Transnational companies, with their massive economies of scalemay drive local companies out of business. Because oil is used in growing food and for commuting, a rise in oil price tends to lead to a cutback in discretionary spending, recession, and lower oil use in these countries.
Part of the shift in the balance between investment and consumption of assets is rising consumption of assets. We are also helping countries to pursue a pro-competition agenda through tools like our Product Market Regulation Indicator, which we expanded last year with the World Bank.
There are many approaches to dealing with the costs of globalization, but protectionism is a dead end. This has clearly shrunk by more than half. Pros Supporters of globalization argue that it has the potential to make this world a better place to live in and solve some of the deep-seated problems like unemployment and poverty.
For that to be the case, we have to provide greater support to those who are hurt by trade. I have more than 35 years of experienc This lowers profits and diminishes incentives to grow the business and employ more workers.
With globalization, goods can often be obtained cheaply from elsewhere. Academic research has found substantial gains for India following its dramatic trade reforms in the s, which benefited consumers via lower prices and firms via higher markups.
It is also crucial to empower our people with the skills needed to unlock jobs in the most sophisticated sectors. This time, there also is no possibility of a dip in world oil demand of the type that occurred in the early s.