Globalization, Institutions and Social Cohesion

Globalization, Institutions and Social Cohesion

Springer-Verlag Berlin Heidelberg GmbH

Maurizio Franzini. Felice R. Pizzuti Editors Globalization, Institutions and Social Cohesion With 19 Figures and 29 Tables Springer

Prof. Maurizio Franzini University of Siena Dip. Economia Pubblica Piazza S. Francesco, 7 53100 Siena Italy franzini@unislit Professor Felice R. Pizzuti University of Rome "La Sapienza" Dip. Economia Pubblica Fac. Economia Via del Castro Laurenziano, 9 00161 Rome Italy pizzuti@dep.eco.uniroma1.it The foreword by D. Tosato, the introductions by. F. R. Pizzuti and M. Franzini, as well as the articles by: M. de Cecco, F. Sanna-Randaccio, L. M. Milone, M. Franzini, R. Schiattarella, F. R. Pizzuti, P. Onofri, C. A. Ciampi, F. Farina have been translated by Robert Barone. The original Italian edition is: Felice Roberto Pizzuti (editor): "Globalizzazione, istituzioni e coesione sociale", Donzelli editore, Roma, 1999. ISBN 978-3-642-08724-0 ISBN 978-3-662-04407-0 (ebook) 001 10.1007/978-3-662-04407-0 Library of Congress Cataloging-in-Publication Data Die Deutsche Bibliothek - CIP-Einheitsaufnahme Globalization, Institutions and Social Cohesion 1 Maurizio Franzini; Felice R. Pizzuti ed. - Berlin; Heidelberg; New York; Barcelona; Hong Kong; London; Milan; Paris; Singapore; Tokyo: Springer, 2001 Einheitssacht.: Globalizzazione, istituzioni e coesione sociale <eng!.> This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation are property of the edition of the Italian version Prof. Felice Roberto Pizzuti, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer-Verlag. Violations are liable for prosecution under the German Copyright Law. Springer-Verlag Berlin Heidelberg 2001 Originally published by Springer-Verlag Berlin Heidelberg New York in 2001. Solkover reprint of the hardcover 1 st edition 2001 The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Hardcover-Design: Erich Kirchner, Heidelberg SPIN 10724892 42/2202-5 4 3 2 1 0 - Printed on acid-free paper

Foreword The Department of Public Economics of the Rome University "La Sapienza", in keeping with its primary task of promoting research, not only inside the Department, but also through an exchange of ideas with scholars from Italian and foreign research institutions, periodically organizes conferences and meetings on the important topics of economic theory and policy. Economic globalization clearly belongs to this category. Just consider the widespread effects and consequences of globalization, the range of tools that its analysis requires as well as its impact on the welfare of the populations involved, and the new difficulties it brings about in terms of methods and results of public and regulatory interventions. Therefore, on this very subject, the Department of Public Economics invited a group of scholars, who have been deeply involved with the questions raised by economic globalization, to a direct confrontation. The aim of this conference was to deepen awareness of the phenomenon and its specific impact on the advanced economies of our continent, as well as to formulate proposals for action on both the national and super-national level. This volume, which collects the contributions presented at this meeting, gives an account of the deliberations that took place at the Conference "Globalization, Institutions and Social Cohesion" held at the Faculty of Economics of Rome University "La Sapienza" from the 15th to the 17th of December 1998. The Conference was organized with both passion and intelligence by Felice Roberto Pizzuti and Maurizio Franzini - who deserve the hearty thanks of the Department for their profound commitment. Professor Pizzuti's introduction gives a very useful synthesis of the subjects treated, of the concerns that were expressed, and of the positions outlined. Anyone who, like me, had the opportunity to follow the works of the conference and who can now revisit it by reading the articles collected in this volume, would certainly be struck by the range of ideas and research that emerged. On the level of analysis, the articles invite us to question the special aspects that distinguish the current phase of the globalization process from the rapid development that occurred in previous episodes of international trade and of economic integration. The articles also propose an examination of the theoretical analysis that is best adapted to evaluate the dimensions and the distribution of costs and benefits that derive from globalization, and of the consequences for macroeconomic equilibrium of the single economies in reference to the nature of the productive structure and of the labour market. In terms of economic policy, the articles invite us to reflect on the measures and the means of support towards those who risk becoming emarginated; and, on the new equilibrium that is being sought between public intervention and private initiative, on the one hand, and between regulatory powers entrusted to national and super-national authorities, on the other. It is specifically on these last points that the thoughts expressed by the then President of the Interim Committee of the International Monetary Fund and Minister of the Italian Treasury, Carlo Azeglio Ciampi, who is now President of the

VI Foreword Italian Republic, take on a special importance. On behalf of the Department, I want to thank President Ciampi once again for his valuable contribution to the works of the Conference. And with the certainty that the ideas that emerged from the conference on "Globalization, Institutions and Social Cohesion" will continue to be fruitful, the Department of Public Economics is proud to present this volume to the attention of the academic world. Domenico Tosato Director of the Department of Public Economics Rome University "La Sapienza"

CONTENTS Foreword Domenico Tosato Introduction "Markets and Institutions in Neo-Globalization" Felice Roberto Pizzuti Introduction to the English Edition Maurizio Franzini v 1 23 Part I : Precedents and Prospects of the Current Processes of Globalization 1. Comparing 2000 with 1900: How Does Today's Globalization Differ 31 from Yesterday's Free Trade? Peter M. Oppenheimer 2. Financial Globalization: Specificity and Historical Differences 47 Marcello de Cecco 3. Globalization and Foreign Direct Investments: Towards a New 59 Protectionism? Francesca Sanna-Randaccio Part II : Neo-Globalization and the Labor Market 4. Globalization, Localization of Production Activities and Income Distribution in the Advanced Countries: an Overview Luciano Marcello Milone 5. Globalization, Profits and Salaries Maurizio Franzini 6. International Relocalization and Employment: an Analysis for the Traditional Italian Industries Roberto Schiattarella 7. International Labor Standards and Child Labor Kaushik Basu 75 85 99 115

VIII Contents Part III : Neoglobalization, the Welfare State and Social Cohesion 8. Globalization, Welfare State and Social Dumping 127 Felice Roberto Pizzuti 9. Globalization, Growth, Inequalities and Democracy: a New Perspective 159 Jean Paul Fitoussi and Xavier Girre 10. Global Flexibility: Economic Integration, Social Disintegration? 167 Guy Standing 11. Globalization and Social-Policy Instruments in Europe 183 Paolo Onofri 12. Globalization and Social Equity 201 Ferruccio Marzano 13. Multinational Corporations and Global and International Models of 209 Pension Provision: Evidence from Ireland Gerard Hughes Part IV : The Neo-Globalization, the Institutions and the Experience of European Integration 14. Globalization and the Reform of the International Monetary System 229 Carlo Azeglio Ciampi 15. Globalization, Regionalism and the Nation State: Top Down and 237 Bottom Up Pier Carlo Padoan 16. Financial Liberalization, the European Single Currency and the 257 Problem of Unemployment Annamaria Simonazzi and Fernando Vianello 17. Monetary Policy and Competitiveness in the Euro Area 283 Francesco Farina