Sweatshops in the Global Economy

Estefanía Campos  | 24 de enero de 2017  | Vistas: 325

Benjamin Powell, director of the Free Market Institute and author of the book Out of poverty: Sweatshops in the global economy shares with students the insights of his research on the reality of sweatshops and their role in the global economy. He discusses the main arguments against them and gives clarity to the matter based on data and real cases.

He starts his presentation describing the common misconceptions and ideas about sweatshops in the United States, such as it being a high risk job for people’s health and safety, with low wages and poor conditions. One of the biggest wrong ideas is, that they promote forced labor. Anti sweatshop movements, according to Powell, focus the matter in a inadequate way and questions if the requirements they fight for actually give people higher living standards.

Powell later discusses how to determine wage according to the context of the country and the theme of productivity:

There’s nothing inherently wrong with the worker as the reason for low productivity.”

Later Powell analyzes the viral case of Wendy Diaz in an Honduran Sweatshop who allegedly was exploded because she was paid $0.31 and hour, however more than 15% in that country lived on less than $1.00 a day. There are some interesting facts about the protests against sweatshops that help understand the situation.

Workers in the Factories that are being protested in the United States are earning more than the average income in these countries.”

Wages are higher than the average, but what about working conditions? Benjamin explains how there is a mix of compensation where the employer and employee negotiate the benefits.

Later a Guatemalan case is also analyzed to talk about working conditions and the employees preferences. Child labor is also discussed and the economically activities that children are employed. Finally he talks about the good things activists can do.


Professor of economics and director, Free Market Institute