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Zantrex-3 YES!
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Joseph E. Stiglitz. Globalization & Its Discontents. W. W. Norton, 2003.

Anyone interested in Economics and Globalization should pick up this book by Joseph E. Stiglitz. I'm about half way through and am thoroughly enjoying it. The main focus of the book is related to the IMF and World Bank and how they have failed to accomplish the goals of their founders. Stiflitz explains how the thought process of these organizations has had a negative effect on developing nations and he shows how things could have been handled better.

This book has definitely helped me solidify my focus in Economics and give me some direction of where I want to go; something I've been needing this past year.
 

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Zantrex-3 YES!
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One thing he points out is the IMF/World Banks implementation of policy. They don't adequately review developing countries' economic states by spending time in said country so they can never truly know what "help" the country needs. In a nutshell, their policies are too general and rely too much on basic theory.

Another thing is that the IMF has such policies that only allow the USA to veto and no other countries. This means the USA can implement policy that caters to its own interest and not a global interest. A complete double standard to protect US firms and not achieve true equilibrium.

Also, the IMF and World Bank have a largely negative view of the role government plays in development and feel the govt's role should be minimized straight off the bat which can cause major upsets. They feel that free markets will correct themselves without any gov't help but in reality the gov't is needed to make sure things are kept on track and a gradual change occurs.

A final thing Stiglitz brings up is that the majority of developing nations are afraid of voicing their opinion to the IMF because if they do, the IMF will cut funding to their economies. The IMF feels it knows what is best for developing nations much like a imperialistic father when in actual fact it has it's head so far up in the theoretical clouds that it has no idea what these dev. nations are in need of.

There are plenty more issues brought up and a lot of plain common sense which seems to be lacking in these organizations.
 

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Here's an excellent quote from the book I found particularly interesting;

"The poor are caught in a series of vicious spirals: lack of
capital leads to that of foods and to ill health, which limits their
earning ability, leading to still poorer health. Barely surviving,
they cannot send their children to school, and without an
education, their children are condemned to a life of poverty."

I thought this was an insightful view because many believe the poor are just lazy when in actual fact that can be so far from the truth. There's a reason the poor are not able to rise above the state they are in. The last sentence regarding education is key because education, especially female education, is what is going to be the driving factor in bringing developing nations up to higher standards of living.
 

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2.5RSMatt said:
One thing he points out is the IMF/World Banks implementation of policy. They don't adequately review developing countries' economic states by spending time in said country so they can never truly know what "help" the country needs. In a nutshell, their policies are too general and rely too much on basic theory.
well, im not even sure if the IMF is truly acting for the good of all countries. i honestly have no idea, but i can see them being very heavily influenced by corporations who want to exploit developing countries for labor purposes. there is a lot of politics involved in that stuff, lots of money being thrown around. you say dont know what help the country needs, i wonder if they even really care? a lot of companies look for people who will work for the least amount of money possible. companies like to try and minimize cost to maximize profits. a lot of corruption could be here, but i dont know enough about the IMF to really say.

2.5RSMatt said:
Another thing is that the IMF has such policies that only allow the USA to veto and no other countries. This means the USA can implement policy that caters to its own interest and not a global interest. A complete double standard to protect US firms and not achieve true equilibrium.[/quoote]

america pretty much does whatever it wants these days. i mean, what are other countries going to do to us? whine about it? oh ok...

2.5RSMatt said:
Also, the IMF and World Bank have a largely negative view of the role government plays in development and feel the govt's role should be minimized straight off the bat which can cause major upsets. They feel that free markets will correct themselves without any gov't help but in reality the gov't is needed to make sure things are kept on track and a gradual change occurs.
well, free markets *may* correct themselves, but many countries dont have enough of a market to begin with. a little jumpstart may just be all a country needs to get going.


2.5RSMatt said:
A final thing Stiglitz brings up is that the majority of developing nations are afraid of voicing their opinion to the IMF because if they do, the IMF will cut funding to their economies. The IMF feels it knows what is best for developing nations much like a imperialistic father when in actual fact it has it's head so far up in the theoretical clouds that it has no idea what these dev. nations are in need of.
mmm imperialism is not a liked word anymore, it has a bad connotation that follows it; much like 'colony'.

i can see countries being afraid of speaking up, people are giving you lots and lots of money to help you; you arent going to badmouth them and tell them how to give you money bettter.



i am curious as to what solutions Stiglitz brings to the table. He argues that the IMF isnt allocating funds correctly, but what is his plan?
 

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2.5RSMatt said:
Here's an excellent quote from the book I found particularly interesting;

"The poor are caught in a series of vicious spirals: lack of
capital leads to that of foods and to ill health, which limits their
earning ability, leading to still poorer health. Barely surviving,
they cannot send their children to school, and without an
education, their children are condemned to a life of poverty."

I thought this was an insightful view because many believe the poor are just lazy when in actual fact that can be so far from the truth. There's a reason the poor are not able to rise above the state they are in. The last sentence regarding education is key because education, especially female education, is what is going to be the driving factor in bringing developing nations up to higher standards of living.
i can picture that downward spiral, makes perfect sense.



"poverty is the best condiment for the great feast of the world, but the inexperienced and poor are never invited to it."

-Anthony Burgess​

i think a lot of countries could seriously benefit from building tourist attractions and such. you could base a cities economy off tourism if you have cool shit. throw some money around and advertise it over here. then have some nice setup with an airline company that will agree to make a route to go there. so build an airport in the poor country, use the local populous for labor, thats jobs right there. then just have maybe a few hotels (more jobs). hmm some of the workers would have to be able to speak english. oh look, desired job skills, something to work for. shit, build a school, teach the kids english. i dont know, it seems like a good idea to me.
 

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another quote:

"We Athenians hold that it is not poverty that is disgraceful but the failure to struggle against it."

-Pericles



i think a lot of country's leaders want the country to prosper, but the average poor person who lives in a hut or something doesn't know anything different besides poverty. if they arent educated they dont really know what affluence even is. Mark Twain argues, "In the small town of Hannibal, Missouri, when I was a boy, everybody was poor, but didn't know it; and everybody was comfortable and did know it". when you can survive and life your life comfortably, it doesnt matter if you are 'poor' or 'rich'. they are both relative terms. if you are living your life the way you want to then its all good.
 

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Zantrex-3 YES!
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Discussion Starter #8
svek said:
i think a lot of countries could seriously benefit from building tourist attractions and such. you could base a cities economy off tourism if you have cool shit. throw some money around and advertise it over here. then have some nice setup with an airline company that will agree to make a route to go there. so build an airport in the poor country, use the local populous for labor, thats jobs right there. then just have maybe a few hotels (more jobs). hmm some of the workers would have to be able to speak english. oh look, desired job skills, something to work for. shit, build a school, teach the kids english. i dont know, it seems like a good idea to me.
The problem with tourism is that it thrives off the service sector. The problem with the service sector is that it doesn't require skilled labor. The problem with lack of skilled labor is poor growth; the main concern for developing nations. The industrial sector is the seed of growth as it encorporates technological advances and further learning resulting in higher human capital.
 

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2.5RSMatt said:
The problem with tourism is that it thrives off the service sector. The problem with the service sector is that it doesn't require skilled labor. The problem with lack of skilled labor is poor growth; the main concern for developing nations. The industrial sector is the seed of growth as it encorporates technological advances and further learning resulting in higher human capital.
However, the infrastructure to support a tourist destination will in time have a positive effect on the country.

You will need housing/shopping/infrastructure for these foreigners who are running hotels, jet ski rentals, own travel tour bus companies, Skilled Electricians/Plumbers/Masons/auto mechanics/pool techs/ cops/teachers/firemen/utiliteis techs etc......

Immediate needs for skilled labor will be filled by foreigners, who will hire unskilled labor to do grunt work. A conglomerate can move in a whole village in a year if the money is there and the land is cheap.

The indiginous unskilled labor will learn those trades from the bottom up and will in turn become master (Insert blue/white collar job here).

Locals will fill gaps in staffing as the money/health/education comes online. Sure these "Poor" will sell their soul to the company for a better life, but it's more than they get from the IMF.

Eventually the foreigners are cut out due to cheaper skilled "Locals" who can do the job for less. I get beat out sometimes because an illegal undercut my costs.

I see it all the time in Brooklyn with all the Latin Americans and epecially El Salvadorians in the trades.

Within a couple of days of arriving in NY these guys are working the sh!t jobs. Its a progress that starts with humpin' buckets of grout, then they become ripout guys, then They hang/tape/sand sheet rock or lay tile. Eventually these guys are running a crew, learning enough english to get by and living the American Dream.

You say the third world's countries are poor? These guys work like animals and are quick studies with no "Formal" education.

Luckily I am working on getting my Master Plumbers License for NYC. It's a recession proof, outsourcing proof, high paying industry that is understaffed.
 

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Zantrex-3 YES!
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Discussion Starter #10
L8APX; I understand where you are coming from with your explination for growth but the issue is building that infrastructure. To build such infrastructure you need preexisting infrastructure to support the growth. These developing economies are unstable in themselves and cannot rely on another unstable structure such as tourism. I have no doubt that firms could enter (if governments allow them) ,set up shop, and prosper but the majority of that money will flow back into the economies of those foriegn investors, while money earned by the domestic population, by means of the service sector, will not be reinvested into the industrial sector but spent on food and other basic needs.

Third world countries are poor. They are classified as such by the per capital income equaling less than 2 PPP $ per day. I have no doubt that the populations in these countries work hard but ther majority of that work is agricultural. Education IS needed and yeilds a very high rate of return in the primary school and secondary school years. The problem is many children are taken away from school to help work in this agricultural sector.
 

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2.5RSMatt said:
L8APX; I understand where you are coming from with your explination for growth but the issue is building that infrastructure. To build such infrastructure you need preexisting infrastructure to support the growth. These developing economies are unstable in themselves and cannot rely on another unstable structure such as tourism. I have no doubt that firms could enter (if governments allow them) ,set up shop, and prosper but the majority of that money will flow back into the economies of those foriegn investors, while money earned by the domestic population, by means of the service sector, will not be reinvested into the industrial sector but spent on food and other basic needs.

Third world countries are poor. They are classified as such by the per capital income equaling less than 2 PPP $ per day. I have no doubt that the populations in these countries work hard but ther majority of that work is agricultural. Education IS needed and yeilds a very high rate of return in the primary school and secondary school years. The problem is many children are taken away from school to help work in this agricultural sector.
Education is on the way, it's a small program but I'd rather send these than send more troops to Africa.

Read this, it will give you hope. And it's the private sector stepping up, imagine that?

Human powered laptops for $100 each.

http://news.com.com/Negroponte+Slimmer+Linux+needed+for+100+laptop/2100-7346_3-6057456.html
 
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