Globalization On Poverty And Inequality
The rate of children participation in the labor force could be considered as a measure of inequality and poverty. As Lindert and Williamson (2003) argued that trade openness could lead to higher income per capita and if the income is large enough then parents will have less incentive for sending their children to work. In addition, globalization brings foreign direct investment to developing countries that will lead to new legal frameworks that prevent children from participate in the labor force. Although cheap labor is one of the advantages of developing countries, foreign investors tend to prefer the skilled labor to the unskilled one, including child labor (Neumayer & De Soysa, 2005). As a consequence, children are expected to study in order to obtain a good job in the future rather than dropping out from school to join the work force. The higher level of globalization will results in stronger effects of income and foreign direct investment on reducing child …show more content…
However, at high level of globalization, un-skilled labor, including child labor, is rarely used in imports and exports sectors. Additionally, globalization has increased the human living standard all over the world regardless the larger gap between rich and poor.
In conclusion, globalization does not increase the poverty and inequality in developing countries because poverty and inequality are natural, moreover, globalization helps reducing the incidence of child labor, and promoting redistribution of the wealth through tax coordination. As globalization is an irreversible trend and has positive impact on the fight against poverty and inequality, governments should take it as a potential opportunity in addressing the race to the