Trade liberalization and poverty reduction: Complimentary or contradictory aims?
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AbstractTrade commentators and organizations have over the past decades taken it as a given that trade liberalization leads to improved growth and improved living standards. Indeed, the Preamble to the Agreement Establishing the World Trade Organization (WTO) lists one of the organization's objectives as “raising standards of living, ensuring full employment and a large and steadily growing volume of real income and effective demand…” The Preamble further recognizes the “need for positive efforts designed to ensure that developing countries, and especially the least developed among them, secure a share in the growth of international trade commensurate with the needs of their economic development.” Implicit in these statements is that increased trade will increase the wealth of a nation and thus reduce poverty.

At the same time, it is also well understood that trade liberalization produces “winners” and “losers”. The most notable “losers” are protected industries and the resulting loss of jobs in those industries. Resistance to trade liberalization therefore comes not only from the capital in protected industries, but also from the labor. While there is perhaps some sympathy for capital, there is clearly a need to protect the employees who lose their jobs and ensure that their situation improves over time.

All Author(s) ListMercurio B.
All Editor(s) Listed. by Krista Nadakavukaren Schefer .
Detailed descriptioned. by Krista Nadakavukaren Schefer .
Pages66 - 78
LanguagesEnglish-United Kingdom

Last updated on 2021-11-01 at 00:51