Globalisation and labour standards: A look at Asia

Has globalisation led to a downward spiral where competition drives standar ds down in a "race to the bottom"? Should a "social clause" be introduced i n the World Trade Organisation (WTO) in order to prevent such a development ? This article examines the development of labour standards in China, South Korea and Indonesia in the last decades. In these countries, export-orient ed growth led to significant improvements in employment and income levels. The analysis suggests, however, that labour conditions except wages (workin g hours, safety etc.) matter for competition in labour-intensive industries . In China and Indonesia, investors from other Asian countries have put a d ownward pressure on labour conditions in some such industries. On the whole , however, globalisation has contributed to better labour standards in East and Southeast Asia.