Re: megaeconomics and inequality

[Gernot Kohler <gernot.kohler@xxxxxxxxxxxxxxx>]

On Mon, 29 Jan 1996 CHU@xxxxxxxx wrote:
.........(in response to an earlier post by Kohler on job exports)>

........>   Transferring a job to a lower wage country has the potential
> to improve the quality of lives of the country significantly.
> An additional slice of bread to the average person in India is significantly
> more meaningful than the same slice of bread to the average person in a
> country with some social safety net. .......>

This raises the problem of inequality within a country (macro) versus
inequality globally (mega). When jobs are exported from a high-wage
country to a low-wage country, workers in the rich country lose jobs and
those in poor countries gain jobs. Some global equalization takes place;
I am sorry for the employees in the rich countries (including
professors who get laid off) and happy for the workers in the poor
countries, except that I think there must be a better way.

A better way would be to pay people in poor countries more. That would
raise incomes in the low-income countries, reduce the inequality in the
global wage system and increase global aggregate demand.

       One method for achieving that would be to organize and
strengthen global labour unions and fight for a global minimum wage of,
say, $5. (Other methods of a global-Keynesian nature are imaginable.)