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Globalization And Higher Living Standards

Globalization is spawning a rise in living standards

The main focus in this article is to illustrate how globalization has improved the lives of many in developing nations. Globalization in of its self is the trading of goods and services of a local economy into an integrated global economy. Technological advances have made this practice more feasible with in the last 50 years. The major milestones were the development of the internet and increased transportation technology. These two advances made the world coined "flat" and set the stage for higher living standards.
Countries such as Asia and Latin America have really harnessed these technology advances. They have been exporting their products and services on to the world wide market at alarming rates. Due to increased productivity in there economy there overall score card "GDP" gross domestic output per person has increased significantly. The higher the GDP, the better off the country and its people are theoretically supposed to be. Asia has seen the most significant jump in GDP in the last 50 years. On average its people have seen a 5 times greater GDP per person due to an ever expanding economy.
Globalization is the driving force behind increased GDP per person. Evidence has been studied linking that countries that tend to globalize faster have a directly proportionate increase of GDP of 5%. This study was conducted by David Dollar and Aart Kraay of the World Bank. They studied the countries between 1960 and 1990. The worlds two largest developing countries India and China make a perfect example. India increases its GDP per person from 2% to 5% by encouraging foreign trade and investment. It lowered its tariffs by more than half in one year to encourage this.
It also has been shown that foreign companies who operate in developing nations pay there employee's higher salaries than domestic companies. The increase is typically 12%- 30% more. Foreign companies can afford...

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