Labour Markets & Tech

Lecture 7

Why are suicide rates so high in sweatshops?

• No community - long working hours with no time off

• No hope - no way to get a better job

• Alienation

Alienation

• Estrangement from human’s essential nature - the base of every person is a desire to use their creative potential

• Karl Marx

Maslow’s hierarchy of needs

• Physiological needs

• Safety needs

• Belongingness and love needs

• Esteem needs

• Self-actualization

Self-actualization

Achieving one’s full potential, including creative activities

Esteem needs

Prestige and feeling of accomplishment

Belongingness and love needs

Intimate relationships, friends

Safety needs

Security, safety

Physiological needs

Food, water, warmth, rest

Special economic zones

• Foreign-trade & free-trade zones

• A designated area of a country that is in many ways declared to be “outside” of the country in that regular laws, customs, duties, taxes, regulations, tariffs, or other policies do not apply within that specific zone

• Makes business, manufacturing, and production easier

International Labour Organization

A branch of the United Nations that works to set labour standards, develop policies and devise programmes promoting decent work for all people

Two main challenges to inequality within the labour market (tied to globalization)

• Well documented and publicized violations of human rights and international labour standards (as well as domestic labour standards) around the world, which results in the immense suffering of manufacturing and other workers

• Growing power and wealth of Multi-National Corporations making them some of the most powerful organizations in the world today

Power

The ability to achieve one’s goals when others are trying to prevent them from being realized

• Max Weber

Gross Domestic Product

Measures the value of economic activity within a country. Strictly defined as the sum of the market values, or prices, of all final goods and services produced in an economy during a period of time

• The market value of everything a country produces

Globalization

The process of creating networks of connections among actors at intra- or multi-continental distances, mediated through a variety of flows including people, information and ideas, capital, and goods. Globalization is a process that erodes national boundaries, integrates national economies, cultures, technologies and governances, and produces complex relations of mutual interdependence

Colonization

The action of appropriating a place or domain for one’s own use

International Monetary Fund

Working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world

How did globalization occur?

Improvements in communications and transportation technology

Economic globalization

Trades in goods, trades in service, diversity of trade partnerships (i.e. # of countries traded with), foreign direct investment, international debt, international reserves, international income pay

Social globalization

International telephone calls, international money transfers, international tourism, international students, immigration, emigration, international patents, international bandwidth or international content, international trademarks, Ikea stores, McDonald stores

Political globalization

Embassies, UN peacekeeping. mission, international NGO’s present

Overall globalization

Economic, social, and political globalization indexes combined

Multi-National Coperations

Corporations that have their home base in one country and branches, affiliates, or operations in other countries

Free market or Laissez-faire economics

An unregulated system of economic exchange, in which taxes, quality control, quotes, tariffs, and other forms of centralized economic interventions by government either do not exist or are minimal

Supply and demand

The law which states that the more something is in demand and the lower it is in supply the more expensive it will be, and vice versa

Progressive tax rates

Rates where the more one makes in income, the more tax they will pay

Proportional or flat income

Systems where everyone pays the same tax regardless of income

Free trade agreement

A pact between two or more countries that makes it easier to trade goods across national boundaries. makes it easier by reducing or eliminating restrictions on exports, by eliminating tariffs on imported goods, and by protecting intellectual property rights

Why do countries sign free-trade agreements?

• Help businesses by limiting government restrictions when it comes to national trade

• It’s a bet that your economy can outcompete the other country’s economy in beneficial ways

• Makes it easier to ship goods to other countries, and also to export jobs and manufacturing to other countries

Non-tariff barriers

A way to restrict trade using trade barriers in a form other than a tariff (e.g. quotas, embargoes, sanctions, and levies

Quotas

A government-imposed trade restriction that limits the number of monetary value of goods that a country can import or export during a particular period

Embargo

An official ban on trade or other commercial activity with a particular country

Sanctions

Laws passed to partially re strict or abolish trade with certain countries

Levies

The legal means by which taxing authority or a bank can seize property for the payment of a debt

Bourgeoisie

Those that owned the means of production (like businesses and factories)

Protariat

Those that must sell their labor in order to sustain themselves

Surplus value

The workers produced more value in terms of the product they made, then they were paid in wages

Labour union

An organization formed by workers in a particular trade, industry, or company for the purpose of improving pay, benefits, and working conditions

Race to the bottom

Workers must offer their labour for cheaper, to work for longer hours, and/or to work under worse conditions in order to secure employment versus a corporation being located elsewhere

Job exportation or offshoring

The relocation of jobs to other countries where products can be produced for cheaper

Sweatshops

Work environments characterized by less than minimum wage pay, excessively long work hours, unsafe or inhumane working conditions, abusive treatment of workers by employers, and/or the lack of worker organizations aimed to negotiate better working conditions