Sunday, September 17, 2006

Q & A with Bhagwati on Globalization

Jagdish Bhagwati (Columbia) is probably the best known economist looking at the broader topic of the "economics of globalization".

On 13th September Bhagwati was involved in a brief Q&A with Daniel Altman of "Managing Globalization". See

In this article Corporate Social Responsibility (CSR) gets a mention in the last two questions. The penultimate question asks:

Q. An interesting aspect of being part of the global supply chain is the pressure exerted by foreign buyers on local suppliers in India and Pakistan to conform with international standards, e.g. labour codes of conduct; minimum wages; effluent treatment plants.

A. For local suppliers, the failure to adhere to international standards implies that lead buyers will not place potentially lucrative orders. On the one hand, the pressure on local firms in India and Pakistan to upgrade to international standards is positive, especially if foreign buyers are able to monitor labour conditions in factories, a responsibility that local governments tend not to fulfill in these countries. On the other hand, upgrading requires costly investments such as effluent treatment plants which all firms cannot easily afford.

This answer relates to a series of papers that Matt Cole and myself are trying to get underway/finish (see the ETSG presentation post) looking at "environmental spillovers" via the standard measures of backward and forward linkages. Data remains the largest obstacle to rapid progress in this area.

I am currently reading Bhagwati's Free Trade Today book. He has published many other books on this issue (many more academic than the one above including International Trade textbooks) - see the link below for other Bhagwati texts. His more popularist books provide a good overview of the free trade / pro-globalisation argument. His most recent book "In defence of globalisation" does what is says on the tin.

Jagdish Bhagwati

No comments: