Globalization is also the cause of inequality in the worlds economy, considering the fact that globalization has benefited the rich much more than the poor. While poverty rates have fallen as a result of our world becoming globalized, the workers are still getting an incredibly low income, which might cause social instability and conflict. Globalization has had a positive impact. One of the main advantages is that based on per capita GDP
Aid can become an obstacle to development because of the tied nature of much aid, which benefits the donor country more than the recipient, in economic terms. Tied aid is bilateral aid in which the donor country specifies conditions relating to the way the money is spent. This often involved spending money on goods and services from the donor country. Aid is also an obstacle to development because of the frequently inappropriate use of aid on large capital intensive projects which may actually worsen the conditions of the poorest people. The strengthening of political ties as a result of bilateral aid may increase dependency and hinder democracy in the recipient country.
However, there are advantages and disadvantages of international trade in the simulation that cause the world’s economy to fluctuate and leave certain countries astray. One of the advantages to international trade that I found for countries was the monetary gains and having the ability to keep their own markets honest causing the local producers to improve its goods for the reason citizens have more choices available to them. The disadvantages of international trade have to deal with countries of higher power that try to take advantage of smaller countries by swindling their government into unorthodox trading during a crisis within those countries. Another disadvantage is the possibility of local producers becoming weak, causing the unemployment rate to rise because local producers are unable to compete with international
Economic growth involves the rise of output in an economy by using gross domestic product (GDP) to measure ‘the total value of everything produced in an economy in a time period (…)’ (Fribbance, 2009, p. 21) Research on happiness outlines the limitations and complexity of people´s well-being on a global basis. 2. Scientific perspectives on wealth and happiness The claim that there are connections between economic growth, wealth, health and happiness has led scientists to conduct research on this topic. There are various findings either supporting or opposing the claim that one factor has an impact on the other. 2.1 Supporters of the more wealth = more well-being claim Indur Goklany: The improving state of the world: Why We Are Living Longer, Healthier, More Comfortable Lives on a Cleaner Planet Stevenson and Wolfers: Economic Growth and Subjective Well-Being Goklany points out that people live in a better place now
Wilkinson and Pickett explore two of the most common assumptions about the social gradient that shows people at the bottom of social hierarchies suffer more problems- circumstances and individual tendencies. The authors, in critiquing the material explanation to societal problems, argue that richer nations should do better than poorer ones. This is a flawed argument, as national wealth does not indicate its distribution. A generally wealthy nation may have poorer diets, less educational opportunities, or worse housing in comparison to a less wealthy nation. Wilkinson and Pickett also give reason as to why everyone in a society should be concerned about inequality, not merely those vulnerable to the problems with which it coincides.
A 2010 study considered it beneficial, while other recent studies consider it a growing social problem. While some inequality promotes investment, too much inequality is destructive. Statistical studies comparing inequality to year-over-year economic growth have been inconclusive; There are various numerical indices for measuring economic inequality. A prominent one is the Gini coefficient, but there are also many other methods. Measurement of inequality in the modern world A study entitled "Divided we Stand: Why Inequality Keeps Rising” by the Organisation for Economic Co-operation and Development reported its conclusions on the causes, consequences and policy implications for the ongoing intensification of the extremes of wealth and poverty across its 22 member nations .
3. People often feel that tariffs, quotas, and other import restrictions will save jobs and promote a higher level of employment. But trade restrictions that reduce the volume of imports will also reduce exports. Question 4: What do researchers have to say about the relationship between firm’s productivity and exposure to global competition? Answer: Question No.5: When is international trade an opportunity for workers?
Why are Tropical Countries so poor? “Development implies change, and this is one sense in which the term development is used, that is, to describe the process of economic and social transformation within countries.” So Economic development should lead to the improvement in the economic and the social aspects of an economy; such as a countries standard of living, the infrastructure within the country and a stable economic environment that encourages investment activities. Developed economies tend to have high GDP per capita when compared to their undeveloped counterparts; thus individuals are richer as oppose to the poor in underdeveloped countries. Economic growth is achieved via the supply of goods and services, what an economy do and make is what improves our living standards. If one lives in an economy which produces high quality products, then the living standards of those within that economy will be higher than that of individuals who live in an economy that produces poor quality goods.
Does GDP per capita provide a satisfactory measure of living standards in a country? To answer this question, we will divide our essay into two parts. In the first, we will seek to show that GDP per capita is generally a good measure of living standards. However, we will try to explain in the second the limits that make per capita GDP an imperfect measure of economic welfare. Growth Domestic Product (GDP) measures the value of goods and services produced in a country.
People’s prosperity is judged established on the money they have on hand and their acquisition power. Therefore, it is rational to determine that while people with inferior income are having hard times in their life and when the advantage of committing a crime will provide them superior advantage, they are willing to do it. However, the question lies in how countries measure poverty. The level of poverty can be different among countries. For example, U.S. census has indicated that, U.S. households is generally make up with parents and two kids, and they are considered to be poverty families when the household income is less than $25,000 (United State Census Bureau 2012).