Business PME is a gate of free information bound for the companies in the United States of America. This website offers thousands of contents as well as a companies directory.
The group’s other BtoB websites
-- Professional Networking
Monday March 15th 2010
Searcharticles Search
companies
- Strategy
- Marketing
- Advertising
- Trade
- Human Ress.
- Law & Rights
- Economics
- Finance
- Production
- Technologies
Race to the bottom | ||
In government regulation, a race to the bottom is a theoretical phenomenon that is said to occur when competition between nations or states (over investment capital, for example) leads to the progressive dismantling of regulatory standards. This theory states that this reduction of regulation, welfare, taxes, and trade barriers will increase poverty, and drive the poor to the few remaining areas that retain protections. In the end this theory argues that this will force the last remaining states to drop their protections in order to survive. Currently available data does suggest that jobs and capital flow more frequently to states with lower protections, but does not support the notion that these states suffer increased poverty or income inequality. Data also supports the notion that states retaining high protections sustain or increase their poverty in comparison to states reducing the regulatory framework and trade barriers but does not support the argument that this increase in poverty is due to mass immigration of poor. Current data suggests that the mass poor migrate more frequently to the more open states where jobs are more readily available. Occurrence and limitationsThe occurrence of races to the bottom is mitigated by the costs of moving investment and production between countries, by persistence of comparative advantages (such as skilled workforces, infrastructure or proximity to natural resources), and by the presence of minimum standards, rules or conventions which prevent them. Races to the bottom can also occur between the states or administrative regions within nations, which often seek to attract businesses and jobs on the basis of a favourable regulatory environment. The extent of such intra-national races is limited by the power and inclination of central national governments to act against them. In practice, races to the bottom appear to be rarer than some critics of globalisation have feared. States are often willing to maintain regulatory regimes even if they lose certain investment or industries as a result. ImplicationsIn its early stages, a race to the bottom can be of immediate benefit to all parties, in situations where laws are genuinely and inefficiently burdensome. In general, however, these contests regularly work to undermine the ability of governments to enforce labor standards such as workers' compensation, or to raise taxation in order to fund social services and correct externalities (such as pollution and social degradation). According to this theory, races to the bottom between sovereign states can also undermine democratic accountability, since the elected governments are no longer economically capable of passing legislation which enforces environmental or labour protections that are more stringent than those current in neighbouring countries. Some economists believe, however, that "races to the bottom" can help ameliorate poverty, for if businesses can operate for less money, they can cut prices while maintaining their profit margins. Copyright 2008 - France BtoB from Wikipédia
|
• Focus group
• Association of Licensed Automobile Manuf&hellip • Context analysis • Business Software Alliance • Methodologies of strategic planning • Key principles of decision-making • Cost-benefit analysis | |
