Question

Thomas Friedman argues that the world has been flattened, i.e., the economic playing field has been made more level to more people than ever before. On the other hand, academics like Richard Florida argue that the playing field is not level but highly uneven. Who, and what sector of the economy is Friedman really referring to? What are some of the ways that the world is and is not flat?

Answer 1

What Thomas Friedman implies by the flatness principle is that it is now much more easier to collaborate and communicate with people from different sectors of expertise and geograpies.

• Some of the arguments that he put forward in favor of flattening is the evolution of technology, rise of user friendly computers and "work flow software" that enables work collaboration among diverse sectors to create new information.
• In his theory of flattening, Friedman is implicitly referring to the manufacturing and services sectors of the economy.
• His arguments focus primarily on the rise of operations like Outsourcing and offshoring in India and China respectively which are consequences of globalization that integrated countries in their economic activities and made movement of goods and services easier.
• There is lesser and lesser 'friction' as countries get further and further globalised in their economic endeavours.
• He also emphasises on the impact of supply chaining by MNCs like Walmart that connect suppliers, retailers and consumers through a 'hyper efficient supply chain'
• The dramatic transformation in the availability and access to information with the advent of World Wide Web, Google and Yahoo! groups according to him are also major factors involved in the process of flattening.
• On the other hand arguments against this theory stress on the idea that 'death of the distance' is a myth. Despite rising globalization, countries still trade with nearby nations than farther accross.
• As Edward Leamer puts it, " for the creation of ideas, it takes a neighborhood" . He emphasises on the fact that only the most mundane tasks can be outsourced even with globalisation. There are limits to outsourcing anything more complex. This creates or sustains multitudes of friction and hence the friction free hypothesis of flatness is a myth.
• The most favorite argument against flatness is the rising income inequalities perpetuated by globalization. The idea that globalisation only makes the rich more richer and the poor poorer is against the notion of flatness atleast in the arena of income. Rising income inequalities are not ideal of a world that is becoming increasingly flat.