A Cost and Benefit Analysis Model for Globalisation: Some Social Welfare Implications of Thailand’s Globalisation Process
Undoubtedly the most striking feature of the globalisation process has been financial liberalisation. In principle, financial liberalisation is the process whereby a country seeks to increase its competitiveness and growth by freeing up its financial system for international capital through reforming trade, foreign exchange policy, capital controls and the domestic financial market. The ultimate aim of globalisation and financial liberalisation is to foster economic growth. This chapter analyses the benefits of these two interdependent and intertwined processes from a social welfare perspective. Various inter and intra-dependent development issues, processes, innovations and public policies have intersected and accelerated social and economic change resulting in what is commonly referred to as globalisation over the past three decades (Bird and Rajan 2001; for a review of the welfare and political issues see Sen 1999; Gilpin 2001; Islam 2001a). Globalisation is widely considered to be a contributor to global prosperity.
This chapter proposes, develops and applies a welfare economic framework with a focus on a cost-benefit analysis of the intra-country sharing of the development impact of global prosperity from globalisation and states the resultant welfare economic, development strategic and public policy perspectives.
This chapter is structured as follows: Section 8.2 presents a brief review of the Thai experience of globalisation and financial crises. Section 8.3 introduces the welfare economics framework. Section 8.4 introduces the illustrative cost benefit analysis. Section 8.5 present welfare analysis of the results of this illustrative exercise. Finally Sect. 8.6 presents a summary conclusion.
KeywordsSocial Welfare Social Choice Social Welfare Function Social Choice Theory Financial Liberalisation
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