13/12/2010

Nayeli Villegas Díaz

Article Analysis: “Making Globalization Work” by Joseph Stiglitz

Key words: Globalization, intellectual property, trade/free trade, global warming,

income inequality

Major Thesis: Globalization is not working now a day as it should, so it is important to

make some changes and reshape the thinking about it in order to improve and
strength it.

Supporting Ideas:
1. Increasing inequality between developed and developing countries and within
the countries.
2. Trade agreements do not diminish the discrepancy between developed and
developing countries.
3. Intellectual property rights can create stimulation only if they are well design,
which is extraordinary complex.
4. Global warming is one of the most important issues of globalization.

Summary:
The article is based on a conference of Joseph Stiglitz about his book “Making
Globalization Work”. Stiglitz explained with some examples why globalization is not
working. The first one is the gap between the richest and the poorest countries, it is
supposed that with globalization this gap will diminish but there are growing
inequalities and disparities between the developed and developing countries. And
there are also increasing disparities within most of the countries in the world. The
second issue is the intellectual property, and Stiglitz mentioned that there is an
entire chapter in his book about this topic. The world uses a model based on the
American version of intellectual property, but it is not the best one and developing
countries got together at the World of Intellectual Property Organization and
demanded a development oriented intellectual property regime. Intellectual property
is different from ordinary property. Knowledge is a public good, there's a zero
marginal cost when you shared it, so restricting the use is inefficiency, and
monopolizing it is even worse. Even though patenting knowledge is a bad idea,
people are still doing it because they think by creating intellectual properties rights
you will stimulate innovation. Another issue of globalization is global warming; it is
one of the main problems and is a matter of urgency to solve it. Global warming also
illustrates the inequities in the world because there would some people more
affected than others. The best and only way to find a solution to this issue is by a
global agreement. In the conference Fred Bergsten (Director of the Institute for
International Economics), Nancy Birdsall (founding president of the Center for Global
Development) and some people of the audience made him some questions. Bergsten
said that there are also positive effects derivatives from globalization, arguing that a
study, made years ago, reflected a massive reduction in world poverty during the era
of globalization. Birdsall talk about the terms inequality and unfairness in
globalization. To conclude the conference Stiglitz mentioned that some changes are
needed in order to make globalization works.

Observations:
Globalization can not be seen as something totally good or bad, it has of both sides,
in the conference Stiglitz mentioned only bad effects of globalization, and he said it is
no working at all. And in a certain way he is right, globalization is not bringing all the
benefits that it should bring. But even though globalization is the cause of some
problems as income inequality, it also makes possible economic development.
Friedman said that the technologic revolution and globalization allow people to be
more connected; now a day it is possible to realize anything in almost every part of
the globe. People can now collaborate and compete in a global scale which leads
them to a continuing improvement because they need to be more competitive in an
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international level. This is what he called the flattening of the world. So, as Bergsten
told to Stiglitz during the conference, it is important to see both faces of the coin in
order to do a good analysis of something. So it is clear that some changes have to be
done, but is imperative to know all the effects globalization has, to propose changes
to make it work efficiently.

Major Implications:
This article shows us than even though Globalization brings bad effects, it is
inevitable, so it is important to learn how to deal with it. It is clear that some changes
have to be done to make globalization works. It is important that these changes
occur through negotiation and global agreements when things are still working, in
order to do the changes it in a rational way not as a result of another crisis or during
a crisis.