How globalization & immigration result in more poverty & inequality - simple analogies - Politics Forum.org | PoFo

Wandering the information superhighway, he came upon the last refuge of civilization, PoFo, the only forum on the internet ...

"It's the economy, stupid!"

Moderator: PoFo Economics & Capitalism Mods

Forum rules: No one line posts please.
#15306038
How globalization & immigration result in more poverty & inequality - some thoughts

Trying to understand economic phenomena can be complicated and difficult for most people to understand, so sometimes it can be helpful to use simple analogies.

Many have the feeling that globalization is somehow "draining away" the United States' wealth, but cannot explain precisely how it is happening, in economic terms. And immigration from other parts of the world seems to be increasing poverty levels in the country, but again most who suspect that would have difficulty explaining the precise economics of how exactly it is causing that.

In science, there is the principle of gas pressure. If you have two chambers containing gasses of different pressure, and you open a valve to allow gas flow between those two chambers, very soon the air pressure between the two chambers will equalize. They might have started off different, but they will end up the same.

This is known as "equilibrium". There will always be some gas steadily flowing back and forth between the two chambers. But when one chamber has much more air pressure than the other, there will be a much stronger flow of gas going in one direction.

In the case of the United States, the country is much wealthier and has higher per person living standards than many other parts of the world.
That is why so many immigrants want to come to the United States, and that is why it is cheaper to move jobs that once were in the United States to other countries.

But there is also a saying that the rich get richer and the poor get poorer. Wealth tends to attract more wealth. If an individual is already wealthy, it is easier to get more wealth.
So this is like a competing phenomena, the opposite of the first.

We could maybe use the analogy of a black hole. A black hole is an immense and concentrated collection of mass. It sucks and pulls in more mass, growing bigger. And when it gets bigger, it then attracts matter with even more force than before.

So we have two competing forces. Wealth levels tend to equalize between two different economies, two different countries, or two different groups of people. But at the same time, there is a tendency for wealthier individuals to consolidate more wealth.

You might think these two different effects might just cancel each other out (and to a little extent they do) but it is not so simple as that.
What the combination of these two effects results in is an increased level of inequality in society.

Wealth is being drained away, and wage levels are going down, but at the same time individual persons with large amounts of money are benefitting.

It has been observed (or pointed out) that while Globalization may reduce the level of inequality between different countries, it increases the level of inequality within individual countries.
#15306041
Puffer Fish wrote:
How globalization & immigration result in more poverty & inequality - some thoughts

Trying to understand economic phenomena can be complicated and difficult for most people to understand, so sometimes it can be helpful to use simple analogies.

Many have the feeling that globalization is somehow "draining away" the United States' wealth, but cannot explain precisely how it is happening, in economic terms. And immigration from other parts of the world seems to be increasing poverty levels in the country, but again most who suspect that would have difficulty explaining the precise economics of how exactly it is causing that.

In science, there is the principle of gas pressure. If you have two chambers containing gasses of different pressure, and you open a valve to allow gas flow between those two chambers, very soon the air pressure between the two chambers will equalize. They might have started off different, but they will end up the same.

This is known as "equilibrium". There will always be some gas steadily flowing back and forth between the two chambers. But when one chamber has much more air pressure than the other, there will be a much stronger flow of gas going in one direction.

In the case of the United States, the country is much wealthier and has higher per person living standards than many other parts of the world.
That is why so many immigrants want to come to the United States, and that is why it is cheaper to move jobs that once were in the United States to other countries.

But there is also a saying that the rich get richer and the poor get poorer. Wealth tends to attract more wealth. If an individual is already wealthy, it is easier to get more wealth.
So this is like a competing phenomena, the opposite of the first.

We could maybe use the analogy of a black hole. A black hole is an immense and concentrated collection of mass. It sucks and pulls in more mass, growing bigger. And when it gets bigger, it then attracts matter with even more force than before.

So we have two competing forces. Wealth levels tend to equalize between two different economies, two different countries, or two different groups of people. But at the same time, there is a tendency for wealthier individuals to consolidate more wealth.

You might think these two different effects might just cancel each other out (and to a little extent they do) but it is not so simple as that.
What the combination of these two effects results in is an increased level of inequality in society.

Wealth is being drained away, and wage levels are going down, but at the same time individual persons with large amounts of money are benefitting.

It has been observed (or pointed out) that while Globalization may reduce the level of inequality between different countries, it increases the level of inequality within individual countries.



a) Needs a linky.

b) BS.
#15306059
late wrote:a) Needs a linky.

It does not need a link.


But how about this? This comes from a United Nations report:
"Income inequality between countries has improved, yet income inequality within countries has become worse."
https://www.un.org/en/un75/inequality-bridging-divide

This comes from the World Bank:
Theorist Eric Maskin: Globalization Is Increasing Inequality

From the International Monetary Fund:
"Within-country inequality has risen in most countries. While the progress in the reduction of global inequality over the last thirty years has been remarkable, within country inequalities have increased, especially in advanced economies. Over the past three decades, more than half of the countries and close to 90 percent of advanced economies have seen an increase in income inequality"
https://www.imf.org/en/Topics/Inequalit ... inequality

Imagine paying $6/gallon because of the Iran at[…]

You are saying there isn't a whole [lot there (?)[…]

Russia-Ukraine War 2022

About Kissinger, look up "realpolitik". […]

Left vs right, masculine vs feminine

The reality is that we need both a left and a rig[…]