In Defense of Globalization

By Bhagwati, Jagdish; Cammett, Melani | International Journal, April 1, 2005 | Go to article overview

In Defense of Globalization

Bhagwati, Jagdish, Cammett, Melani, International Journal

IN DEFENSE OF GLOBALIZATION Jagdish Bhagwati New York: Oxford University Press, 2004. xii, 3o8pp, $36.95 cloth (ISBN 019-517025-3)

In the flurry of popular and scholarly books addressing the nature and impact of contemporary economic globalization, Jagdish Bhagwati's In Defense of Globalization is an important contribution. As the title reveals, the book articulates strong support for globalization, particularly in the guise of free trade and direct foreign investment. Bhagwati's goal is to systematically debunk the principal arguments of anti-globalization activists, whom he divides into two camps: anti-establishment forces with total opposition to market-based systems, and critics who focus on more specific aspects of globalization yet, he contends, base their arguments on incomplete or poor information. Dismissing the former group, Bhagwati takes on the arguments of the latter to expose flaws in their reasoning and reveal the "human face" of globalization.

The book is organized around a broad range of themes that, together, encompass the major contemporary critiques of globalization. In response to critics' arguments that globalization increases poverty and income disparities, undercuts worker rights and labour standards, imperils democracy, harms the economic and social positions of women, erodes local cultures, and harms the environment, Bhagwati aims to show that the opposite is often true.

One of the great strengths of the book is to disaggregate the constituent parts of globalization, which is often treated as an undifferentiated whole in popular discourse. Bhagwati carefully distinguishes between different kinds of international flows of goods, services, and people. In particular, he emphasizes the distinction between long- and short-term capital flows. Although he is an ardent proponent of globalization, Bhagwati is less than sanguine about the impact of short-term capital flows on developing economies and he blames the east Asian financial crisis on the absence of adequate capital controls in the most affected countries.

By adopting a more tempered and socially conscious perspective, Bhagwati differs from other proponents of the global spread of free markets. For example, he shuns "shock therapy," or the rapid and comprehensive implementation of market-oriented reforms, in favour of a more gradual course of economic change that avoids social dislocation and, hence, political backlash. The book also devotes substantial attention to the contention that globalization exacerbates social ills such as child labour or the economic and social subjugation of women. Bhagwati largely rejects these claims, although some of his arguments-such as his observations about the motivations of and benefits for women participating in "global care chains" (76-80)-are largely based on anecdotal evidence, but he recognizes that cross-border movements of women and children in domestic labour and prostitution rings is indeed an explorative aspect of contemporary globalization.

Bhagwati's discussion of the positive effects of globalization on poverty alleviation is a key component in his effort to expose the humane aspects of globalization. The author claims that globalization reduces poverty through a two-step process: trade increases growth, which in turn reduces poverty (53). While there is broad consensus on the first step of the process, there is less agreement on how and whether growth reduces poverty. The book cites the work of David Dollar and Aart Kraay, World Bank economists who published a recent study linking increased trade with poverty reduction. But Dollar and Kraay's contentions have catalyzed a spirited debate questioning or at least modifying their findings. Furthermore, recent decades suggest mixed experiences with trade and poverty in the developing world. While some countries such as China and India have experienced declining absolute poverty levels during recent periods of open economic policies, others, notably in Latin America, continued to exhibit high poverty rates and wide income disparities. …

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