segnala l'articolo ad un amico

stampa l'articolo

Globalization

di Erik Marangoni - 9 gennaio 2003

The term globalization is not new. Since the end of the last century, the use of word globalization became known to indicate a growing interaction of commercial relations among different countries that not only involved goods and services, but also capitals and work.

From a historical point of view we can individuate 4 or 5 great waves of thoughts that focused on the problem of globalization. The first was the "Greek- Roman literature", that focused mainly on the exchange of goods in the Mediterranean basin through the main way of transport: the sea. Commercial interaction, it was said, is positive because it permitted the consumption of many goods that were not available at home, thus increasing people's satisfaction. Yet, it had a negative connotation, mainly because it provoked an exchange of habits and cultures that could harm the virtues of the peoples.

A second wave of thought is connected to the Jew- Christian civilization. Globalization, it was said, was negative because it prevented mankind FROM contemplating God, but at the same time it was positive because the word of God, through the exchange of goods, could reach the furthest shores of the world.

Many think that the Middle Ages have provoked a strong reduction of the commercial exchanges between different countries. That is not true. In that era, commercial relations were improved and many cities such as Venice became extremely rich. Within its walls there were foreigners coming FROM the furthest countries, selling their own products, and the same happened in London, Rome, Paris and the cities of Spain and Portugal.

The philosophers that first focused their attention on the problem of free commerce were the Fisiocrats. According to them, freedom of commerce was one of the greatest inviolable natural rights human beings were entitled to. That implied a sort of laissez- faire, as the philosopher Quesnay in his "Tableau Economique" put it: the governments might not stop people FROM exchanging goods, nor can they put obstacles to international trade; men have to be free FROM any political reins. As a consequence, Hutcheson introduced the concept of "invisible hand" to EXPLAIN how the market itself could combine the egoistic interests of men INTO a common goal. That same concept was then adopted by Adam Smith, whose analysis of the advantages of international commerce was so strong that it inspired most economists in the next centuries. Smith focuses his attention on the concept of economic growth based on a growing specialization at the microeconomic level. The more people perform their duties, the more expert they become and thus increase the production of goods. The surplus production is exported abroad, FROM where it is possible to import goods not available at home. International commerce, Smith argues, increases the market dimension and so it allows for more specialization. The specialization undoubtedly brings advantages to all countries; we all would have a lower standard of living if we were compelled to make our own clothing, to build our own cars and houses. If people specialize in a narrow range of activities, then the common welfare will increase.

The society, thanks to international trade, removes the limitation according to which an economy consumes only what it produces. International trade provokes a reduction in the world price ratios of goods. The prices of goods will be lower than the autarky prices the countries could cope with in the absence of international trade; a lower prices level increase the consumption level of the population and thus the common well- being.

It is important to stress that all countries benefit FROM international trade; no matter about the dimension of states or their economic specialization. International trade is not a "zero-sum-game" where the gains of one country are at the expenses of another. We can even say that small countries take most advantages FROM international trade with big countries. That happens because when a country becomes bigger (that means more productive) its terms of trade (the relations between the import and export prices) deteriorate. This moves some of the benefits of the productivity growth to the other (small) country; that implies that smaller country are supposed to be the real gainers FROM international trade.

The fact that all countries mutually gain FROM international free trade, does not imply that all individuals benefit FROM it. The gains FROM trade must be evenly distributed among all the individuals living in a country; if not, many people can become worse off FROM trade. In the absence of a sort of redistribution of income aimed at compensating the losers FROM free trade, these could lobby to have protection. When Great Britain entered the European Economic Community (EEC), it started to pay higher prices for purchasing many goods, particularly meat it had previously imported at lower prices FROM Australia, even though the membership of the EEC permitted to import manufactured goods at lower prices. It is likely that British membership has negatively affected a large number of poor families in Great Britain. Yet, we have to marka clear distinction between this two effects. International trade is a source of richness for all countries and must not be hindered on the grounds of internal considerations. It is up to the governments to find out those solutions that will better distribute the gains FROM trade among the population.

	Erik Marangoni