Foundation Briefs Advanced Level February Brief Resolved

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Foundation Briefs

Advanced Level February Brief

Resolved: On balance, economic globalization benefits worldwide poverty reduction.

Table of Contents

Table of Contents 2

Table of Contents 2

Definitions 3

Definitions 3

Definition AMS 3

Statistics Demonstrating Economic Globalization AMS 3

Topic Analysis One 5

Topic Analysis One 5

Topic Analysis Two 14

Topic Analysis Two 14

Pro Evidence 25

Pro Evidence 25

Success in the Reduction of Poverty 26

Extraordinary Success in Global Poverty Reduction AMS 26

Poverty Reduction in India, Columbia, Zambia, Mexico, and Ethiopia AMS 27

Poverty Reduction Millennium Goals Achieved AMS 27

Poverty Reduction Across all Regions AMS 28

Growth in Developing Countries Since Rise of Economic Globalization AMS 28

Even the poorest in society are better off, Fj 30

Reversing Globalization will not help, Fj 31

Globalization Reduces Inflation 32

Correlation between globalization increasing and inflation falling, Fj 32

Efficient Firms have Lower Prices, Fj 32

Increasing output decreases inflation, Fj 33

This also applies to emerging economies, Fj 33

Globalization changes the goals of central banks, Fj 34

Globalization has had a strong effect on reducing inflation, Fj 34

Domestic Prices Become Less Volatile, Fj 35

Globalization reduces inflation by reducing producer prices, Fj 35

Globalization reduces inflation by increasing labor productivity, Fj 35

Globalization has been especially important in reducing inflation in manufacturing, Fj 36

Further globalization will continue to decrease inflation, Fj 36

Globalization reduced inflation in the United Kingdom, Fj 36

Globalization reduced inflation in Europe, Fj 36

Globalization reduced inflation in the United States, Fj 37

Developing Countries Benefit from Global Economic Engagement 38

Poorer Countries Achieve Success through Global Economic Expansion AMS 38

Developing Countries that Participate in Global Market Succeed AMS 39

Global Trade Liberalization and the Developing Countries. PSM 40

The effect on Poverty with Agreement on Agricultural Global Trade. PSM 41

Poverty and Social Analysis of Trade Agreements. PSM 43

Case study: Mauritius and resource-scarce coastal Africa. DAT 44

Globalization Reduces Global Inequality Overall 45

Global Inequality Reduced AMS 45

Income inequality Growth is an Exaggeration AMS 45

No Overall Increase in Global Inequality AMS 46

Globalization increases equality of opportunity 48

The presence of multinational firms increases equality of opportunity. DAT 48

Trade liberalization gives small businesses a competitive advantage against large ones. DAT 50

Benefits of Economic Globalization for Developing Countries 51

Globalization Improves Access to Necessary Materials AMS 51

The correlation between economic growth and globalization. DAT 52

Trade Liberalization in China. PSM 53

Statistically linking trade with economic growth. DAT 54

Examples of How Nations Benefit from Economic Globalization 55

Nigeria is not a Victim of Economic Globalization AMS 55

Nigeria Would Benefit from Further Economic Globalization AMS 56

Economic Globalization and its Impact on Poverty: Case Study Pakistan. PSM 56

Trade Liberalization and Poverty Reduction: Evidence from Indian States. PSM 57

Trade Liberalization and Poverty in India. PSM 58

Trade Liberalization and Poverty Reduction in Sub-Saharan Africa. PSM 59

Trade Liberalization and Poverty Alleviation in Nigeria. PSM 60

Trade Liberalization in Ghana. PSM 61

Trade Liberalization in Indian States. PSM 62

Poverty Alleviation in Nigeria with Trade Liberalization. PSM 63

Trade Liberalizing Financing in Ghana. PSM 64

Poverty Reduction in Least Developed Countries. PSM 65

Benefits of Free Trade 66

Key Benefits of Free Trade in Globalization AMS 66

Free Trade Fosters Economic Freedom AMS 67

Sub-Saharan Africa Would Benefit from Greater Economic Freedom AMS 68

Developing Countries Benefit from Freer Trade AMS 69

Potential for Free Trade in Reducing Poverty AMS 69

Trade between developing countries insulates their growth from global downturns. DAT 70

Developing Countries Integrate into Global Supply Chains AMS 71

Impact of Trade Liberalization on Food Security and Poverty. PSM 72

Trading Up: Impact of Trade Liberalization on Poverty. PSM 73

Trade Liberalization in Developing Countries. PSM 73

Trade Liberalization and Poverty: The Link. PSM 74

International Trade and Poverty Alleviation. PSM 75

Multilateral Trade Liberalization and Trade Reduction. PSM 76

Trade liberalization and Poverty Reduction. PSM 77

Trade Liberalization and the Poor. PSM 78

Market Opportunities with Trade Liberalization. PSM 79

Largest Gains from Trade Liberalization. PSM 80

Free Labor Laws Benefit Developing Countries 81

How Migration Benefits Developing Countries AMS 81

Key to Capitalizing on Migration Benefits AMS 82

Technology Globalization Helps Developing Countries 83

New Technology Lowers Entry Barriers AMS 83

Small Business Growth is Crucial for Developing Countries AMS 84

Opportunities of Biotechnology AMS 84

Growth Potential in Agriculture AMS 85

New Technology Allows Agriculture in Dryer Areas AMS 86

Linking Globalization to Modern Farm Technology AMS 86

New technology benefits skilled workers and local firms. DAT 87

The Impacts of Global Investment on Economic Growth 88

Linking economic growth to poverty reduction. DAT 88

Foreign direct investment has been a primary driver of economic growth. DAT 89

International investment as a means of job creation. DAT 90

Globalization Reduces War 92

Economic interdependence makes war an unattractive option, Fj 92

Polachek and Seiglie study, Fj 93

Economic connections are stronger than shared political ideologies, Fj 93

Globalization Reduces Civil War 94

Promoting Development, Fj 94

Reducing Income Inequality, Fj 94

Reducing State Control Over The Economy, Fj 95

Increasing Communication And Information Flows, Fj 95

Reducing Export of Primary Products, Fj 95

Increasing the Size of Security Forces, Fj 96

Generating Economic Benefits, Fj 96

Con Evidence 97

Con Evidence 97

Developed Countries Shape Trade Policy to their Own Advantage 98

Trade Policies are Dominated by Developed Countries AMS 98

Trade Liberalization and Evidence of Negative Effects on Poor. PSM 98

International investment in developing countries favors large multinationals over locals. DAT 99

International trade liberalization prescriptions cut safety nets in developing countries. DAT 101

Multinational companies often take advantage of poorer countries, Fj 103

Economic Globalization Increases Inequality 104

Mind the Gap: Economic Globalization Widens the Global Inequality Gap AMS 104

Trade Deficits for Developing Countries Grow AMS 104

The Critics Agree AMS 105

Wealth Generated by Economic Globalization Does Not Trickle Down AMS 106

Economic growth in developing nations grows inequality, too. DAT 106

Some stats on inequality, Fj 107

The impact of globalization on inequality. DAT 108

Linking Inequality and Hindrances to Poverty Reduction 109

Developing countries cannot leverage economic growth from globalization effectively. DAT 109

Trading Off the Poor. PSM 110

Trade Liberalization and Adversely Affects on Poverty. PSM 111

Liberalizing international finance cuts off fiscal choice for the poor. DAT 111

Economic Globalization Reduces Security 113

Financial Uncertainty for Developing Countries AMS 113

China is the chief thief of U.S. intellectual property FJ 114

Chinese dumping hurts American businesses FJ 115

China is clearly guilty of dumping FJ 117

Economically Unhealthy Dependence AMS 118

Developing Countries Hurt Deepest by Global Economic Crises AMS 119

Most developing countries are commodity-dependent, which fluctuate in the global market. DAT 119

Problems with Financial Globalization for Developing Countries: Instability AMS 121

Case study: Sub-Saharan Africa is economically vulnerable to international markets. DAT 121

Import reliance threw Sub-Saharan Africa into economic freefall. DAT 122

Developing economies are the most susceptible to trade shocks. DAT 123

Economic Globalization Hinders Other Necessary Means of Globalization 124

Globalization of Labor Standards, Environmental Protection, Etc. Neglected AMS 124

Key Resources Damaged AMS 125

Misguided Intervention AMS 126

One Size Fits All Approach Fails AMS 127

Environmental Problems with Economic Globalization AMS 128

Investment on a national level to leverage the global economy hurts the poor. DAT 129

Trade Liberalization is Not a Panacea for Poverty. PSM 130

False Premises of Trade Liberalization. PSM 131

Globalization has hindered education in Africa. DAT 132

Examples of Developing Countries Hurt by Economic Globalization 133

Failure to Reduce Poverty in Nigeria AMS 133

Devastating Effects of Trade Liberalization in Zambia and Ghana AMS 134

Trade Liberalization and Lagging Regions in Asia. PSM 134

Globalization created instability in Thailand and Indonesia, Fj 135

Chinese Economic Involvement in Africa Hurts African Countries 136

Toxic Relationship AMS 136

Trade with China Hurts African Business AMS 137

Chinese Hinder African Countries from Reaching Economic Potential AMS 137

Dutch Disease 139

Dutch Disease can appreciate the real exchange rate, Fj 139

Commodity rich countries that trade extensively are often doomed, Fj 140

Link between globalization and Dutch Disease, Fj 141

Oil 142

Oil Exporting Countries are vulnerable to Dutch Disease, Fj 144

Oil Exporting Countries are already experiencing Dutch Disease, Fj 144

Globalization Measures Hurt Developing Countries 145

Structural Adjustment Programs Hurt Developing Countries AMS 145

Developing countries are increasingly capable of dealing with poverty locally. DAT 145

Reliance on global trade is a vulnerability for developing countries. DAT 146

Developing countries cannot regain import tariff revenue. DAT 147

The influx of international money and power saps African nations’ governing ability. DAT 149

Globalization has fueled rampant migration in developing countries: Brazil case study. DAT 151

Export Oriented Agriculture Shift Creates Poverty 152

Export Oriented Agriculture Shift Hurts Developing Countries, Creates Poverty AMS 152

International investment has abandoned agriculture and, in turn, the rural poor. DAT 154

Case study: Ethiopia’s agricultural trade liberalization harmed export-oriented farmers. DAT 155

Problems with Debt Relief 156

Charity or Debt Relief Fails to Reduce Poverty AMS 156

Aid Backfires AMS 156

Outsourcing and Inequality in Developing Nations 157

When foreign multinationals hire local labor, the poor do not see benefits. DAT 157

Globalization has unpaired high and low-skilled workers in developing countries. DAT 158

Low-skilled workers are excluded from the global economy. DAT 159

Developing countries outside Asia have missed the boat on benefitting from globalization. DAT 159

Globalization Increases the Likelihood of Civil War 161

Promoting Underdevelopment, Fj 161

Raising Income Inequality, Fj 161

Reducing State Control of The Economy, Fj 162

Increasing Communication and Information Flows, Fj 162

Promoting Export of Primary Products, Fj 163

Stimulating Alliances Between Rebels and Organized Crime, Fj 163

Generating Unequal Economic Benefits, Fj 163

Pro Counters 165

Pro Counters 165

African Businesses Not Dependent on Aid 166

African Businesses Not Dependent on the Eurozone AMS 166

The problem with how Income inequality Studies Measure Income 167

Income Inequality is Decreasing Overall AMS 167

Studies Fail to Account for Geographic Differences AMS 168

World Income Inequality Stabilized AMS 168

Importance of Seeing the Big Picture AMS 171

China Isn’t Responsible for Global Poverty Reduction 172

While China’s growth accounted for heavy global growth, other regions mirrored it. DAT 172

Looking forward, China will be a nonfactor in global poverty reduction. DAT 173

Foreign Direct Investment (FDI) Benefits Developing Countries 174

Increased FDI Benefits Developing Countries AMS 174

FDI can step in where local institutions fail. DAT 175

FDI doesn’t increase inequality over the long term. DAT 176

FDI is key to technology globalization (see corresponding Pro Evidence topic). DAT 177

Economic Globalization is Beneficial in the Long Term 178

Indirect Impacts of Financial Globalization AMS 178

Globalization not to blame for Africa’s current economic situation, Fj 179

Dutch Disease Is Not Impactful 180

Dutch Disease rarely happens, Fj 180

Globalization Not to Blame for Poverty 181

Too Many Other Factors to Blame Globalization AMS 181

Domestic institutions bear the blame for globalization’s failures, Fj 182

Not all nations are set up to benefit from globalization. DAT 184

While frequent, increasing poverty is still an exception to the rule. DAT 185

One explanation for Africa’s economic lag: financial outflow. DAT 186

The poverty impact of capital flight in Africa. DAT 186

In many African nations, stagnation is due to misallocated internal resources. DAT 187

Globalization needs to be coupled with sensible domestic policy. DAT 188

Globalization Does Not Promote Economic Inequality 189

There is no empirical causative link between globalization and inequality. DAT 189

A summary of findings on inequality. DAT 189

Trade Liberalization Doesn’t Decrease States’ Revenue 191

Case study: Sub-Saharan African nations make more tax revenue after trade liberalization. DAT 191

Globalization and Environmental Protection 192

Globalization has not led to any environmental opportunism. DAT 192

Con Counters 193

Con Counters 193

Figures Showing Poverty Reduction are Inaccurate 194

Reduction in Poverty can be Only Attributed to China’s Economic Growth AMS 194

Problems with Surveys of Income and Expenditure AMS 195

Problems with Poverty Line Calculation AMS 196

A major factor is how many people, annually, approach the poverty line. DAT 197

Global poverty reduction in the past has been deceptively easy. DAT 197

Case study: village-level studies show no progress on poverty. DAT 200

Economic data on globalization’s effects makes showing causal relationships impossible. DAT 201

Chinese and Indian poverty reductions may not have been fuelled by globalization. DAT 203

Agriculture is better at reducing poverty, Fj 204

Globalization does not reduce inflation 205

Commodity Prices have increased due to globalization, Fj 205

Globalization does not reduce inflation in the long term, Fj 205

Commodities will have increased inflation, Fj 205

Oil prices have increased due to globalization, Fj 206

Studies on globalization are not reliable, Fj 206

Disadvantages of Free Trade 208

The Problems with Free Trade AMS 208

How Free Trade Hurts Developing Countries AMS 209

The primary benefit of free trade is for companies requiring high-skill labor. DAT 210

Free trade treaties can force countries into human rights violations. DAT 211

Implementing free trade responsibly has been thus far voluntary and unsuccessful. DAT 213

Economic benefits of trade are not guaranteed and depend on what is being traded. DAT 214

Global Inequality Is a Deceptive Measurement 215

The world has become more unequal, not less, as globalization has sped up. DAT 215

In Brazil, trade liberalization decreased inequality by lowering skilled wages. DAT 216

Globalization Doesn’t Reduce Poverty 217

Poverty numbers are misleading, Fj 217

Rising Food Prices mean more hungry people, Fj 217

East Asian countries skew the statistics, Fj 217

The number of poor countries is increasing, Fj 218

Globalization has not helped Sub-Saharan countries, Fj 218

Globalization creates more climate change, Fj 218

Methodology flaws in pro-globalization studies. DAT 219

Case study in sub-Saharan Africa: Recent empirical data and justification of findings. DAT 221

The benefits of free trade don’t reach the generally poorest nations (sub-Saharan Africa). DAT 223

Globalization Slows Technological Progress 224

Schumpeter’s Theory AMS 224

Economic Globalization’s Impact on Progress AMS 224

Domestic Resources Can Eradicate Poverty 226

Case study: African nations have internal funding for substantial anti-poverty measures. DAT 226

China’s poverty reduction was not wholly dependent upon globalization, Fj 226

Response to Technological Globalization 228

Technological globalization drives up inequality in developing countries. DAT 228

Foreign Direct Investment Is Not A Guaranteed Success 229

There is still no empirical way to validate the use of FDI. DAT 229

Globalization doesn’t exist in a vacuum; local policies often negate gains. DAT 230

Cases 231

Cases 231

Pro Case 232

Introduction: 232

Contention One: Economic growth leads to poverty reduction. 232

Contention Two: Developing Countries Benefit from Freer Trade. 233

Contention Three: Examples of success in developing countries. 234

Con Case 236

Introduction: 236

Contention One: Globalization reduces equality of income 236

Contention Two: Globalization reduces equality of economic opportunity 237

Contention Three: Without income and opportunity, poverty worsens 237

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