The growth
of free trade has not had a positive effect for all in the developed
economies, according to a World Bank document quoted by the BBC.
According to
an internal memo from the Washington-based organization seen by the
British broadcaster, the side effects "may have led to rising
wage inequality.” The document, written by World Bank economists,
says "trade has played a powerful role in creating jobs and
contributing to rising incomes in advanced economies,” but also
highlights its cons.
"Recent
evidence from the US suggests that adjustment costs for those
employed in sectors exposed to import competition from China are much
higher than previously thought. While trade may have
contributed to rising inequality in high income economies, so has
technological change and the weakening of institutions that used to
represent the interests of labor,” the report said.
“Given overall efficiency gains, the dislocation effects of
trade in advanced economies must be addressed through stronger safety
nets and enhanced skills and flexible labor markets,” it added.
World Bank
president Jim Yong Kim explained why people in the developed
economies are angry with the free trade. “I hear them and they
are saying that my life is not better than my parents and my
children's life does not look like it's going to be better than
mine,” he said in a BBC interview. “So there is a real
concern but the answer is to have more robust social security
programs, so you have a safety net. And then you need to get serious
about getting the skills you need for the jobs of the future,”
he added.
This
June’s Boston Consulting Group Global Wealth report said that
millionaires will control more than half of the world's wealth by
2020. In particular, people who are worth more than $20 million in
the United States will control 29 percent of the country's wealth by
2020, compared to 20 percent in 2010.
Source:
Comments
Post a Comment