Power imbalance, negative externalities and the amplification of wealth inequality.

Negative externalities

Over the past several centuries, profit-driven multinationals have perfected the art of selling premium products for colossal profits. The majority of the products they sell are made from valuable commodities purchased at rock-bottom prices and produced without any attention given to the negative impact (externalities).


Development aid

This system of buying low and selling high has created an enormous power imbalance in the world. So great is the disbalance that it is virtually impossible for developing economies to grow or upstream their place in the value chain in order to reap their fair share of the value created. Even those countries ‘rich’ with valuable commodities like coffee, cocoa and tea have little or no prospect of ever catching up.

Unequal distribution

The resulting increased concentration and unequal distribution of wealth is behind much of the world’s social and economic instabilities. Development aid is a noble attempt to compensate for the global inequality but it mask the underlining problem of unequal supply chains. In the post-colonial period 24 x time more value was taken out of the global South by large multinationals from the global North than development aid was given by their governments.
“Market forces and capitalism by themselves aren't sufficient to ensure the common good and to limit the concentration of wealth at levels that are compatible with democratic ideals”.
Thomas Piketty


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