Part One – Outline of key arguments and insights
According to most economists, globalization is seen as a beneficial asset for workers, while on the other hand, various sociologists, anthropologists, and historians would beg to differ. Several data determines that even though globalization has increased average incomes in Latin America, the cases of employment quality still tend to be deteriorating. It is important to note the different dimensions of the effect globalization has caused and mechanisms that either benefit or harm workers in changes found within labour demand and work organizations. Following that, a brief summarization of the statistical data from the sectorial case study of Chile’s labour impact will be looked at.
When drawing a comparison between the current trade flows and historical data of Latin America, it concludes how the trade/GDP ratio had previously experienced time of quick progression throughout the 19th and early 20th centuries. Even though this historic outlook is informative, date on other dimensions of globalization endorse its fast-tracked pace during the last few decades. For example, “short-term capital flows have increased dramatically, and in 1998 the worldwide daily turnover of foreign exchange markets was at least seventy-eight times the daily volume of exports of goods and services”. This means that although economic globalization has several dimensions, not all of which necessary have the same impact. In order to reference the employment quality of workers and organizations, various aspects as the country and economic sector people work in, their skill profile, sex, and other socioeconomic characteristics need to be considered.
Economists “Theory of Trade” view globalization beneficial to workers because as the theory states, globalization should favor the development of economic activities that make intensive use of unskilled labor. This subsequently should increase the demand of labour thus an increase in income distribution in developing countries. A large group of authors writing on the topic expect economic gains from globalization both for enterprises and workers, but alert to several side effects that increase insecurity for workers.11 First, structural changes in the economy in line with competitive advantage cause decline in some economic sectors and growth in others, forcing workers to survive a period of unemployment while looking for new jobs and possibly acquire new skills. Second, fluctuations in the price of products in the international economy can translate into variations of employment levels, which will cause job insecurity. Finally, short-term capital flows can have a major influence on countries’ exchange rates that in turn can endanger the competitiveness of the real economy and cause job in security. Moreover foreign investors may potentially be more prone to move on to other countries than domestic investors. Again, this would lead to more job in security. On a more...