On Balance, Economic Globalization is Beneficial

IntroductionEconomic globalization, as pointed out in the given definitions, does not refer to the external effects regarding the social and political climate of the nations involved. I found this to be implied within the definition itself, as well as the topic of debate, but it seems as if my opponent has misconstrued the subject of debate. Argument should revolve around the economic ramifications, such as the national income, technological growth and general innovation, employment, fiscal health of ordinary citizens, etc. It should not include the environmental or social effects, as those are external or secondary effects of economic globalization, not primary ones. The voters should take this into account when assessing the debate.I. PovertyEconomic globalization has been a worldwide phenomenon for the past 200 years, encompassing the birth of the Industrial Revolution and the lessening of absolute poverty within much of Europe, and later, the rest of the developing world. Data from the World Bank as well as various other major organizations shows that the world poverty rate from 1820-2015 has declined by a substantial percentage, amounting to billions of people lifted out of both absolute and relative poverty over the span of two millennia. As shown by the graph below, this trend has been a sharp decline, with much of world poverty being eradicated over the same span of massive efforts to decrease trade barriers, end mercantilist fiscal policies, and accentuate international trade. [1]The source also states "As we can see, in 1820 there were just under 1.1 billion people in the world, of which more than 1 billion lived in extreme poverty. Over the next 150 years the decline of poverty was not fast enough to offset the very rapid rise of the world population, so the number of non-poor and poor people increased. Since around 1970 we are living in a world in which the number of non-poor people is rising, while the number of poor people is falling. According to the estimates shown below there were 2.2 billion people living in extreme poverty in 1970, and there were 705 million people living in extreme poverty in 2015. The number of extreme poor people in the world is 3 times lower than in 1970." [1] Additionally, it is very important to note the work done by China in particular in eradicating much of their poverty levels in the span of a over 40 years. As shown below, Chinese economic policies regarding trade and international exchange of goods has lessened poverty substantially, contributing to much of the gains in the eradication of poverty in the world. From almost 750 million people in 1990, the poverty rate has fallen to less than 50 million in 2015, a 700 million decrease in the span of 25 years. At the same time, the Chinese government has lessened trade barriers, such as tariffs, and has engaged in various international trade unions, such as NAFTA and China-ASEAN FTA, as well as the Asian Infrastructure Investment Bank. [3]The entirety of this is due to a rapid interconnection of nations and the lessening of trade barriers, leading to vast amounts of investments in developing nations and the systematic eradication of poverty. Economists and statisticians expect that these growth rates will further decrease poverty in the future, nearby eliminating it altogether. By 2030, they expect poverty levels to be below 5%, down by almost 90% in 200 years. [1] Such decreases in poverty not only aids the development of nations across the world, it also allows for greater involvement in the economy for people, as the inflow of investments creates greater opportunity for poverty stricken communities and nations to take part in the global economic sphere. World Bank data states that "By 1820 only a few places in the world had achieved economic growth – and only to a rather small extent. The reduction of poverty from the last 200 years was largely possible because economic growth brought higher incomes to more and more people in the world." [1]II. Productivity and EfficiencyEconomic globalization leads to specialization and a substantially more efficient allocation of resources than before the establishment of trade. For example, the growth of manufacturing sectors in developing nations such as India, China, Indonesia, and the Eastern Bloc (Post-Soviet Era) has allowed for the movement of labor to manufacturing while maintaining agricultural levels as a result of innovation within the industry, all due to the desire for profit in a cost-efficient manner. As many developing nations are trapped in the cycle of endless money recycling within the economy, the eradication of trade barriers creates incentives for foreign investors to tap into these economies. When it comes to businesses as a whole, large corporations benefit from the larger economies of scale as a direct result of their ability to partake in foreign markets, benefiting the inhabitants of these nations greatly through a decrease in prices, an increase in wages, and the creation of facilities for employment. The following source has a similar assertion, stating that "An economic policy of self-sufficiency would cause Floridians to waste precious resources raising salmon themselves even though the salmon raised by Alaskans would be cheaper. Likewise, self-sufficiency would cause the Alaskans to build costly greenhouses to grow oranges instead of buying cheap Florida oranges." [4] Additionally, it references various empirical studies, writing that "Numerous recent studies by economists (Vamvakidis, 2002; Bhagwati and Srinivasan, 2002) have shown that the pattern of economic progress around the globe reflects, among other things, a country's willingness to jump on the globalization train. Krueger (1995) makes a forceful case that globalization is important for developing nations. Recent evidence on global economic policy provided by Gwartney and Lawson (2002) provides powerful evidence of the benefits of trade. Gwartney and Lawson rate countries' openness to foreign trade on a zero to ten scale based on a range of factors such as tariffs, quotas, and other trade restrictions." [4]III. Income and Economic GrowthPerhaps the most important facet of economic globalization is the rampant increase in the national income of every nation involved in international trade and mutual investment ventures. From the 1990s onward, China has maintained a relatively high amount of economic growth, surpassing 10% during certain periods and maintaining an average of 6% in the past 2 decades. This is due to the West's push for the lessening of trade barriers during the 1990s, thus allowing for Western capital, particularly from the United States to flow into developing nations, primarily China. This has not only led to the eradication of much of nation's poverty (as stated before), but also to the rapid growth in its GDP. [5]The Indian GDP has been growing at a record pace as well, topping 8% growth in some quarters. [6] In the same time period as the growth of the Chinese economy, the Indian economy went from a lessening of growth during some quarters to a stable level of annual growth reaching well above the growth maintained by most developed nations. Additionally, economic globalization affirms capital inflow and outflow, as nations gain comparative advantage as a result of their ability to enlarge their respective business sector's consumer base. As wealth is not a zero sum game, this form of investment and consumption levels accelerate employment and income of individuals in developed nations while allowing for the easing of costs for consumers in developed nations, thereby benefiting each party. Furthermore, such a rapid increase in economic growth and high levels of capital inflow allows for developing nations to not only develop faster, but at a more productive and efficient rate. China, as an example, went from a destitute agrarian society in the 1960s to the 2nd largest economy and a hub for trade and innovation 5 decades later, all due to the policies undertaken by the Chinese government regarding trade and foreign investment.Globalization has a large benefit for developed nations as well. Investments from developed nations allows for developing nations to grow, but these investments bring profit back to the developed nation, as well as outsourcing labor to nations with a need for better employment opportunities, thus creating demand within service industries in the developed nation itself, as the manufacturing is outsourced. While this may be seen by political demagogues as a disadvantageous undertaking, the lower cost of production combined with a large economies of scale for businesses in the primary and secondary sectors of the economy allows for a decrease in the price of consumption for consumers, further creating incentive for investment and growth.An article by Investopedia documented different empirical studies regarding the benefits of globalization, stating that "Foreign Direct Investment's impact on economic growth has had a positive growth effect in wealthy countries and an increase in trade and FDI, resulting in higher growth rates. Empirical research examining the effects of several components of globalization on growth, using time series and cross sectional data on trade, FDI and portfolio investment, found that a country tends to have a lower degree of globalization if it generates higher revenues from trade taxes. Further evidence indicates that there is a positive growth-effect in countries that are sufficiently rich, as are most of the developed nations." [7]Sources:[1]https://ourworldindata.org...[2]http://povertydata.worldbank.org...[3]http://fta.mofcom.gov.cn...[4]https://www.elca.org...[5]http://www.tradingeconomics.com...[6]http://www.tradingeconomics.com...[7]http://www.investopedia.com...