Globalized Economics: Inequalities, Development, 'Free' and 'Fair' Trade
Some might argue that trade is the engine for growth and development. Some might also argue that trade is the force for the creation of inequalities. Free trade has been advocated as a way of increasing prosperity and indeed free trade has benefited some. However, it also has developed inequality and its benefits are often over stated. For example, in some countries, because of the removal of trade barriers, inequality is increasing. The World Bank estimates that 1.1 billion people live on less than $1 a day in 2001. It is argued that because of the removal of trade barriers there is no protection for domestic firms and domestic farmers. It is also argued that the least developed nations do not gain the benefit of free trade. On the other hand, the benefits of trade have been overlooked by the opponents of free trade. The opponents of free trade advocate that there should be fair trade. Through fair trade, the least developed countries will have an opportunity to gain the benefit of international trade. Can trade facilitate development? Is there an alternative for sustaining development as well as maintaining trade in the realm of globalization? This paper addresses these questions by discussing the controversies surrounding international trade and development, and exploring development discourses within globalized economics.
Keywords: Inequality, Free Trade, Fair Trade, Development
PhD candidate, Department of Development Studies, The University of Auckland