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The globalization increases poverty in the world?

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Good Morning friends,

How are you today? With my first coffee of the morning, thinking about economic changes will have the world, at present we are in the stage known as  globalization.

Complex phenomenon fundamentally economic that encompasses economic opening of the general goods and capital markets,cultural exchange etc.

At the beginning of the twenty-first century the biggest problem facing the world is poverty. Trends in world poverty during the last decade. The progress made with regard to the reduction of poverty in the pas ten years was hampered slowly. The number of people living on $1 or less per day had a slight decrease,the performance in the work of poverty reduction was extremely uneven, as well as the distribution of world income.

  • “It is an unbalanced world”

What influences the globalization in these differences?The proposal that greater openness to international trade has a positive effect on per capita income of a country is consistent with economic theories made more than 200 years ago.

The agreement is more general and former trade that allows an economy to make better use of their resources when ceases imports of goods and services at a cost lower than they would have if they ocurred in the country.

What about the impact of free trade on the incomes of the poor? A new work suggests that a greater increase in average incomes in a country usually translates into a rising one by one on the incomes of the poor.

The same work concludes tha this relationship also applies to the increase of income caused by more trade:in other words,the impact of trade on incomes of the poor is generally the same as shown on the income by  and generally also could expect an increase of in the incomes of the poor is generally the same as shown on the income per capita. For example a 10% in the ratio of trade to GDP could finally get to raise the per capita income by 5%  and generally also could expect an increase of 5% in the incomes of the poor.

However, it is important to note that nothing is guaranteed in connection with this result,since many other factors can influence both on growth and on poverty. Besides, the success of a generally open trade is affected by each other in the macroeconomic environment,quality of institutions and other factors.

 ” Higher GDP,higher income per capita – higher incomes of the poor”

Best regards,

Mireya

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Written by forachance

20 October 2008 at 10:29

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