James McConvill and Mirko Bagaric: Global risk of feeling flat

As usual when there is a WTO meeting, public debate centres on the political and economic aspects of freeing global markets and encouraging international trade.

But one issue that has not received much attention is whether there is a positive correlation between international trade and levels of personal happiness.

An acceleration of globalisation may lead to job creation (particularly in developing countries), richer economies and product innovation but we must remember that our ultimate desire as human beings is to be happy, and that the economy is simply a part of society, albeit an important one.

Thus, before we sign off on rapid connectedness of the world's markets via the WTO, we should at least consider the potential implications in terms of the level of happiness.

If aggregate happiness will potentially shift down rather than up as a result of further globalisation and more international trade, we should reassess our commitment, even if it comes at the expense of some financial gain.

One of the main contemporary advocates of globalisation, Thomas Friedman, has argued in The World is Flat: A Brief History of the 21st Century, that because of globalisation, the world has become smaller over the past few centuries, particularly this century. According to Friedman, the world has become increasingly "flat".

This "flattening" process raises an interesting issue. Research shows that individuals are likely to be happier, and be capable of increasing their overall happiness, when they feel part of the community.

Being part of a close community, and participating in the various activities that build "social capital" (a sense of society and social interaction) is one of the main generators of happiness for individuals.

Therefore, if globalisation makes the world "smaller", would this not contribute to net happiness, or is it the case that the opportunity cost of greater connectedness of markets, and a general "opening up" of the world by trade, is a loss of the sense of local community?

In Bowling Alone: The Collapse and Revival of American Community, Harvard sociology professor Robert Putnam points to a decline in social capital in the United States over the past 30 years, and discusses the implications of this trend.

As Putnam argues: "A society of many virtuous but isolated individuals is not necessarily rich in social capital."

He explores the effect of mobility and sprawl on social capital, and hence happiness, which is important given that mobility and sprawl are two key effects of globalisation.

Feeling that one is involved in a smaller and more intimate daily routine is more likely to mean one will get involved in community affairs.

While flattening may make the world smaller in one sense, levelling the playing field also opens up the world for many people, leading to increased activity and providing for a picture of the world as a more dynamic and encompassing creature.

This can provide much in the way of economic capital but at the expense of building, or even maintaining, social capital.

Sacrificing social capital to build economic capital may achieve certain material gains at the expense of health and happiness.

Canadian philosopher John Ralston Saul has also highlighted the weakness of assessing globalisation and international trade according to conventional political and economic terms.

While Saul does not engage with the recent literature on human happiness and social capital, he does point to the importance of community, and warns against sacrificing social bonds to achieve economic gains.

In The Collapse of Globalism and the Reinvention of the World, Saul argues that, despite all the rhetoric about the virtues of globalisation and pursuing international trade, a strong sense of community may be what we need.

According to Saul, rather than accepting international trade as something to be seen purely in a positive light, public policy should instead be focused on the nation state and the benefits that derive from nationalism.

In other words, more is going on in the world than just economics, and progress isn't intricately connected with looking at the world through an economic prism.

As more research is conducted into human happiness and social capital, it will be interesting to see whether the empirical studies back up Friedman's strong advocacy in favour of globalisation, or whether a decline in happiness levels as suggested above bears true.

It is a shame that this aspect of the international trade debate will not be directly raised at the WTO's Hong Kong meeting.

* James McConvill is a senior lecturer at La Trobe Law School in Melbourne; Professor Mirko Bagaric is Head of School at Deakin Law School, Melbourne. Their new book, International Commercial Law: Themes, Principles and Policy, will be published by Oxford University Press next year.