Globalization, Immobility of Labour and Income Disparity

Abstract

While I agree that labour mobility is restricted in comparison to commodity or capital flows, as the saying goes ‘necessity is the mother of all inventions’. Commodity flow was limited in the 18 th and 19 th century with countries resorting to various tariff and non-tariff barriers with the objective of protective their domestic industries. As governments across nations realized the need of encouraging trade with other countries they entered into bilateral free trade agreements with them. With time the concept of free trade areas set in where economic integration was seeked for by removing trade barriers among members but each country determines its own barriers against nonmembers. ( NAFTA the one of the biggest free trade agreement took place in 1994 among USA, Canada and Mexico)