel A) and as a fraction of first-year students (panel B). Source: B.A. degrees: U.S. Department of Education (1998), table 244. First-year medical students: Journal of the American Medical Association (various years 1978–98). First-year law students: American Bar Association web site (http://www.abanet.org/legaled/femstats.html). First professional degrees in dentistry: U.S. Department of Education (1998), table 259. Earned degrees in business: U.S.Department of Education (1997), table 281. Note: Data for first-year dental and business students are derived from first professional degrees lagged four years for dental students and three years for business students. The data, for years of overlap, are similar to those for first-year students from Students Enrolled for Advanced Degrees (U.S. Department of Health, Education, and Welfare, various years). The procedure, moreover, produces values similar to those for medicine and law for which the first-year student time series exists.

2) Age at First Marriage, Sex, and Fertility Expectations

a. 50% of those born 1941-1949 married before age 23 (median college grad age is 22 years). After 1949, this fraction dropped. For those born 1957, the fraction married before 23 was 30%.

b. Examining registration cards for Harvard University Law School for entering classes 1962-1975 in light of the tradition of adopting the male’s last name after marriage, the fraction married at the time of law school graduation from 1964-1966 was about the national average, but from 1970-1972 was one-third the national average.

c. Evidence of sexual activeness is consistent with timing of pill availability, with sexual activity for women under 20 years increasing with cohorts born after 1947.

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Fig. 5.—Fraction of college graduate women married before various ages. Source: Current

Population Survey, Fertility and Marital History Supplement, 1990 and 1995. Threeyear

centered moving averages are shown.

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Fig. 6.—Fraction of never-married women having sex before various ages. Source: All

but the solid markers: Inter-university Consortium for Political and Social Research (1985).

Solid markers for birth cohorts of 1952, 1953, and 1954: Zelnik and Kantner (1989). Solid

markers for birth cohorts of 1957 and 1958: Inter-university Consortium for Political and

Social Research (1982). Three-year centered moving averages are shown. Solid markers,

of the same shape as the open markers, give the values for contemporaneous data.

B) Formal Econometric Analyses: Marital Status and Professional Career Outcomes

1) Age at First Marriage and State Law Changes in Pill Access

a. Regression: Married before 23 dummy race state restrictive birth control law at time when obs. was 18 dummy abortion legal when 18 state of birth dummy year of birth dummy

b. To compensate for possible endogeneity of birth control access to state feminist attitudes, controls for state of birth linear time trends are included. However, the states providing minors access to birth control without parental consent were so wide ranging that it’s more likely that idiosyncratic factors affected the passage of such laws instead of the strength of the women’s movement in those states.

c. Regression Results: Column 1 indicates that the adoption of non-restrictive birth control laws for minors was connected to a statistically significant but small (2 percent) decline in the probability that a college graduate woman was married before age 23. Column 2 shows similar effects on probability of marriage before age 23 between birth control and legalization of abortion. Column 3 demonstrates that the observed effect of access to birth control is consistent with (and even slightly augmented upwardly by) controlling for state of birth linear trends; the same, however, is not true for the abortion law variable.

d.

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Globalization, Growth, and Poverty (a summary of the 2001 World Bank report)

July 4th, 2008 Comments off

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The following is my summary of a World Bank report published in May 2001 giving us the expected statist rundown of globalization: yeah, it’s good, but the state needs to play an ever-more-important role! Hopefully this summary will be useful to anyone else forced to read this boring and academically cliche journey through college-student moderate politics.

Globalization, Growth, and Poverty: Building an Inclusive World Economy

Reduced transportation costs, lower trade barriers, speedier transmission of ideas, pressure for labor migration, and increasing capital flows have all led to greater integration among economies and societies internationally, a phenomenon that has come to be labeled “globalization. ” While globalization is a major force propelling poverty reduction in the modern world, some concerns have been raised about increasing economic inequality, transfers of power, and cultural uniformity. The policy research report entitled Globalization, Growth, and Poverty: Building an Inclusive World Economy released by the World Bank in 2001 examines the influence of this globalizing force and the anxieties caused by it, serving as a summary of World Bank research into the topic and providing a policy agenda for harnessing globalization to positively augment opportunities for the poor and to offset its potential hazards.

The report is divided into five major areas. Chapter 1 explores the economic effects of the new wave of globalization, examining them in light of the effects of earlier periods of globalization and their subsequent reversals. Chapter 2 focuses on global policy agendas for trade, financial infrastructure, and migration. Chapter 3 concerns itself with the agenda of globalizing economies to integrate into world markets, investigating institutional arrangement and policies to facilitate integration. Economic issues aside- poverty, income distribution, and policies- Chapter 4 examines apprehension over issues of power, culture, and the environment. Finally, in accordance with the study’s findings, Chapter 5 proposes the World Bank’s agenda for action aimed at making globalization more beneficial, particularly for the poor and those marginalized by globalization.

Ch. 1: The New Wave of Globalization and Its Economic Effects

Economic integration can be thought of as having three components: trade, measured in the report as relative to world income; migration, using immigration to the United States; and capital flows, represented by the stock of foreign capital in developing countries as a proportion of GDP. From 1870 to 1915, falling costs of transportation propelled these figures to an important level. Mid-19th century changes from sailboats to steamships and reduction in trade barriers facilitated by an Anglo-French agreement triggered the first wave of globalization. Improved transportation and the elimination of political trade barriers resulted in the exchange of land-intensive primary commodities for manufactures and the doubling of exports as a fraction of world income to 8%. Labor became a necessity for these commodities. Sixty million people migrated from Europe to North America and Australia to work on the newly-accessible land, and some scholars speculate that “South-South” migrations (from China and India to southeast Asia, for example) were of the same magnitude, making labor flows during this period a grand total of 10 percent of the world’s population. Capital was also necessary; while in 1870, the foreign capital stock in developing countries was 9%, by 1914 it had grown to 32%. As a result, the rate at which per capita income increased each year had risen from 0. 5% to 1. 3%. Economic forces created an increasing convergence between globalizing countries; wages increased in the emigrant countries (particularly of Europe), while wages decreased in immigrant countries (America, Canada, etc. The overall impact of these changes on equality within individual countries was a function of the distribution of land ownership, as the benefits of primary commodity trading would accrue to land holders.

Despite the fact that transport costs continued to fall from 1915 to the end of the Second World War, globalization froze as trade barriers rose in response to nationalistic demands worsened by the First World War. Following 1945, new international cooperative efforts proceeded to reduce protectionism, reviving trade and producing a second wave of globalization much like the first, particularly among rich countries. The General Agreement on Trades and Tariffs (GATT) was formed to restore trade relations multilaterally. However, many developing countries were specialized only in primary commodity exporting and were left out of newly opened capital flows, albeit because of their own protectionist policies. The poorest industrialized countries grew the fastest, and while growth in developing countries recovered from the period of the two World Wars, they did not grow as quickly, resulting in a widening of the gap between rich and poor countries. As for income distribution patterns, the number of poor people increased (because of increased life expectancy and hence population growth), but the distribution of income among developing countries was only slightly affected.

Since 1980 an unprecedented level of global economic integration has taken place. “New globalizers” – a set of developing countries – have entered world markets for manufactured goods and services. The average composition of exports from developing countries, for example, has changed from 25% manufactured goods in 1980 to over 80% today. Foreign direct investment has vastly increased, particularly among countries like Brazil, Mexico, Hungary, India, and China. The general trend has been that some low-income countries formerly focused on primary commodities have become more competitive with high income countries for all types of goods and services. On the other hand, a group of less developed countries with approximately 2 billion people experienced an overall negative growth rate in the 1990s, becoming increasingly marginalized. Some concerns have also been raised about global integration causing rising inequalities within countries, but the report finds that this is not the case. At the same time, since 1980 the absolute number of poor people has stopped increasing and has decreased by 200 million, falling rapidly in the new globalizers and increasing in the remainder of the developing world. Overall, however, world inequality has stopped falling and has even possibly begun to decrease.

In light of these globalization experiences, particularly the most recent one, the study concludes that globalization can strongly reduce poverty. The non-globalizing countries of Africa and the Former Soviet Union (FSU) depend highly on primary commodities and have failed to participate significantly in globalization. Their marginalization is most often attributed to three things: poor policies, infrastructure, institutions, and governance; intrinsic geographic and climate disadvantages; or, as a fusion of the first two, that a temporary phase of poor policies has caused certain countries to be left out of major economic agglomerations. The report suggests the strategy of “opening up with the necessary complementary actions [of policies, institutions, etc. while building the global coalitions needed to address the deep-seated structural problems that face many countries. ”

Ch. 2: Improving the International Architecture of Integration

The international architecture for economic integration- i. e. tariffs and other trade barriers- has experienced change during each of the waves of globalization, but it has particularly done so in the most recent wave. Over the last 20 years, many developing countries have eliminated their restrictions on imports, but they now face protectionism from rich nations. Rich countries have low tariffs, on average, but retain trade barriers in agriculture and labor-intensive manufactures- areas in which developing nations have a trade advantage, whose protection by rich nations costs them over $100 billion.

However, developing countries have barriers three times higher than those in OECD countries. Because developing countries trade with each other far more than they did in the past and 70% of tariff barriers on their exports come from other developing countries, a “development round” of trade liberalization would be significantly gainful by improving access to new markets, both rich and developing. Despite this, protectionist interests in Northern developed countries present opposition to such changes, effectively using institutional trade agenda issues such as intellectual property, health and labor standards, and environmental issues as prerequisites for barrier reduction. The report argues that many of the developing countries in question are in fact improving labor conditions and environmental policies, but that the threat of trade sanctions from the WTO is only destructive to those ends.

Foreign investment relates closely to trade liberalization issues. Private capital flows have vastly increased, especially as developing countries have lowered restrictions on foreign direct investment (FDI), bringing an increased supply of capital and better access to technology, management, and markets. While the new globalizers have experienced these gains, the least globalized countries have experienced capital flight. Poor locations that have not improved much from globalization have created a demand for more well-managed aid from rich countries.

The third main global flow, migration, is also subject to structural improvement. Economic pressures for migration are resisted by legal restrictions on migration. Compared to a century ago, labor flows are not as globalized: only 2 percent of the world’s population is composed of non-citizen residents. Meanwhile, OECD labor forces are aging and retiring, putting strain on social security systems, while developing countries’ labor forces are growing rapidly because of high birthrates. There exists a potentially great mutual economic benefit achievable by combining capital and technology of developed countries with the labor resources of developing countries. Nonetheless, geographic limitations prevent (or will at least delay) capital flows and trade from eliminating migration. Wide divergences in quality of institutions and infrastructure keep production opportunities where their quality is high, and make production less attractive when their quality is low.

Migration can be a net positive factor for two nations, as evidenced by the experiences of the United States and Mexico. Individual migrants from Mexico to the U. S. for example, made $31 per week in Mexico on average, and could move to the U. S. and immediately begin earning $278 per week. Their migration to the U. S. has also taken pressure off of the Mexican labor market, raising wages there, as well as increasing money remittances. The U. S. has also benefited from this arrangement; the labor inflow was partly responsible for sustained growth and low inflation in the 1990s. Overall, OECD countries like the U. S. tend to have discriminatory policies toward immigrants, particularly biased in favor of educated workers, resulting in “brain drain” from developing countries. The report suggests that migration would reduce poverty more effectively if immigration policies were less discriminatory and permitted more unskilled labor flows.

Ch. 3: Strengthening Domestic Institutions and Policies

While trade policies are important to integration, other institutions and policies play a key role (even if they are not specifically catered to international commerce).

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Globalization, Growth, and Poverty (a summary of the 2001 World Bank report)   [Part 2]

July 4th, 2008 Comments off

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Globalizing countries face many common issues, but can approach them with different policies and institutional arrangements for coping with them. For example, China, India, and Mexico have employed different strategies. Two of the most important issues requiring attention are the globalizing nation’s investment climate and its social protections for workers.

Because open economies confront greater competition, the year-to-year levels of entry and exit of firms (“churning”) are much higher than in more closed economies. Data on Chile, Morocco, and Colombia shortly following liberalization have shown that one-fourth to one-third of manufacturing firms experienced turnover in a four-year period. Some evidence has shown that it is unlikely for manufacturers to shift from domestic production to exporting, thus requiring the creation of new firms and the destruction of old firms for entry into world markets.

Case studies have demonstrated that firms in developing countries are capable of being competitive, but are frequently hindered by a weak investment climate caused by inefficient regulation, poor infrastructure, and deficient financial services. States calculated to have a good investment climates receive both more domestic and foreign investment. Coastal China and northern Mexico are two examples in which a good investment climate has been achieved (also resulting in major poverty reduction). Many of the nations left out of the global economy in the 1990s tended to have property rights and other general investment climate issues.

Because of the “churning” caused by increased competition, labor market turnover – one of the most disruptive characteristics of a global economic integration has also grown. While workers gain in the long run, as evidenced by wages growing twice as fast in the more globalized group of developing countries than in those less so, short-run effects are often different. An economy that liberalizes trade could experience a drop in formal sector wages, due to either a bad investment climate or because of lagged investment response.

Globalization inevitably creates winners and losers, and some of the most important losers in the present are former workers of now-churned protected industries. The report suggests that social protection and labor market policies are essential for not only the immediate welfare of these workers and others, but for the long-term welfare of all workers. Unemployment insurance and severance pay can help with high turnover. These protections can help the poor engage in the risk-taking of entrepreneurship. Additionally, a well-educated labor force produces general improvements in welfare.

I

Ch. 4: Power, culture, and the Environment

Though the economic factors above play a large role in attitudes toward globalization, much of the anxiety about it is caused by issues of power, culture, and the environment. According to a poll of 20,000 people in 20 countries (including Braizl, China, India, and Nigeria), two in three people reported that they thought that globalization would “materially benefit their families,” but over half of the same sample reported that globalization threatens their nation’s culture, and a significant portion of them expressed a belief in a need for greater international control over worker rights, human rights, and environmental issues.

While the United States is the largest (in output) economy and often regarded to be the most successful in the world, it is not the only successful model. Some economies are near or exceed the U. S. ’s income per capita, but have different policies and income distributions. These economies include Austria, Belgium, Japan, Norway, and Denmark. In light of that, the report argues that there is no ultimate model of or fixed formula for success.

Successful globalization, the report states, usually makes the state larger, though it renders some policy tools ineffective. Globalization has a tendency to weaken monopolies, since national monopolies are faced with competition from foreign firms. However, there are some cases in which firms can attain a temporary global monopoly or oligopoly, posing a difficulty for national anti-trust laws. Globally, trade has also begun to conform to a legal framework, which may potentially benefit weaker countries, but there are concerns that the rules may benefit the stronger nations instead. One example are the vastly different interests regarding intellectual property in rich and poor countries: while the former favors keeping it a private good in order to reward innovation, the latter desires to keep it as a public good.

It has been speculated that globalization could result in a “race to the bottom” of environmental standards, but this phenomenon has not made itself evident. A study of the new globalizers showed that air quality had increased in major industrial centers. Through transfers of knowledge communities are able to share methods of combating pollution. On the other hand, poorer nations typically have problems enforcing environmental standards because of strong vested interests.

Some groups in rich nations have suggested that environmental regulations be enforced through WTO sanctions, but risk of the sanctions being captured by protectionist lobbies could potentially be used to the detriment of poor nations’ opportunities. Still, some environmental issues, like global warming, will require global policing. Seven economies account for 70 percent of the world’s carbon dioxide emissions. Because each of these countries is hesitant to proceed with reduction because of the potential for others to free-ride on the benefits, collective action such as in the Kyoto protocol are important steps in addressing global warming.

Ch. 5: Agenda for Action

Globalization has been a strong force of poverty reduction, narrowing the gap between many rich and poor countries.

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Globalization, Growth, and Poverty (a summary of the 2001 World Bank report)   [Part 3]

July 4th, 2008 Comments off

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Despite this, globalization remains to be more effective for poor people and have its adverse effects mitigated. Global policy has failed to keep up with the opportunities and dangers of globalization. Attempting to avoid “nationalism, protectionism, and anti-industrial romanticism,” the report proposes an agenda for making globalization more effective and universal, emphasizing seven in particular aimed toward benefiting the poor.

The first area of action should be in a “development round” of trade negotiations, primarily centered on market access. Rich countries continue to maintain protectionist policies in markets in which developing countries have comparative advantages. Developing countries also have high barriers between themselves, higher on average than those of developed nations. Subsumed under this is that labor and environmental standards should not be imposed on poor countries, as without the proper resources, such measures can actually lower standards of living and have an overall adverse effect on welfare. Generally, trade agreements should allow for different institutional goals and solutions to environmental standards, social protections, cultural preservation, etc. Economic integration need not interfere with institutional and cultural diversity.

Next, improving the investment climate in developing countries is an important goal. Open trade and investment policies do not yield many benefits in context of bad policies, reflected by the fact that the most prosperous developing countries during the recent wave of globalization have been those that have established good investment climates for firms to be established and expanded. Improving the investment climate is not to be mistaken for tax breaks and subsidies for firms, but rather general economic governance, including control of corruption, efficient bureaucracy and regulation, contract enforcement, and respect and protection for property rights. Also, maintenance of local and global market access via transportation and communications infrastructure is key.

The report’s third prescription is the delivery of health services and education. Global integration raises returns on education, but with poor social services, inequality and extreme poverty can be exacerbated. Education, health, and a good investment climate are critical for giving the poor the chance to participate in an expanding economy. Closely related is the solution to the problem of “churning” in labor markets, which create temporary losses for many groups of people. Hence, the fourth area of action lies in the provision of social protections geared toward a more dynamic labor market, helping individual short-run losers to globalization and giving a solid foundation for poor households to engage in the risk-taking activities of entrepreneurship.

A new approach to foreign aid constitutes the report’s fifth recommendation. When reforms and social services alter the investment climate, private investment usually has a delayed response. Large-scale aid programs work in this context. Financial support can assist societies making troublesome changes, or for addressing geographic and demographic challenges that can not be met by policy changes. Also, debt relief constitutes a considerable part of aid, but is different in some ways from other forms of aid, making it the report’s sixth recommendation. Many of the aforementioned countries who have been marginalized by the process of globalization are saddled by high debts, particularly in Africa. Especially when combined with policy reform, lowering the debt burdens of these countries can make a significant difference in poverty reduction.

Lastly, the report argues for the importance of dealing with the problems of greenhouse gases and global warming. The report contends that though there is a broad scientific agreement over the issue, there is a lack of effective global cooperation to solve it. The environmental effects of global warming are also expected to be especially borne by poor countries and poor people if they remain unaddressed.

The report is also a piece of shit, but go figure. If you’re in school, you might have to deal with it.

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