Term Paper on "Trade and Poverty in the Poor Countries"

Term Paper 4 pages (1210 words) Sources: 1 Style: MLA

[EXCERPT] . . . .

Trade and Poverty in the Poor Countries

Trade and Poverty in Poor Countries"

By Jagdish Bhagwati and T.N. Srinivasan

Written by two highly competent and skilled university professors, "Trade and Poverty in Poor Countries" is the result of extensive research on both empirical as well as practical materials. The article commences by stating the latest trends in economic thought, which state that regardless of the previous statements forwarded by the advocates of globalization and market liberalization, the phenomena increase the relative poverty in the meaning that they deepen the income gap between the wealthy and the poor in all developed, developing and less developed countries, unlike having the opposite effect, initially mentioned.

The debate in the article revolves around the relationship between growth and poverty in the context of international trade and encompasses declarations made by specialized economists along the years. Two major theories have been as such promoted. For once, there is the theory that trade generates growth, which then reduces poverty. Secondly, there is the theory according to which globalization and market liberalization are in the detriment of the poor population.

The arguments discussed have been categorized as theoretical and empirical and can be summarized as follows:

Theoretical Issues:

Open trade only affects the efficiency of the business operations, increasing the productivity and quality of the labour force, the managerial act and the allocation of resources (Harrod-Domar Model) - This is partially true as the liberalization of markets has eased the trade of all commodities and resources, including capital and technologies. Then, these new and easily accessible resources are used in the manufacturing process and increase its efficiency. But then, the result is a better product or a better service, which will serve the needs of a more pretentious customer base. As such, it is rather simple to state that trade only affects the efficiency of business operations. It would be more correct to say that the effects of trade commence with the business process and then generate a series of chain reactions.

The growth of the state is independent and cannot be influenced by its economy (Solow, 1956) - This could not be further from the truth. For after all, what does the growth of a country mean if not better products, superior services, wider and more accessible financing opportunities and increased living standards? And how else could these be achieved if not through economic growth?

Trade should affect growth in the meaning that it increases accumulation of capital and commodity and also adds numerous elements of novelty which improve the business processes. But accumulation and innovation are rarely affected in the same way by trade - This is also true since trade does indeed stimulate improvements and innovation, but to achieve this, the national organizations have to increase their investments and ensure a continual circulation of their capital - therefore, accumulation is rather limited. On the other hand, were a country to focus on accumulation, they would have reduced amounts of funds for investments, and growth would be achieved at slow rates.

If the labour force is perfectly elastic to the growing areas, than the poor will be engaged in productive activities, registering as such superior incomes and reducing poverty (Arthur Lewis Model)

If growth is concentrated in highly industrialized and central regions, and does not encompass the underdeveloped parts of the region, then growth will avoid the poor and will even further deepen the income inequality. Furthermore, in this sort of situations, the poor will be even more disadvantaged, as their products resulting from working the land will be unable to compete with the products manufactured in the industrialized centers… READ MORE

How to Reference "Trade and Poverty in the Poor Countries" Term Paper in a Bibliography

Related Term Papers:

Poverty Proposal Ghana Term Paper

Ghana Poverty

International Bank ForReconstrcution and Development

Ghana -- Public Private Partnership (PPP) Project

PROJECT at a GLANCE

Country

Ghana

Region

Africa

Project Cost

$17.5 Million

Project Duration 8 Months… read more

Term Paper 23 pages (6891 words) Sources: 18 Topic: African History / Africa

---

Poverty Find a One Poor Country to Analysis Term Paper

Poverty

Economic Overview

Since the enactment of Vietnam's "doi moi" policy for economic renovation in 1986, Vietnamese authorities have committed to increased economic liberalization and enacted structural reforms needed to… read more

Term Paper 3 pages (876 words) Sources: 4 Style: APA Topic: Economics / Finance / Banking

---

Fair Trade Reaction Paper

Fair Trade for All: The Czech Republic

Fair trade is designed to be fair to all countries, but in many cases what is "fair" to one country (or even several… read more

Reaction Paper 5 pages (1802 words) Sources: 5 Topic: Government / Politics

---

Country of Sudan Dependency Theory vs. Modernization Term Paper

Country of Sudan

Dependency theory vs. modernization theory

Religion and Politics

Ethnic-cultural divisions

Women and development

Agrarian reform and the politics of rural change

Rapid urbanization and the politics of… read more

Term Paper 10 pages (3574 words) Sources: 6 Style: APA Topic: African History / Africa

---

Biblical View on Poverty Social Justices Term Paper

Biblical View on Poverty, Social Justice

Poverty emerges as the result of deprivation from accessing the basic necessities including health and food. From time immemorial, the role of poverty plays… read more

Term Paper 3 pages (1093 words) Sources: 3 Topic: Religion / God / Theology

---

View 100+ more related papers  >>