Globalization no questions! Labour commanded and Foreign Direct Investment.

Article


De Angelis, M. and Harvie, David 2009. Globalization no questions! Labour commanded and Foreign Direct Investment. Review of Radical Political Economics. 40 (4), pp. 429-444.
AuthorsDe Angelis, M. and Harvie, David
Abstract

A key argument of the globalisation thesis’s sceptics, such as Linda Weiss and Hirst and Thompson, is that most Third World countries remain marginal to the international economy in terms of both investment and trade. The sceptics’ argument is supported by empirical evidence on foreign direct investment (FDI) and trade flows, which are presented in terms of US dollars. In this paper we re-examine the empirical evidence on international investment drawing on the concept of labour commanded, central to Classical Political Economy. Using data on exchange rates and wage rates (or labour costs), combined with that on dollar values of FDI, we remap the patterns of global capital flows in terms of the quantities of labour which such investment can mobilise. On this basis we draw a very different conclusion from the sceptics. In a nutshell, our conclusion is the following: developing countries are far more integrated into the global economy than the FDI data suggests, as a result of the amount of labour that can be commanded with the absolute levels of FDI, itself due to low wages.

Keywordsglobalisation; Foreign Direct Investment; world system; international political economy; labour commanded; capitalism; development; Global South
JournalReview of Radical Political Economics
Journal citation40 (4), pp. 429-444
ISSN0486-6134
Year2009
Accepted author manuscript
License
CC BY-ND
Web address (URL)http://dx.doi.org/10.1177/0486613408324068
http://hdl.handle.net/10552/354
Publication dates
Print29 Oct 2009
Publication process dates
Deposited29 Oct 2009
Additional information

Citation:
De Angelis, M. (2008) ‘Globalization no questions! Labour commanded and Foreign Direct Investment.’ Review of Radical Political Economics, 40 (4) 429-444.

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