Globalization in India

by Don Boudreaux on December 18, 2009

in Cleaned by Capitalism, Complexity and Emergence, Growth, Standard of Living, Trade, Travel

My GMU colleague (and Division of Labour’s) Larry White filmed this two-plus-minute-long video earlier today in Bangalore, India.  (HT Andy Roth)

UPDATE:  My sincere apologies: My colleague Larry White just e-mailed me to inform me that he is not the person who filmed this video.  I believe him (!).  But, omigosh!, the voice sounds just like Larry’s.

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  • Diana Lauder Sacks
    Good Afternoon: I am researching my mother's family. My grandfather, my mother's father, was born in India in 1878, the son of English parents who went to Bombay in the mid-19th century. My grandfather worked for the Post Office in Bombay for a while and then entered the British Army in India. He returned to England, married an Irish girl, and returned to India. He fought in the Boer War in 1901, and was present at the relief of the British Legation in Peking. He eventually was posted to Bangalore. My mother was born in Bangalore in 1913 and was baptized at St. John's Church in Bangalore. My grandparents and their three children, two sons and my mother, returned to England about 1920. My grandfather retired as a Captain. I am trying to find out something more about my grandparents and my great-grandparents who, in the mid-19th century, went to Bombay as building contractors.

    Do you have any leads you can give me?
  • vjdotbright
    There is more of Thomas Babington Macaulay in India's emergence as global player. Macaulay, in a paper he wrote in 1853, recommended that English should be promoted as both a official language and the medium of education in India. Though this was vehemently opposed by Indian nationalists at that time, it has helped Indians to take advantage of Globalization at multiple levels.

    I am Indian, from a city called Chennai, and I believe if every outsourcing center in India decides to have a statue of someone, it should be that of Thomas Babington Macaulay.
  • sethstorm
    I thought it'd be Carly Fiorina and those who lead NASSCOM, both of which whom helped in diverting work to your part of the world.

    /sarc
  • vjdotbright
    Carly Fiorina and NASSCOM could not have done it if we hadn’t learnt English.

    Anyway, we - the people from a job stealing Third World country called India – also drive ford cars, use GE appliances and drink diet coke without complaining that the US corporations are stealing jobs away from Indian car manufacturers, appliance makers or soda producers. The job-stealers from Third world countries cannot afford these first world luxuries without ‘stealing’ jobs. It isn't fair to expect them to pay for first world Chevys and MS offices by doing third world jobs like, say, rearing cattle around their slums.
  • sethstorm
    As for the first part(re: English): I agree.

    It is because (at this time) those corporations wish to seek your favor. Just be prepared for when they move to the next region of the world and treat you as they treat the United States and Western Europe - with contempt.

    My concern is the complete change in perspective that favors developing countries over ones that have fully industrialized and moved up to being developed countries. That has cut out a lot of quality and certainly offended a LOT of people(myself being one of them) in those developed nations.

    I'm not asking you to give up anything in your nation that you enjoy. It's that there are more than a few things in my part of the world that being torn out in the process. Think of it as a wrecking ball that comes through an occupied(and well-built) house, and the operator just says "Sorry!" and goes on until there's very little left.
  • vjdotbright
    Yes, I agree. I am sure these jobs will soon go away from India to Somalia or Ethiopia. If the Governments do not build artificial barriers, prosperity, like water, will tend to maintain its level.

    I understand your point and I know what it means to be swept away by changes beyond our control. But, as someone who has seen poverty in India and Ethiopia, I can tell you, "being torn out" in the US is million times better than being poor in one of these countries.

    In India we have tried charity; we have tried world bank; we have tried central planning; nothing worked. But this globalization seems to be working. The families that were living as 'untouchables' with less than a dollar a week are now sending their sons to sweep the IT parks; may not be a great step forward. But, in those corridors of IT parks, this guy is no longer ostracized because of his caste. I would call it a giant leap. Let’s give him some more time.
  • Economiser
    The greatest human achievement of the next 20-50 years will be lifting hundreds of millions of people in developing countries up from poverty to a first-world lifestyle. I can't wait to see it happen.
  • vidyohs
    I hate to poop on your party, sir, but your post reflects the thinking that has contributed the most to why those poverty stricken countries have never developed.

    In my life time I have seen the effort made over and over, in place after place, and it isn't until the people actually want it, more than hatred, tribalism, religious factionalism and dominance, that something happens, and so far not much has happened.

    It is virtually impossible to "lift" some one who does not cooperate in the lifting or want to be lifted. No one can "give" any one education, ambition, training, or even inspiration if the recipient does not want it or believes he will get sufficient rewards any way.

    Then how do you educate a people whose leaders don't want them educated, leaders who want to keep them poor and controllable?

    People, individually or collectively, have to want to change, have to want to make the effort, have to want more, and have to learn that the surest way to have all of that is to do it yourself.

    Examine most, if not all, the poverty stricken nations of the world and see if you can spot the ones that have really made a sustained effort to "go for it". You'll find rare individuals, but they seem to run into the brick wall of complacence, unwillingness, and outright resistance to change when they go out and try to motivate their neighbors.

    Not too many people willingly go against their enculturation.

    That the world would be better in every way if your dream comes true is a no-brainer. I am not optimistic.
  • dsylexic
    It would be hubristic to believe people in such places are complacent or unwilling to change to too encultured -if that is the right term.

    Isnt there a wee bit chance that colonialism had pushed these places a few decades further?. After all,in 1900 ,India had almost 20-35% of world GDP while the US was an emerging market. things change dramatically if you take a longer perspective.It is difficult to imagine which parts of the world will be 'first world' and which third world in the next few hundred years.
  • vidyohs
    I am sorry sir, but, do you not see the same complacency here in this rich nation? I do.

    How many pussies have I heard lament that "they sent my job overseas", and now I can't make payments on the things I bought in order to have the CEO lifestyle I was taught I deserved? Did you catch that sir, "my job", as if they created the job? Isn't that complacency of the rankest order?

    More than any other reason, America is in the position it is in because of foolish complacency that goes back for over a century. It is a fact that the people who make their living off the land can never become complacent because nature changes every time one turns around. When America became a nation where more people worked in industry than on the land, we begin to become more complacent because we were less exposed to the vagrancies of nature.


    Consider, there were actually people stupid enough to sincerely blame George Bush for creating Katrina and directing it to hit New Orleans. We have way too many people in this nation now that seem to think that government can make weather on demand.


    Now every one thinks they are owed some means of living. Isn't that complacency?

    Globalization occurred in the early 1990s at the latest, and I think Americans are going to have to adapt to have fewer toys and concentrate more on the necessities or else we are definitely not going to remain 1st world. That will drain away because, as Margret Thatcher said, "Sooner or later you simply run out of other people's money."
  • sethstorm

    Globalization occurred in the early 1990s at the latest, and I think Americans are going to have to adapt to have fewer toys and concentrate more on the necessities or else we are definitely not going to remain 1st world. That will drain away because, as Margret Thatcher said

    ...and she sold her country and its sovereignty to break a segment of the country. Result? More socialism and colonization by the Middle/Far East. She helped to take the England out of England; she will die seeing the most unintended of consequences unfold.

    The US is and always will be part of the First World. Asia, subcontinental India, Latin America, and Africa will always be the Third World and never a part of the First World.

    Perhaps the US should send some crippling reminder to a random, job-stealing Third World country that they are not for sale, no matter the circumstances. Then send Carly Fiorina and the H1-b supporters on a one-way trip there to paint the target.
  • Economiser
    I don't like having my parties pooped on any more than the next guy!

    I think we're talking about two slightly different things, and I wasn't very clear in my first post. I agree that outside efforts to "lift" developing nations out of poverty are going to fall flat. We've funneled billions of dollars of direct foreign aid to many poor countries and those donations have accomplished very little.

    What I do think (hope?) will happen is that as the developed world gets richer, market participants will come up with ways to bring acceptable substitutes of things we take for granted to the third world for prices cheap enough that people in the third world can afford them. That is, the basics will get so cheap that even the poorest will be able to have them. A pertinent example is the growing use of cell phones in parts of Africa, and the related use of those cell phones for monetary transactions in place of banks.

    Third world countries that can support a market economy (however stunted) will thrive, while those that can't will remain poor. The most dramatic gains will go to the families currently living in hovels who eventually will have lifestyles more similar to the current American poor.
  • vidyohs
    Okay, I understand you better now.

    But, my point remains, till they want it enough to shake off the old enculturation or realize it and overcome it through conscious effort, it is unlikely to happen.

    Again, my experience around the world down in the street level dealing with people on the lower strata of life, tells me it is always a huge mistake to judge or anticipate anyone, particularly people from poverty stricken nations to react like US citizens, when even here in the USA we can't find common ground.

    Case in point to consider, true story. About three years ago I was asked to film a two witness job on a Saturday morning. My first witness was a female nurse from Malaysia, who gave testimony on the case. When we finished her we called in the second witness, a male nurse, in his mid forties, from Nigeria. He took one look at my camera set up and panicked. He refused to do the deposition on camera and his lawyer pulled out of him the superstition that I would steal his soul by filming him. Think about that. A man with such an ignorant enculturation, educated to nursing standards that allowed him to get licensed and employed here in the finest medical center on the planet, still carries inside those barriers. If he were still in Nigeria, how long will it be before he gets to a point where he can accept doing the things Americans do in order to obtain the things Americans have?

    In the 21st century you are still dealing with an immense number of peoples around the globe who are locked into an ignorant enculutration that prevents them from responding or behaving like you and I, prevents them from being anything other than reactionaries.

    For further proof of my point just check out the postings of muirduck and DisingenuousKuehn here on this blog.
  • India is definitely an interesting place. I was in Bangalore for a conference two weeks ago, and last week was in Bombay to do some consulting. Nobody observes lanes on the roads. So when cars stop at a light, the cars behind them keep jockeying to fill in the spaces, much like a jar of gravel can still have sand added to it, and it can still have water added after that. Same with autorickshaws and cars and motor scooters and bicycles. A little bit of property rights would go a long way to making their intersections more effici
  • vidyohs
    You'll probably be surprised to learn that much the same intersection scenario played out in the Yokosuka, Yokohama, and Tokyo area in Japan with frequently as many as four vehicles crowded in at the light on a two lane highway. It was something we all had to adapt to when we got there and began to drive.

    When the light changed everyone raced to see who was going to fill the two lanes on the other side of the intersection. Japan is where I perfected instant starts and speed shifting.

    I understand what you meant by property rights in the context above, but I am not sure in Japan that was what was in play, hurry hurry rush rush, and some ego was in the mix.
  • playdumb
    My ignorance ....How would property rights improve the congestion at traffic junctions? Those cars poking their nose into the front vehicles butt infringing on property rights?
    actually having seen traffic junctions in India without traffic lights - is a good example of how orders emerge out of chaos
    I vaguely recall a CafeHayek post some months back about how accidents dropped in a town in Germany when most traffic signs were removed - the analogy is not perfect but hey...)
  • vidyohs
    The circumstances in the video contrasting the new and modern with the old and poor remind me very much of my first visit to Lagos, Nigeria in 1961.

    Nigeria had recently obtained its independence from Britain and was very enthusiastic about the future and becoming an economic power.

    But, our first liberty let us out in a city that had much the same aspect as Bangalore. It was my first real exposure to extreme poverty. I will never forget observing on one of the main thoroughfares a multistory building built of blue stone, glass, and gleaming metal, not too far from the old British country club, and in the alleyway on the right of that building was a cardboard hut/shelter housing a large family. The feature of this was that the alley was paved and about 25 feet wide. It had a slight slope to the center where an open sewer about 10" wide and 10" deep flowed, and which also went right through the family's hut.

    I can't say that the family used that sewer for any domestic uses such as washing clothes, and God I hope they didn't use it in any kind of consumption, but I could see no other source of water and this was well before the days of bottled water. Who knows.

    This, of course, was not the only the only example, just the most vivid. I won't even bother to talk about the sights in the central native market.

    The sickness and poverty I saw in my 3 visits there are something I will never forget, and I also will not forget how raw tribalism has contributed to keeping Nigeria from achieving that great hope. Frankly I am surprised it is still identified as an independent nation with much the same borders it had then. But then I think that of all the western Africa states I visited, and of course the borders of some have indeed shifted.
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