Naked Economics by Wheelan, Charles (spanish books to read .txt) 📕

a Hooters restaurant. When our group spotted this infamous American export, one man grumbled, “That is just wrong.”

A Hooters in all the world’s great cities is probably not what Adam Smith had in mind. University of Chicago professor Marvin Zonis has noted, “Certain aspects of American popular culture—the depravity and the coarseness, the violence and the sexuality—are eminently worth resenting.”15 The threat of “cultural homogenization”—the worst of it coming from America—is a common knock against globalization. But it is an issue that leads us back to a crucial point from Chapter 1: Who decides? I was not happy to see a Hooters in Puerta Vallarta, but, as I pointed out many pages ago, I don’t run the world. More important, I don’t live or vote in Puerta Vallarta. Neither do the rock-throwing thugs in Seattle or Genoa or Pittsburgh (or wherever else they tend to show up).

Are there legitimate reasons to limit the proliferation of fast-food restaurants and the like? Yes, they present classic externalities. Fast-food restaurants cause traffic and litter; they are ugly and can contribute to sprawl. (Before my valuable work opposing a new train station on Fullerton Avenue, I was part of a group trying to prevent a McDonald’s from moving in across the street.) These are local decisions that ought to be made by the people affected—those who might eat in the safe, clean environment of a McDonald’s restaurant as well as those who may have fast-food wrappers blown in their gutters. Free trade is consistent with one of our most fundamental liberal values: the right to make our own private decisions.

There is now a McDonald’s in Moscow and a Starbucks in the Forbidden City in Beijing. Stalin never would have allowed the former; Mao would not have allowed the latter. Which is a point worth pondering.

The cultural homogenization argument may not be true anyway. Culture is transmitted in all directions. I can now rent Iranian movies from Netflix. National Public Radio recently ran a segment on craftsmen and artists in remote regions of the world who are selling their work via the Internet. One can log on to Novica.com and find a virtual global marketplace for arts and crafts. Katherine Ryan, who works for Novica, explains, “There’s a community in Peru where most of the artists had gone to work in the coal mines. And now, because of the success of one artist in Novica, he has been able to hire many of his family members and neighbors back into the weaving business, and they’re no longer coal miners. They’re now doing what for many generations their family did, and that’s weave incredible tapestries.”16 John Micklethwait and Adrian Wooldridge, authors of the globalization tract A Future Perfect, point out that in the realm of business, a previously obscure Finnish company like Nokia has been able to thump American behemoths like Motorola.

We’re still just warming up when it comes to the side effects of globalization. A Hooters in Puerta Vallarta is a mild headache relative to the horrors of Asian sweatshops. Yet the same principles apply. Nike does not use forced labor in its Vietnamese factories. Why are workers willing to accept a dollar or two a day? Because it is better than any other option they have. According to the Institute for International Economics, the average wage paid by foreign companies in low-income countries is twice the average domestic manufacturing wage.

Nicholas Kristof and Sheryl WuDunn described a visit with Mongkol Latlakorn, a Thai laborer whose fifteen-year-old daughter was working in a Bangkok factory making clothes for export to America.

She is paid $2 a day for a nine-hour shift, six days a week. On several occasions, needles have gone through her hands, and managers have bandaged her up so that she could go back to work.

“How terrible,” we murmured sympathetically.

Mongkol looked up, puzzled. “It’s good pay,” he said. “I hope she can keep that job. There’s all this talk about factories closing now, and she said there are rumors that her factory might close. I hope that doesn’t happen. I don’t know what she would do then.”17

The implicit message of the antiglobalization protests is that we in the developed world somehow know what is best for people in poor countries—where they ought to work and even what kind of restaurants they ought to eat in. As The Economist has noted, “The skeptics distrust governments, politicians, international bureaucrats and markets alike. So they end up appointing themselves as judges, overruling not just governments and markets but also the voluntary preferences of the workers most directly concerned. That seems a great deal to take on.”18

The comparative advantage of workers in poor countries is cheap labor. That is all they have to offer. They are not more productive than American workers; they are not better educated; they do not have access to better technology. They are paid very little by Western standards because they accomplish very little by Western standards. If foreign companies are forced to raise wages significantly, then there is no longer any advantage to having plants in the developing world. Firms will replace workers with machines, or they will move someplace where higher productivity justifies higher wages. If sweatshops paid decent wages by Western standards, they would not exist. There is nothing pretty about people willing to work long hours in bad conditions for a few dollars a day, but let’s not confuse cause and effect. Sweatshops do not cause low wages in poor countries; rather, they pay low wages because those countries offer workers so few other alternatives. Protesters might as well hurl rocks and bottles at hospitals because so many sick people are suffering there.

Nor does it make sense that we can make sweatshop workers better off by refusing to buy the products that they make. Industrialization, however primitive, sets in motion a process that can make poor countries richer. Mr. Kristof and Ms. WuDunn arrived in Asia in the 1980s. “Like most Westerners, we arrived in the region outraged at