Answer to Question #234086 in Microeconomics for Kart

Question

Wage inequality and globalisation: Has the move towards a more integrated South

African economy brought with it greater demand and supply mismatches

▪ How does globalisations affect the demand for high and low skilled workers across the

globe?

▪ Given that much of South Africa’s economic activity is based on the natural resources, do you think the country is ready to make the shift to a more technologically driven production process?

▪ As South Africa has a large contingent of unemployed and low skilled workers how do you see the integration process affecting the mismatch between the demand and supply

▪ Apart from the mismatches of supply and demand in the labour market, what other factors are largely contributing to inequality levels within the country?

Answer 1

Globalization tends to influence more demand for the high-skilled worker. This comes as advancement in technology has call for related-experts in the respective process to improve productivity. This has lowered the demand for low-skilled workforce.

Technology is designed to make work easier when handling some processes. Therefore, the country is ready on shifting to more technological production processes to meet the present job standards.

Mismatch in terms of technological level also tends to contribute to inequality levels in the nation. This comes as companies purchase devices which are beyond their maintenance level ending up as a burden to them.