Download Economic Development, Globalization and Xenophobia: Exploring

Economic Development, Globalization and Xenophobia:
Exploring Turkey’s Attitude
Cem Özaykun
[email protected]
Abstract
The aim of this study is to discuss the underlying causes that prevent mobility of labor.
The welfare level of a country, labor’s importance on the global economy and the xenophobia
are all discussed as the factors that affect the labor mobility. The 21st century was expected to
be the century of globalization, a World without boundaries. However, ongoing wars and the
refugees seeking for asylum from those geographies raised the question of a troubled
globalization process. The economy blames the immigrants, refugees or foreigners as a
contributor to the troubled world economy. Understanding the development level of the
countries and their acceptance for foreigners is crucial factor in order to obtain prosperity in the
globalization process which is coming to a standstill. The mobility of workforce should be
encouraged, as in the case of mobility of capital, in order to reach desirable level of
globalization.
Keywords: Globalization; xenophobia; welfare; economic development; labor
mobility
Cem Özaykun, is Ph.D. student in Business Administration Department at Beykent
University, Istanbul. Graduated fom Koc University with B.Sc. in Computer Engineering in
2012, and continued his studies in business administration, graduated from Yeditepe University
with MBA in 2016.
1. Introduction
The flow of goods, capital and labor between the borders may considerably destroy the
global economy (Dancygier & Donnelly, 2013). Dolmas and Huffman (2004) point out that
“the importance of immigration in the world economy is often underappreciated. According to
United Nations data, in 2000 there were 175 million migrants living in 228 countries. This
amounts to 3% of the world’s population, or a population that is roughly the size of France,
Italy, and the United Kingdom combined.” The status of immigrants, the problems they face
with such as discrimination within the society and the concerns the host countries have about
the immigrants whether they cause unemployment or affect the host country’s economic
situation are all the factors that need to be analyzed (Hatton, 1994). Xenophobia as a factor of
fear of foreigners, and the xenophobia’s causes in a society all should be determined in order
to overcome the handicaps for the immigrant workers. Especially the economic well-being of
a country determined in the first hand to understand the xenophobic tendencies (Taras, 2009;
Van Der Veer, Ommundsen, Yakusho and Higler, 2011). GDP is an indicator to determine a
country’s economic situation. The shortcomings of GDP as a welfare indicator studied in
various literature (Stiglitz & Walsh, 2002; Case, Fair & Oster, 2012) and finding a measurement
method for social welfare is being discussed in the recent years. It can be said that a better way
to measure a country’s economic well-being is present. (Fleurbaey, 2008; van den Bergh &
Antal, 2014). This study offers a research proposal that examines the underlying causes of
xenophobia in the globalizing world economy while searching for the optimum tool to measure
the country’s welfare level in order to understand its xenophobic tendencies for the labor
mobility.
2. Literature Review
2.1 Economic Development Level
Selecting an appropriate tool to measure welfare of the state is important. The gross
domestic product (GDP) has been linked to social welfare of the state for a long time. Therefore,
GDP was accepted as the indicator of wellbeing of a society, especially for the politicians, while
its inappropriateness for this role criticized by the economists. (Fleurbaey, 2008; van den Bergh
& Antal, 2014). The calculation of GDP can be given as (1), where C denotes consumption, I
denotes investment, G denotes government purchases, X denotes exports and M denotes
imports (Stiglitz & Walsh, 2002)
GDP = C + I + G – X – M
(1)
The general belief is that as the GDP increases the social welfare also increases. But, as
can be figured out, the GDP formula lacks the indicators to measure the welfare of the state.
The GDP cannot explain the level of crime in society, leisure time of the citizens, the pollution
level, or even the income distribution of the state (Case, Fair & Oster, 2012). Danilishin and
Veklich (2010) state that “in the context of increasing global and regional risks, the sustainable
development directs the attention of anti-crisis policy makers to the early (strategic) planning
and management of resource potential of the area as well as improving public welfare.” To
further understand the social indicators of a state Human Development Index (HDI) can be used
(Fleurbaey, 2008). HDI, developed by United Nations (UN), reflects the development level of
a country by applying its own distinct indicators alongside economic well-being (van den Bergh
& Antal, 2014). The HDI is formed from three dimensions; long and health life, knowledge and
a decent standard of living (Figure 1). Long and healthy life dimension is calculated by the life
expectancy at birth, whereas knowledge dimension is calculated by the mean and expected
years of schooling and the decent standard of living calculated by the gross national income
(GNI) per capita ("HDI", n.d.).
Long and Healthy Life
Knowledge
A decent standard of living
Life expectancy at birth
Mean years of schooling
GNI per capita $
Life expectancy index
Education index
GNI index
Human Development
Index (HDI)
Figure 1: Human Development Index Structure ("HDI", n.d.)
The GDP listings according to the World Bank records and the United Nations’ HDI data
can be compared to further understand the phenomenon. According to the World Bank’s 2014
GDP data of countries which was published in 2016 and updated in April 2016; the top country
listed as United States with 17,419,000 USD GDP. China comes second with 10,354,832 USD,
Japan takes the third place with 4,601,461 USD, Germany has the 4th place with 3,868,291 USD
and the United Kingdom takes the 5th place with, 2,988,893 USD. Turkey listed as 18th with the
GDP of 798,429 ("GDP ranking", 2016). Again, if the World Bank’s GDP per capita based on
the purchasing power parity (PPP) is reviewed, it can be seen that Qatar takes the first place
with 140,694 USD. Macao SAR, China takes the second place with 139,767 USD, Luxembourg
takes third place with 98,459 USD, Singapore takes the 4th place with 82,763 USD and Kuwait
takes the 5th place with 73,245 USD. And Turkey listed as 59th with 19,787 USD (“GDP per
capita”, 2016). Examining the GDP and the GDP per capita based on PPP’s relation with
development level of a country, United Nation’s Human Development Report that lists the
countries according to their HDI can be analyzed. According to the report, surprisingly none of
the countries which were discussed in the World Bank reports listed in the top 5. Instead, top 5
places belong to Norway, Australia, Switzerland, Denmark, and Netherlands respectively with
the highest HDIs. If the highest GDP countries are looked for; USA is in 8th, China in 90th,
Japan in 20th, Germany in 6th, United Kingdom in 14th place respectively, and the highest GDP
per capita based on PPP countries ranked as; Qatar in 32nd, Macao Special Administrative
Region of China or Taiwan Province of China not included, Luxembourg in 19th place,
Singapore in 11th place, and Kuwait in 48th place. Turkey which is listed in the 18th place
according to the total GDP in the World Bank report, and listed in the 59th place according to
the GDP per capita based on PPP, lists as the 72nd country (High Development Level) in the
UN HDI report (“Human Development Reports”, 2016). As it can be easily figured out there
are vast differences in the positions of the countries among the listings.
The data proves that GDP skips vital information about the welfare of the state. Because
of the living standards are not represented in the GDP, another measurement method is required
to determine the exact level of welfare (Jones & Klenow, 2010). Colman (2002) states that
“measuring progress by the sum of total economic activity is like a policeman adding up all the
street activity he observes. The lady walking her dog, the thief stealing the car, the children
playing on the corner, the thug hitting someone with a lead pipe are recorded equally. Our
growth statistics make no distinction between economic activity that contributes to our well
being and that which causes harm. Growth is simply a quantitative increase in the physical scale
of the economy, and tells us nothing about our actual well being and progress”. HDI can be
offered as an alternative method to measure welfare by including social indicators in to the
calculation but HDI has some flaws too in its three dimensional structure. Same birth rates and
life expectancies with the same economic indicators ranks countries with the same HDI whereas
they have different social statuses (Fleurbaey, 2008).
Recently, Herman Daly and John B. Cobb developed an extensive scale, Index of
Sustainable Economic Welfare (ISEW) which later evolved into Genuine Progress Indicator
(GPI) which emphasizes environmental and social factors (Hamilton, 1999) The GPI (Table 1)
is based on economic indicators, environmental indicators and social indicators (Hamilton
1999; Danilishin & Veklich, 2010; Hoffren 2011). Hoffren (2011) mentions that “Genuine
Progress Indicator (GPI) is designed to measure such economic welfare that can be sustained
over time and it can be applied both on national and sub-national level. GPI looks at the wellbeing from the consumer’s point of view. Personal consumption expenditure figures are the
starting point for GPI calculations since we are ultimately interested in welfare associated with
1
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4
5
6
7
8
9
10
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12
13
14
15
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25
26
Economic Indicators
Personal consumption expenditure
Index of distributional inequality
Weighted personal consumption expenditure
Cost of consumer durables
Cost of underemployment
Services yielded by consumer durables
Net capital investment
Net foreign lending/borrowing
Environmental Indicators
Cost of water pollution
Cost of air pollution
Cost of noise pollution
Loss of wetlands
Loss of farmland
Cost of resource depletion
Cost of long-term environmental damage
Cost of ozone depletion
Loss of old-growth forests
Social Indicators
Value of household and parenting
Value of higher education
Value of volunteer work
Services yielded by roads and highways
Cost of crime
Cost of leisure time
Cost of commuting
Cost of household pollution abatement
Cost of automobile accidents
+
+/+
+
+/+/-
GPI =
+
+
+
+
SUM
Table 1: GPI Indicators (Hamilton 1999; Danilishin & Veklich, 2010; Hoffren 2011).
consumption rather than the monetary value of production (i.e. GDP). While GDP counts all
economic activities as positive, GPI adds the value of benefits such as housework and volunteer
work and makes deductions for such things as declining environmental quality, disadvantages
of urbanization and increasing income inequality”. A retrospective study on the GPI change of
the USA with respect to its GDP shows the importance of GPI calculation on determining the
average increase in welfare of a state. The real GDP per capita of United States increased from
$15,000 to $36,596 in the years 1950 to 2004 with the average %3.81 growth rate. On the other
hand, the GPI per capita didn’t change in the same period as much as GDP per capita and stayed
around the $15,000 rate. It can also be said that there is a great stagnation in the GPI of United
States since the increase of GPI is around 1.33% (Talberth, Cobb & Slattery, 2007). Danilishin
and Veklich (2010) state that “consequently, when assessing public welfare, it is worthwhile to
consider the indicator of genuine progress as an alternative to the GDP. Measurement of GPI
enables more reasonable and accurate estimation of the environmental, economic, and social
efficiency of a country’s development and adoption of appropriate policies to adjust its progress
along the trajectory of sustainable development.”
2.2 Globalization and Labor
In the recent years, immigration has become a major debate issue all around the world.
The most common questions that rise with immigration are, do immigrants capable of adapting
to the new culture, or face with adaptation problems or discrimination? Do they take jobs from
locals and affect the economic well-being of the county? (Hatton, 1994). Chiswick and Hatton
(2003) state that “Globalization in the labor market is qualitatively different from globalization
of goods or asset markets. With international migration, the factor of production (labor services)
crosses national boundaries embodies in individuals. As a result, trading in goods and services
and capital flows are fundamentally different from trading in labor services (people).”
International Migration Database report of Organization for Economic Co-Operation and
Development (OECD) shows that in 2013 (the most recent available data) the flow of foreign
people by nationality for Germany was 1,108,068. The inflow for United States was 990,553
as the second largest, for United Kingdom it was 406,000 as the third largest, for Korea 369,267
as the fourth largest, and for Spain and Japan the inflow was 307,000 as the fifth largest flow.
It can be easily figured out that the phenomenon of migration takes place all around the world,
from Europe to Americas, and to Far-East ("International Migration Database", n.d.). Dolmas
and Huffman (2004) mention that “Immıgration patterns differ radically across countries: The
fraction of the population that is “foreign born” ranges from essentially zero in Vietnam to
between 70% and 80% in Qatar, the United Arab Emirates and Andorra. Australia, Canada, and
the United States, which account only 5% of the world population, have received three quarters
of the world’s immigrants in the 1990s. Immigration accounts for 40% of the US. Population
growth rate.” Therefore, policies that restrict immigration may be based on factors such as,
economy and unemployment rates, the number of immigrants a country accepts with respect to
its population, foreign policies, harmony of the society (Massey, 1999).
On the other hand, to emphasize the importance of accepting immigrants and their value
as a workforce for the acceptor country Carey (2011) gives the example of United States and
states that “one in seven persons in American workforce was born abroad. This includes
naturalized citizens, legal permanent residents, temporary workers, and those with no work
authorization. Contrary to popular stereotypes, they fill a wide range of occupations. They are
business executives and bus boys, Nobel Prize winners, nurses and nannies, doctors and dry
wall specialists. Our ability to attract and retain the best and the brightest, as well as those
willing to perform tasks for which most Americans are overqualified and reluctant to perform,
provides much of our competitive advantage in today’s global economy.” For a more striking
example of labor immigration Michael and Eugenia Brin can be mentioned. They were scholars
in USSR and applied for US refugee program in 1979 in order to work in US. They filled
reputational job positions in US. Furthermore, the value created by the immigration can be
emphasized by mentioning their son, Sergey. Carey (2011) states that “Sergey studied math and
computer science at the University of Maryland, where he graduated with honors. He went on
to Stanford for graduate studies. While at Stanford he and a friend rented a garage in Menlo
Park and founded a new company, Google, which now employs nearly 20,000 people and ranks
#4 on Fortune magazine’s list of the 100 Top companies to Work for. Had Sergey and his family
stayed in Russia, perhaps Google would now be based in Moscow instead of California’s
Silicon Valley. Or more likely, it wouldn’t exist at all, and those 20,000 workers would be
competing for jobs somewhere else.”
A study conducted by the Harvard: Kennedy School of Government shows that
interestingly half of the Americans believe that immigrants are taking the jobs, and affecting
housing and healthcare system in an undesirable way, while the other half believes that
immigrant are beneficial for the country because of their talents and quality of work. And, for
the legal status of immigration, majority believes that if it is legal, than migration helps the
economy of the country (Delener & Ventilato, 2008). Also, Nicolae (2013) states that
“Regarding the country of origin, short term migration has beneficial effects: reducing
unemployment, alleviating poverty, developing entrepreneurship among migrants, increasing
incomes, attracting investors from the country of destination. In the long run, however, are
negative effects of migration: labor shortages competitive, low intellectual resources of
population, leading to a decrease in GDP, brain drain, etc. aging population. In terms of
destination countries, the positive effects are stronger than the negative, their economies benefit
from having qualified migrants.”
2.3 Xenophobia
A society’s level of democracy can be understood from their treatment of the foreigners.
When the economic uncertainty about the country’s future is high foreigners can be seen as
threat to the country. Insecure economies and the increased anxiety of the individuals about
their future can give rise to xenophobia. Xenophobia is fear or hatred of strangers or foreigners
and xenophobes are the people who have negative view about them. Ethnocentrism, closemindedness and intolerance are all linked with increased xenophobia in a society (Taras, 2009).
To further analyze the xenophobia’s effects on the country level, a research conducted on
the Unification of European Union shows the relationship between xenophobia and acceptance
of unification. Nationalism is the most prominent factor against unification while the multicultural groups with various backgrounds supports the unification process. For the religion,
Roman Catholicism is an all accepting religion in nature, and embraces internationalism, and
Greek Orthodox community displays in lesser xenophobic inclination while Protestants and
secularists have higher xenophobic tendencies in the Union (Master & Roy, 2000).
From the perspective of ethnocentrism, which may relate to xenophobia, economic
nationalism and openness to globalization, a country’s demographics, development level and
nationalism are all the determinants of it. Again, the economic uncertainty is the most
prominent factor that affects the country’s ethnocentric tendencies. For example, although US
is a developed country, its nationals are more ethnocentric than China. This phenomenon is
directly linked with the perceived economic uncertainty of the two countries. China believes in
its economy and the citizens believe job security, on the other hand, US citizens are concerned
with their future (Tsai, Lee, Song, 2013). On the other hand, the mobility of the international
capital increases openness to foreigners. Dolmas and Huffman (2004) state that “international
capital movements can also have a significant impact on an economy’s openness to immigrants.
In particular, the more mobile is international capital, the less likely is it that natives will be
opposed to immigration. This is because, with a constant returns-to-scale technology, equal
proportions of capital and labor can be imported, leaving the returns to labor and capital
unchanged.”
Taran and Geronimi (2003) point out that “most permanent immigrants and refugees –as
well as migrant workers- seek remunerative activity, participate in the labor force, and face
discrimination and xenophobia directed at foreigners in host countries.” Therefore the roots of
the xenophobia should be found in a society. Questions such as “Immigrants take jobs from
people who are here already” or “I am afraid that in case of war or political tension, immigrants
will be loyal to their country of origin”, or “with increased immigration I fear our way of life
will change for the worse” could be asked to the population (Van Der Veer, Ommundsen,
Yakusho and Higler, 2011). In order to measure the level of xenophobia in a society the number
of scales that can be used relatively few in the literature with respect to other fields. A scale
developed by Van Der Veer, Ommundsen, Yakusho and Higler (2011) and entitled as CrossNational Measures of Fear Based Xenophobia (Table 2) can be applied to measure the desired
xenophobia level in the population. Van Der Veer et al. (2011) states that “despite wide-spread
xenophobic attitudes, the research on anti-immigrant attitudes has not yielded a
psychometrically sound and cross-nationally validated measure. The current study summarizes
the development of a unidimensional scale measuring xenophobia for use in Western
immigrant-receiving nations.”
1
2
3
4
5
6
7
8
9
10
11
12
13
14
*
Immigration in this country is out of control.
Borders should be made more secure to prevent immigrants from entering this country.
Immigrants cause increase in crime.
Immigrants take jobs from people who are here already.
Interacting with immigrants makes me uneasy.
I enjoy interacting with immigrants (R) *
It is OK for immigrants to stay close to their cultural roots. (R)
I would welcome interaction with immigrants. (R)
I worry that immigrants may spread unusual diseases.
I am afraid that in case of war or political tension, immigrants will be loyal to their
country of origin.
I trust immigrants will support my country in times of crisis. (R)
With increased immigration I fear that our way of life will change for the worse.
I doubt that immigrants will put the interest of this country first.
I am afraid that our own culture will be lost with increase in immigration.
R means the item must be reverse-scored.
Table 2: Xenophobia Items (Van Der Veer, Ommundsen, Yakusho and Higler, 2011)
3. Research Recommendation and Conclusion
The Genuine Progress Indicator for Turkey must be determined in order to understand
the welfare level of the state. The economic, environmental and social indicators that are
determined in the GPI should give details about the Turkey’s current level of economic
development, and society’s welfare rather than the GDP approach or UN’s Human
Development Index indicator. Since GPI includes factors such as pollution or leisure time, it
has a broader perspective than just measuring the economic factors or educational indicators.
The calculated GPI values will not only beneficial for this research but they can also be used in
various contexts, and in further researches about the Turkey’s welfare level. Also, a study may
calculate the retroactive change of GPI values (if the indicators are available) for Turkey to see
the change in the welfare of the state over the decades.
The labor statistics, both for native and migrant population, who born outside the country,
must be collected and compared. The change in employment rates and if there is a takeover in
native jobs from immigrants can be deduced from the data obtained. The immigration may have
positive or negative consequences in the economy of the state, therefore a detailed analysis of
the obtained data is crucial to determine the exact nature of labor immigration in the state.
Xenophobia level of the society should be measured by the scale, Cross-National
Measures of Fear Based Xenophobia, provided by Van Der Veer, Ommundsen, Yakusho and
Higler, 2011. The obtained results from the scale can be compared to the GPI level of the
country and the immigrant labor statistics of the state. For a further research the answer for “is
there a relationship between the welfare of the state -or the GPI level of the state- and the
xenophobia against immigrant labor?” can be researched for the population.
In the globalizing world it is important to understand the problems that move
globalization to a standstill. As the capital moves beyond borders, also the labor must be able
to move without facing any restrictions or discriminations. Unfortunately, some policies are
trying to restrict the immigration between countries. Furthermore, immigrants are facing with
discrimination within the countries they live. Consequently, analyzing a country’s development
level, the perspective for labor migration, and its xenophobic tendencies are crucial issues. The
research offered in this paper can not only be applied in Turkey but also in other countries in
order to grasp the nature of the discussed phenomenon in the world.
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