International Headlines: Economics


Four Top Economists on South Korea’s Severe Income EqualityJuly 14, 2015 The Hankyoreh “Unequal Korea: Dreams of a Welfare State,” a recently published collection of research findings by 30 of the country’s top researchers on the topic of inequality, provides a grim glimpse of the pall inequality casts throughout South Korean society: 73% of men in their fifties fell out of the middle class by their sixties. The top earning 0.01% makes 167 time the average income of all adults over 20. 63% of people making less than the minimum cost of living have been poor for 5 years or more. The mortality rate of those who only complete middle school or less is 8.4 times that of university graduates.

9 Ways the TPP is Bad for Developing Countries July 08, 2015 One issue surrounding the Trans-Pacific Partnership (TPP) that has received comparatively little attention is how the TPP is likely to impact the developing countries slated to join. The UN designates six of the 12 TPP members -  Brunei, Chile, Malaysia, Mexico, Peru, and Vietnam as “developing countries.” If enacted, the TPP could block these countries from successfully industrializing and joining the developed world. Blocking industrialization would mean locking these countries into low-end agricultural and extractive industries, preventing tens of millions from accessing higher-paying jobs in the manufacturing and service sectors. Domestic tax bases would stay too low to adequately finance social protection, investment in health, and education, high levels of poverty would remain, and the cost in human potential would be all but incalculable. Some of the methods the TPP would use include forbidding the use of trade policy to protect domestic industry, banning the use of government procurement to assist domestic firms, undermining sovereignty of national courts, blocking companies from acquiring needed technology by hampering reverse-engineering, undermining state-owned companies, and generally insisting on applying “equal” rules upon unequal partners.

New Leaked TPP Chapter Shows Countries Converging on Anti-User Copyright Takedown Rules July 07, 2015 A draft of the Trans-Pacific Partnership (TPP)’s “Intellectual Property” chapter from May 11, 2015 has recently been leaked. One area in which significant progress has been made is intermediary liability rules. The new change involves the immunity that Internet companies enjoy from copyright liability, provided they satisfy certain safe harbor conditions. Under the US’ Digital Millennium Copyright Act (DMCA), those conditions require Internet intermediaries to comply with a “notice-and-takedown” process. This has seen legitimate content taken down in response to bogus claims of infringement, as well as misuse for political censorship. One point of contention has been whether countries that don’t already have an equivalent to the DMCA’s rules would be forced to adopt one. Several TPP countries, like Chile and Japan, already have systems significantly better that require review before content takedown. The US will likely accommodate at least some of these existing regimes rather forcing the DMCA on its partners. Yet, intermediary liability rules are more than a trade issue; it is an issue that impacts human rights, since it is only when shielded from liability that intermediaries are incentivized to foster users’ freedom of expression and association online.

Extreme Poverty in Venezuela Drops to 4.5% July 28, 2015 Telesurtv The number of Venezuelans in extreme poverty has dropped to a historic 4.5%. This was despite the economic war being waged by the elite against the government. The figure is nearly half that of its neighbor Colombia. When President Hugo Chavez was elected in 1998, 21 percent of homes were registered as living under extreme poverty. The drop in extreme poverty has been due to a skyrocketing of social missions addressing the basic needs of Venezuelans by the government.

Key things to know about China's market meltdown July 9, 2015 CNN China’s stock market is crashing as its bubble burst. Even as the wider economy was slowing down, the stock market was rising. The People’s Bank of China is doing all it can to support share prices out of fear that a crashing stock market will affect consumption. While foreign investors only hold 1.5% of Chinese shares (due to government restrictions), the crashing stock market might create an economic slowdown that will impact other places that supply China’s raw materials.