The Race to the Bottom, from the Bottom

Nancy H. Chau () and Ravi Kanbur

Economica, 2006, vol. 73, issue 290, pages 193-228

Abstract: The dominant perspective in discussions of labour and environmental standards and globalization is that of North-South competition and its impact on Northern standards. This paper presents an alternative perspective, that of South-South competition to export to the North and its impact on Southern standards. It develops a simple model of Southern competition, and demonstrates that whether a Southern race to the bottom is possible depends intricately on the Northern demand curve, the size of large exporters relative to each other and the relative size of the competitive fringe of small exporters. The possibility that Northern trade protectionism may undermine Southern standards is also examined. Copyright (c) The London School of Economics and Political Science 2006.

Date: 2006
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Working Paper: The Race To the Bottom, From the Bottom (2001)
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