Argument: Globalization and free trade has reduced inequality

Issue Report: Free trade


  • “Poverty in an Age of Globalization “, The World Bank ,October 2000 “There is compelling evidence that increased openness to trade and investment has played an important facilitating role in accelerating growth and poverty reduction in an increasing number of developing countries, and hence in reducing overall global inequality. Conversely, lack of openness increases inequality between countries since closed developing economies have performed much more poorly than more open ones (see figure 6). The poor performance of these countries is not, therefore, the result of integrating with the world economy, but on the contrary it is due to their inability to achieve greater integration. This inability is largely due to domestic conditions (including wars and chronic macro instability), but it is often worsened by barriers to integration still imposed by the rich countries.(see also box1)”