<$BlogRSDURL$>
Return to Main Page | Ragout: Trickle-down or Triumph in India?
Ragout
A Spicy Stew of Economics, Politics, Data, Food, Carpentry, etc.
 
Friday, May 07, 2004

Trickle-down or Triumph in India?


Amy Waldman, in a NY Times Article titled "Low-Tech or High, Jobs Are Scarce in India's Boom," reports some disturbing news,

India's economy is spawning a growing middle class, a host of international companies, a booming stock market and a new image for this nation of more than one billion people.

But those very reforms and conditions are also reducing the prospects of some of its citizens. India may be "shining," in the description of a controversial and expensive government publicity campaign, but it is also struggling to generate jobs
....
For many Indians, then, the dismantling of a quasi-socialist economy that began in 1991, and the growing globalization of the past five years, have meant only the trickle-down of raised expectations and lowered opportunity.

Labor blogger Nathan Newman, apparently much disturbed, comments,
Many free traders tell a story that it's sad that some Americans are losing jobs to "free trade", but we should not be greedy, since it benefits workers in developing nations.

But the current regime of outsourcing, privatization and the race to the bottom is hurting workers throughout the world, with corporate profits the only beneficiary.


What evidence does the Times article provide for all this angst? Two anecdotes about workers losing jobs: a government street sweeper who's had his job privatized, and some concrete mixers replaced by ready-mix concrete. Also, the article says public sector employment has fallen and unemployment is 8% (although this last figure is at best highly misleading).

But what, I ask you, does any of this have to do with globalization and free trade? Was the street sweeper replaced by teleoperated robots controlled from London? Perhaps the ready-mix concrete was imported (although the article doesn't say that), but surely Newman and Waldman don't mean to call for a ban on ready-mix concrete? In any economy that's not totally moribund, large numbers of jobs are created and destroyed every year, so you can always find a few anecdotes about people losing their jobs.

The real story in India is tremendous progress. India's success has been pretty much the most hopeful news in the world in the last decade, since it means a billion mostly very poor people are becoming less poor. Although Waldman and Newman would have you believe that the rich in India are gaining at the expense of the poor, it just ain't so. The truth is, since India began opening up its economy, not only has the economy boomed (GDP growth rates of about 6% for the last few decades), but the poor have benefited tremendously.

Poverty has fallen (35% to 26% from 1994 to 2000), wages are up, fewer children are malnourished (53 to 47% from 1994 to 1999), more kids are in school (51 to 77% over the same 5 years), and unemployment is about the same.
 
|










































Number 1 in Ragout Economics!

ARCHIVES
March 2004 / April 2004 / May 2004 / June 2004 / July 2004 / August 2004 / September 2004 / October 2004 / November 2004 / December 2004 / January 2005 / April 2005 / May 2005 / June 2005 / July 2005 / August 2005 / September 2005 / October 2005 /

LINKS
First Team
Angry Bear
Atrios
Crooked Timber
Brad DeLong
Econbrowser
Economist's View
Freakonomics
Mark Kleiman
Nathan Newman
Political Animal
Max Sawicky
Brian Setser
Sock Thief
Talking Points Memo
Tapped
Matthew Yglesias

Second Opinion
Stephen Bainbridge
Marginal Revolution
Andrew Samwick
The Volokh Conspiracy

Third Way
Fafblog
NewDonkey

Fourth Estate
Economic Reporting Review
New York Times
Slate
Washington Post

Fifth Republic
Ceteris-Paribus
Econoclaste
Le Figaro
Le Monde

Sixth Sense
Deltoid
The Intersection
In the Pipeline
What's New

Politics & Polls
Daily Kos
Donkey Rising
Electoral Vote Predictor
MyDD
PollingReport
PollKatz
Rasmussen Tracking Polls

Other
Art Sucks
Enzo Titolo
L’esprit d’escalier
A Level Gaze
Approximately Perfect


EMAIL
ragoutchef at yahoo dot com

[ATOM]

Powered by Blogger