What does globalization do for individuals?

The title is a little bit misleading, but several of my students have expressed ideas in opposition to globalization that seem to sound like neo-dependency theory--ideas that globalization and world trade tends to disadvantage poor people in poor countries.  

If you're one of these folks, you might be interested in this post from Chris Blattman (a world-class development economist) on Mexican export-processing factories. He cites two studies examining the effects of participating in this labor market on individuals.

Effects are mixed.  The key passage:

1. Workers earn better wages than in non-export oriented industries;
2. Women who get jobs have taller children;
3. But youth drop out of school earlier to take the jobs; and
4. For those that drop out, their wages in the long term are lower than if they had stayed in school and gone to work for the factories later.

If you're interested in this stuff, you can also get to the papers through Blattman's blog. 

There is a longstanding debate about these issues--the effects of globalization on the poor--and we will talk about the environmental piece of this debate in PSCI 3206 later in the semester.  Scholars generally agree nowadays that globalization can be either harmful or helpful to individuals, though it probably does more good than bad, economically.

Of course, we don't just value economic outcomes, and there are good reasons to be concerned about the effects of globalization on particular groups of individuals.   

Globalization, migration, and the peasant economy.

I've often wondered if the great urban in-migration you see around Latin America is a result of free trade and other pieces of economic globalization. While the shantytowns around Lima grow, in some places in rural Peru, the female to male ratio is eight to one, as all the men have moved away to get better paying jobs in the city.

The optimistic explanation for this is that, although life in the shantytowns of Lima is very hard, insecure, and unhealthy, it's a damn sight better than the life of the rural peasant, tilling the fields out in the sun, rain, and wind all year. Thus, people get away to find a better life.

On the other hand, if you're or a pessimist (or a hippie) you probably think it's ol' man globalization rearing his pasty white head--low-priced agricultural imports driving local agriculture out of business, and forcing the producers to the city to support their families. Though city life is terrible, it's the only option many people have to keep from starving. In the second scenario, globalization may be a strong countervailing force against human and economic development.

Although the second scenario is kind of attractive because it's slightly counter-intuitive yet compelling, I've come to believe more strongly in the first story. Although many rural Peruvians are market-oriented, most peasants in the most rural (and poorest) parts of the country--the places where there has been a large amount of migration to the cities--mostly produce only for their families. Basically, they exist in a subsistence economy.

If this is true, it's awful hard for global economic forces to have any impact on these people at all. Hence, my optimism that rural out-migration is really a desirable phenomenon.