GLOBALIZATION AND POVERTY

Globalization and Poverty

Table of Contents

Introduction1

Discussion1

Positive Impacts of Globalization on Poverty2

Economic Benefits of Globalization4

Role of Multinationals in Reducing Poverty6

Negative Impacts of Globalization on Poverty7

Measuring poverty9

Globalization through Theoretical Analysis10

Conclusion11

Globalization and Poverty

Introduction

Globalization is the term refers to the process of integration of global economy marked by free capital flow, free trade and interconnectedness of all the people and countries around the globe. The increase in globalization has substantially reduced transportation and communication costs, and has brought the world closer. With the increase in the effectiveness of communication channel, it is now easier for the people to communicate regardless of their locations (Larsson, 2001). The concept of globalization is prevailing in the society which increases the importance of study of different negative and positive elements associated with it. Due to the fact that the term globalization is very broad and have multiple aspects, this paper will focus on a specific aspect in order to ensure the comprehension of the study. In this context, the following study will focus on the how globalization is affecting, altering and modifying poverty. Evidence suggests that there are mixed impacts of globalization on poverty. Some studies proved the role of globalization in reducing poverty, whereas, another school of thought believed that it increases it. Globalization is a new phenomenon and constructing any belief regarding its impact on poverty is perceived as immature perception. On the basis of already conducted research, this study will attempt to determine the impact of globalization on poverty.

Discussion

Poverty is the deprivation of food, shelter, clothing, money and basic needs. Globalization is sometimes perceived as beneficial and sometimes as a hindrance, especially when it comes to poverty. The poor people are found to be starving for the fulfillment of basic needs, as they find it difficult to make their both ends meet in their daily lives. Poor people throughout the world cannot afford better lifestyles nor do they have access to quality education. In accordance with the World Bank definition of poor; a person cannot be termed as poor, if through the income the person is unable to meet its daily necessities and live a healthy lifestyle. The World Bank estimated that around 1.8 billion of people all over the world are living absolute poor life. The lifestyles of poor people are extreme below the average lifestyle (World Bank, 2002). According to some researchers globalization at one hand jeopardizes the living standard; on the other hand it promotes inequality. However, opponents of the earlier stated pheromone claim that societies have become wealthier through integration of economies and the global trade which exposed people to the opportunities that help them enhancing their quality of life.

Positive Impacts of Globalization on Poverty

With the increasing integration among economies, the process of economic growth and development is enhanced (World Bank, 2002). According to Dollar and Collier (1999) developing countries can reduce their vulnerability to poverty through transition toward global markets. Transition towards global market will help developing and under developed countries to create better jobs, while it will provide ...