Tuesday, January 25, 2011

Capital Flight and Poverty

When the poor wage earner gets a bonus, he would probably buy local stuffs to improve the condition of his house -- money is spent domestically and creates more jobs. When the elite business owner gets high profit as a result of low wage payments, he brings the money out of the country to spend it as a tourista. The increase of monies flying out of the country creates an imploding pressure on the local industies.