POL 208 Feb 2 2011
Lake Victoria on Tanzania… Darwin’s
Egypt…. Structure of Egyptian economy
Inequality- poor live under 2 dollars per day…
40 % of the entire population… High level of
Analysts say national economy as a whole has
been improving in Egypt
Political Regime Economic condition
Trust … economic globalization – labour
movement – still high restrictions
Impact of political border
Liberalization of capital float
•Why does it matter? Allows capital to
exit If capital doesn’t like the local
environment; like the local labor laws,
etc, It now has a “viable exit option”
Substantial impact on politics and
A Race to the Bottom?
-Taxation, labor laws, environmental
regulations, health regulations can
induce capital to move elsewhere
-Canadian workers compete with child
labor in LDC’s (Least Developed
Ultimate result…. Eroding, degrading
restrictions… “A Race to the Bottom”
Ex) reducing taxation… social legislation..
minimum environmental condition;
-The government has less autonomy to
set a policy according to “local values,
needs and tastes”
•Will there be a convergence on the
lowest form of regulation?
•One of anti-globalizationalist’s
Not only cheap, but healthier, educated laborers
– more divergence is possible..?
*** Capital has a great impact on politics?
Ex) WalMart has larger economic entity
than many other nations
The State and the MNC; Multi National
•Is the state becoming powerless?
•What are the ethical implications?
•Does it force us to reevaluate the
winners and losers & with it the theory
of free trade?
•Anti-globalization! Collection of
different interest groups with a variety
of concerns and agendas; focus on
redistribution, externalities (unwanted
side effects of international economic
•Regulation from below??? Fair Trade
•Is there an alternative?
Race to the Bottom Global