(This is an archived extract from the book Patterns of Power: Edition 2)
It is important to be able to explain to people in comparatively rich countries that globalisation will not automatically lead to a 'race to the bottom' in wages. The advantage of cheap labour is temporary: the workers in developing economies are able to push for higher wages and better working conditions as their productivity increases because they are competing in a global market. Western workers may choose a different combination of pay and benefits, but overall they will continue to be able to enjoy a higher standard of living than other countries for as long as they maintain their advantage in productivity. Steingart correctly pointed out the importance of education in achieving this.[1]
It should not be forgotten that the developed world constitutes a growing market for companies in richer countries.
© PatternsofPower.org, 2014
[1] Gabor Steingart’s views on globalisation were quoted above, by reference to a lecture at the LSE on 10 June 2008 entitled The War For Wealth: The true story of globalization and how Western society can survive, which is also the title of his book. An MP3 recording of the lecture was available in April 2014 at http://www2.lse.ac.uk/publicEvents/events/2008/20080523t1155z001.aspx.