POLB81 Lecture 5 – February 4 2012.
This article is an instant of institutionalism. They have technical expertise – experts on
Instant of hegemonism: capitalism/Western power. Offer their advice about how to
better function in the global capitalist economy.
Instant of change – the worlds mandate has evolved multiple times. What it thinks they
should be doing.
Instant f globalization of alternating the world bank in globalization. Private money
flows. Canada is not the major player anymore in terms of funds and capital but we are
a major player when it comes to technology and knowhow to develop an economy.
They’re still going to go with their goal to help poverty but less of the role.
What Kind of a problem?
What kind of a problem Development is? On the slide picture is Melleium development.
Hegemonism – Problem of capitalism and how capital is distributed unequally. Not all
countries are able to be a part of globalization because what they’re good in producing
is already being produce by someone else. Even if they produce it, the cost they get is
not too much. (LDC is only good in agriculture).
o Exploitation and transformation.
o Control of production- commodity dependence. Set up to disadvantage workers
and advantage the people with capital. Essentially actors of the global south are
locked in a disadvantageous global structure. The structure of capitalism forces
Institutionalism – Bad governance, failed states & lack of resources, lack of knowledge,
economic growth lacking, and a problem of cooperation. This is identified by states as
needing a solution. The problem of making better states to enhance the sovereignty of
Feminism – Long term, institutionalized subjugation of women. Gender discrimination
leads to poverty. Inequality of education.
Global Poverty and Underdevelopment: What do we have to work with?
Conventional solutions: We think these are solutions but are not.
Encourage Low Wage industries- to increase investments in the country, get more jobs,
and get advantage of your comparative advantage to make jobs, which lets people get
out of poverty.
o Claim: Any job is better than no job. This can have transformative effects of
people’s lives. Over time, eventually wages and standards will go up. (ex. China,
Taiwan, Japan) o The flip side: Health consequences how do you attract low wage industries?
Economist say: You will be locked into power because you cannot build up
human capital. Global North say: It leads to outsourcing which hurts the global
More Aid - you allow countries to start building capital.
o Big scale: Direct development aid,
o Small scale – micro-credit – gives a little money to individuals. Provides some of
the resources to enhance capital that would get you out of poverty.
o Flip side: Conditionality – What kind of strings are attached to the aid? Are the
strings to promote development of a certain kind?
Moral Hazard – if you give aid without seeing what they’re doing,
should we bail out banks that are failing?
People consistently, overestimate how much aid we give to countries.
People think we give too much. People can see the cost, overestimate
the cost and don’t see the benefits.
o What are the developments/advantages to helping countries? Markets to sell
your own goods, future trading allies, moral argument, security and stability;
concentrated cost and diffuse benefits.
Debt Relief – same argument as foreign aid. Would take countries debt.
o Domestic – promote education, give services, build capital, get rid of corruption,