Impacts of globalization on worker injury in host countries

Abstract

Purpose International expansion is an inevitable consequence for companies that are seeking revenue growth. Foreign direct investment (FDI) by global enterprises is a common route of such expansion. As companies invest abroad, competing interests cause concerns over the impact (both positive and negative) on the local labor force (necessitating corporate social responsibility) caused by FDI. Therefore, there is a logical link between FDI, a country’s labor force and globalization. The purpose of this study is to explore this untested relationship. Design/methodology/approach This panel study uses cross-country data from the World Bank to understand the pattern of influence of globalization on worker injury. A secondary data set of 36 developed and developing countries from 2003 to 2007 are gathered for this paper to analyze. Findings The results of this paper indicate that, companies are seeking to maintain higher levels of social responsibility should not only consider a framework such as ISO 26000 themselves but also they should encourage compliance from their upstream suppliers as well. Originality/value Goods for these companies are manufactured in Bangladesh, but unfortunately, a serious tragedy occurred when a building collapsed, resulting in the death of 1,127 people, which was not the first of such events in Bangladesh (The Associated Press, 2013). Inspired by this recent tragedy, this study examines possible connections between globalization and the factors that are associated with the incidences of worker injury. Globalization is a well-studied phenomenon, however very little has been done to examine its impact on worker injuries; this paper helps fill that gap.

A (time) series of unfortunate events: structural change, globalization, and the rise of occupational injuries

“…These studies do not rely on quasi-experimental policy changes and utilize composite measures of openness that are difficult to interpret. Accordingly, the findings of this literature are somewhat mixed: Stackhouse et al (2019) find that a globalization index (but not foreign direct investment) correlates positively with worker injuries, while Blanton and Peksen (2017) find that the policy 'posture' of governments is more important than actual flows of trade and investments, and Kerrissey and Schuhrke (2016) find that labour institutions are important determinants of injury rates but fail to find any effect of measures of globalization. In contrast, the exogeneity of the liberalization reforms in India, in conjunction with detailed information on different aspects of economic openness, allows me to draw more precise conclusions.…”

“…Third, the study provides the first credible empirical analysis of the effects of globalization of production on workplace injuries in the developing world. The existing empirical literature consists of a handful of cross-country studies (Kerrissey and Schuhrke 2016;Blanton and Peksen 2017;Stackhouse et al 2019) examining the effect of globalization on workplace fatalities. These studies do not rely on quasi-experimental policy changes and utilize composite measures of openness that are difficult to interpret.…”

Contagion and spillover effects of global financial markets on the Indonesian Sharia Stock Index post-COVID-19

“…Globalization is a phenomenon that occurs in the world. Globalization is considered the key to economic expansion for developing countries (Chambers & Dhongde, 2016;Stackhouse et al, 2019). Other studies also state that globalization can lead to increased dependence on capital markets (Baele, 2005;Chevallier et al, 2018;Vuong et al, 2022).…”