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RACE TO THE BOTTOM definition: a situation in which companies compete with each other to reduce costs by paying the lowest wages…. Learn more.
- What Is The Race to The Bottom?
- Understanding The Race to The Bottom
- The Race to The Bottom and Labor
- The Race to The Bottom in Taxation and Regulation
- Example of A Race to The Bottom
- The Bottom Line
The race to the bottom refers to a competitive situation where a company, state, or nation attempts to undercut the competition's prices by sacrificing quality standards or worker safety (often defying regulation), or reducing labor costs. A race to the bottom can also be between governments to attract industry or tax revenues. For example, a juris...
Supreme Court Justice Louis Brandeis is generally credited with coining the term "race to the bottom." In a 1933 judgment for the case Liggett v. Lee, he stated that the competition between states to entice companies to incorporate in their jurisdiction "was one not of diligence, but of laxity," meaning states were relaxing rules and regulations in...
The phrase race to the bottom is often applied in the context of labor and staffing. Many companies go to great lengths to keep wages low to protect profit margins while still offering a competitive product. The retail sector, for example, is often accused of engaging in a race to the bottom and using wage reduction and benefits cuts as easy target...
In order to attract more business investment dollars, states and national jurisdictions often engage in a race to the bottom by changing their taxation and regulation regimes. The disparity in corporate tax worldwide has seen companies shift their head offices or move operations to obtain a favorable effective tax rate. There is a cost to lost tax ...
While globalization has created a fertile market for the exchange of ideas and trade between countries, it has also resulted in fierce competition between them to attract trade and investment. Large multinational corporations are an especially favored target and the competition is intense among low-income countries hungry for foreign direct investm...
A race to the bottom occurs whenever competition becomes so endemic that it leads to negative consequences and externalities. For instance, businesses may cut corners and sacrifice quality in order to maintain low prices and keep market share. Governments may also reduce taxes and reduce regulations and environmental standards in order to attract i...
Race to the bottom. Race to the bottom is a socio-economic phrase to describe either government deregulation of the business environment or reduction in corporate tax rates, in order to attract or retain economic activity in their jurisdictions. While this phenomenon can happen between countries as a result of globalization and free trade, it ...
Jan 30, 2024 · The “Race to the Bottom” is a term used to describe a pervasive tendency among individuals to prioritize low costs and instant savings in their financial choices. It manifests in various aspects of personal finance, including spending habits, investment decisions, and even career choices. At its core, the Race to the Bottom is about seeking ...
Jan 31, 2024 · Race to the bottom refers to a phrase used in economics to describe the event of intense competition among companies, regions, or nations to become the winner and maintain the best position turning detrimental to the interest of stakeholders and competitors involved. For example, the companies usually compete to gain the market share, whereas ...
Definition of race to the bottom in the Idioms Dictionary. race to the bottom phrase. What does race to the bottom expression mean? Definitions by the largest Idiom Dictionary.
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Nov 27, 2019 · Essentially the notion of a race to the bottom describes a view of government deregulation of the business environment. A world where companies cut costs – and wages – in order to be more ...
