[OPE-L] the global labor force and capital accumulation

From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Tue Jan 17 2006 - 18:45:38 EST


The Harvard "expert" has got to be joking - the majority of Chinese, Indian
and Russian workers do not work in international import/export industries,
and the more China, India and Russia privatise and corporatise public
assets, the more capital there is. Plenty assets there, but whether you can
trade in them, that is the question. In reality, there exists of course
vastly more capital than is actually tied up in physical assets, if
anything, an economic challenge of our times is a plethora of idle money
capital globally chasing the best interest rates. In addition, exchange
rates distort the picture - Chinese GDP at ppp becomes four times larger,
India's five times larger, Russia's nearly three times larger. The size of
the world bond market alone is said to have developed as follows, in
approximate figures, current dollars:

1996 $11 trillion
1999 $30 trillion
2000 $32 trillion
2001 $33 trillion (BIS estimate $37 trillion)
2004 about $40 trillion (own crude estimate)

In other words, since 1990, the amount of capital invested in bonds has at
least doubled and probably trebled, taking account inflation (the US CPI
rose about 43% or so since 1990, I don't have an exact figure just now).
Some estimates suggest the world bond market is about 50% larger than the
corporate stocks market, I haven't the time to calculate a figure just now
but that data does exist. Obviously bonds are only one component of total
capital reserves. Apart from other securities, Henry Liu has highlighted a
"dollar glut", i.e. foreign dollar reserves held by governments that aren't
used. Some data I've cited before:

2003 value of the world's stock market capitalisation (i.e. the market value
of equity capital of publicly listed companies) $31.2 trillion (of which EU
$7.7 trillion, USA $14.3 trillion, Japan $4.9 trillion)

2003 value of the world's debt securities (bonds, derivatives etc.) $52
trillion (of which EU $16.7 trillion, USA $22 trillion,
Japan $8.4 trillion)

2003 value of the world's commercial bank assets $40.6 trillion
(of which EU $18.1 trillion, USA $5.7 trillion, Japan $6.2 trillion)
(Source: http://www.imf.org/external/pubs/ft/gfsr/2004/02/pdf/statappx.pdf)

One of my intended projects was to analyse the structure of the global
labour force statistically - the ILO also provides lots of useful base data
for this, but like I say, didn't get around to it, and I cannot get funding,
and they say I'm too old for Phd. Paul Bairoch published an in-depth study
in 1968 called "La population active et sa structure" (The economically
active population and its structure - Bruxelles : Université Libre, 1968,
236 pp. series Statistiques internationales rétrospectives; vol. 1)
providing historical series. However he doesn't classify by employment
status all that much. The ILO now offers a useful CD with forty years world
data on it, the trouble though is that it isn't fully complete or fully
comprehensive insofar as some levels of detail are lacking. One still has to
refer to national data sources to complete the employment status picture, a
considerable amount of work.

In a wiki article, I've noted that in one World Bank study (brought to my
attention by Chris Harman) Deon Filmer estimated that 2,474 million people
participated in the global non-domestic labour force (I assume including
unemployed) in the mid-1990s. Of these 379 million people, worked in
industry, 800 million in services, and 1,074 million in agriculture. The
majority of workers in industry and services were wage & salary earners - 58
percent of the industrial workforce and 65 percent of the services
workforce. But a big portion were self-employed or involved in family
labour. Filmer suggests the total of employees worldwide in the 1990s was
about 880 million, compared with around a billion working on own account on
the land (mainly peasants), and some 480 million working on own account in
industry and services. http://en.wikipedia.org/wiki/Division_of_labour (the
ref is Deon Filmer, Estimating the World at Work, a background report for
World Bank's World Development Report 1995 (Washington DC, 1995).)
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=620678 However the
aggregates and definitions Filmer uses have to be scrutinised carefully.

Plenty of work for future researchers!

Jurriaan


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