One from the Many: The Global Economy Since 1850

"If inflation has been the big economic story of the last four years then trade might be the big economic story of the next four years. This book zooms out on the ups and downs of not just trade but other forms of globalization like capital movements over the last 170 years. It focuses on three periods: pre-WW I globalization, interwar delinkage, and globalization/hyperglobalization after World War II. It is well-grounded in the economic literature and considers trade, capital and immigration flows. It is also readable but with no particular attempt at a unique or original thesis. It’s generally pro-globalization with some nuance and downsides—but ultimately it argues, “globalization is nothing more than the urge to trade and improve the quality of life. These goals are a significant part of our shared humanity. In this view, globalization over the long run has been rising and will continue to rise in the future.” First, I should say there is much more hostility to trade in the United States than in many other countries. Research shows there are two reasons for that. First, trade is much less important to the United States than it is to other countries. Most people are employed in jobs that are not producing exports and most of what we buy actually is made in America. That’s a stark contrast from a country like Sweden where workers realize they would not have jobs without exports and consumers understand Sweden cannot produce everything they need. A second factor matters too which is that Sweden, and other countries, have stronger social safety nets than the United States so people are better protected from the downsides of trade. That said, there is no doubt that there is at least some hostility to trade everywhere. Part of the issue is that there are some people that can be very hurt by trade, for example workers competing with foreign producers, while the benefits of trade are collectively larger but more diffuse. The beneficiaries do not realize the ways in which they benefit and absent a strong personal incentive can fall prey to false zero-sum arguments that treat trade and technology asymmetrically even if technology has actually had bigger impacts on jobs. Finally, some of the recent hostility to trade does reflect a reasonable national security concern about the incredible concentration of certain forms of production in China , a country that is a geopolitical rival to the United States and Europe. All of that said, the benefits of globalization are so large that I believe it is more like a dandelion that can thrive in any conditions than an orchid that needs to be carefully nurtured. There are bumps in the road but we will always have a lot of it."