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The Economics of Sweatshops

http://www.nytimes.com/1997/06/22/weekinreview/in-principle-a-case-for-more-sweatshops.html

The title of this article is “In principle, a Case for More ‘Sweatshops’

Like the title suggests, the author pools together different leading economists’ opinions on how sweatshops can be a beneficial way for developing countries to modernize despite the torturous hours and low pay in the worker’s conditions.

By arguing that working at a sweatshop is not always the worst alternative for adults and children alike in certain countries, economists say that that such a job is not as unfair as many would believe.  In developing countries such as Cambodia, Indonesia and Malawi, where low wages and poor working conditions are often the norm, a sweatshop job can provide opportunities and escape to many unemployed and needy people from worser alternatives such as starvation and death while offering the indigenous norm in wages and working conditions (even if its much poorer than our country’s standards). This argument would explain why there are so many sweatshop workers employed today – they weighed the cost and benefits of working in a sweatshop and the benefits outweighed the costs.

The article then moves to analyze the positive effects of sweatshops on a economy as whole. Using examples such as Hong Kong, Taiwan, Korea, and Singapore, it mentions how it was through sweatshops and the manufacturing of things such as toys, shoes, apparel that each of these regions were able to increase their national income from 10% of American income to 40% within a single generation.

Lastly, the article rebuts those who criticize sweatshops for stealing jobs and wages from Americans and advocate for the end of sweatshop factories. Economists argue that having corporations close their factories in developing countries would only make matters worse and only hurt those who they were trying to protect in the first place. As a sweatshop factory closes down, the workers become unemployed and are left to face the alternatives they had tried to avoid.  Mr.Krug, an economic advisor, sums it up by saying ” My concern is not that there are too many sweatshops but that there are too few.” Echoing many others, Krug believes it is these very jobs, which in past acted as stepping stones for countries such as Singapore and Korea, that can bring many developing countries today out of backbreaking rural poverty.

After applying the cost-benefit principle, this lady here sews because it is better than any alternative

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