412 READINGS Flashcards
Political Economy of Trade Policy Cornick et al -Summary
This chapter discusses the political economy of trade policy, highlighting the BALANCE between the benefits of trade liberalization for overall welfare and the concentrated losses experienced by specific groups. It emphasizes how trade policy is shaped by the interests of BOTH public and private actors, often creating a COMPLEx landscape of support and opposition influenced by economic and political stakes.
Political Economy of Trade Policy Cornick et al - Argument
The authors argue that the durability of trade liberalization depends on CREATING COALITION a broad coalition of winners, while understanding and ADDRESSING CONCENTRATION the concentrated costs for import-competing firms and workers who may resist such policies.
Political Economy of Trade Policy Cornick et al - Conclusion
The chapter concludes that trade policy persistence relies on institutional frameworks and strategic compensation, which can create a stable coalition favoring open markets and trade agreements.
Political Economy of Trade Policy Cornick et al -Math/Evidence
Evidence includes case studies of countries like Chile, Costa Rica, and Brazil, illustrating different approaches to trade liberalization, varying from gradual reductions to protectionist reversals and compensation mechanisms for affected sectors.
Political Economy of Trade Policy Cornick et al -Significance
This chapter is significant because it highlights the critical role of political and economic institutions in shaping trade policy, showing how trade liberalization’s success hinges on managing diverse interests and sustaining economic benefits through stability and strategic adaptation.
Political Economy of Trade Policy Cornick et al - Trade Policy - Interest Group Dynamics
Trade policy often involves high-stakes lobbying from sectors like import-competing firms, exporters, and consumer interest groups, although consumer influence tends to be weak and diffuse.
Political Economy of Trade Policy Cornick et al -Compensation Strategies in Trade Liberalization
Chile example
Chile compensated farmers during Mercosur negotiations to support agriculture, providing public goods like soil management that promoted exports and created a coalition supporting open trade. provided export promotion funds to farmers along with credit guarantees and infrastructure investments
Political Economy of Trade Policy Cornick et al - Case Study - Costa Rica and CAFTA-DR
The CAFTA-DR referendum in Costa Rica revealed strong public division over trade, with the narrow victory of pro-trade forces leading to nearly irreversible trade policy changes despite continued opposition.
Political Economy of Trade Policy Cornick et al -Brazil’s Protectionist Tendencies
Brazil’s industrial sector has historically dominated trade policymaking, resulting in high tariffs and frequent use of anti-dumping measures, supported by an institutional structure favoring protectionism.
Political Economy of Trade Policy Cornick et al -U.S. Trade Policy and the Executive Role
In the U.S., delegation to the executive branch with delegation to president helps individual congresspplTrade Promotion Authority has generally promoted liberalization, although recent trends show volatility influenced by protectionist sentiments in swing states. this could change
Morgan - The Firm - Summary
Morgan examines multinational firms as political actors within the global economy, focusing on their use of lobbying, structural power, and expertise to influence states and international organizations. The chapter categorizes firms by ownership and governance (e.g., shareholder-driven, state-permeated) and by sector, examining how these characteristics shape their strategies for influencing regulatory and market structures worldwide.
Morgan - The Firm - Argument
Morgan argues that multinational firms exert significant influence on international political economy through lobbying, leveraging structural power, and asserting expertise, often aligning their activities with state policies or challenging regulations to enhance their interests.
Morgan - The Firm - Conclusion
The chapter concludes that understanding the international political economy requires recognizing firms’ strategic use of power, shaped by their governance structures and sectoral needs, in influencing state and global regulatory landscapes.
Morgan - The Firm - Math/Evidence
Evidence includes case studies of various multinational firms, categorized by ownership (e.g., state-owned, private equity) and sector, such as technology firms influencing internet regulation and energy firms shaping environmental policy.
Morgan - The Firm - Significance
This analysis is significant as it highlights how multinational firms operate beyond traditional market competition, acting as political entities that shape global governance and economic regimes, often aligning with or pressuring state interests to their advantage.
Morgan - The Firm - Types of Firms - Shareholder-driven vs. Stakeholder-driven
Shareholder-driven firms (e.g., in the US, UK) focus on short-term shareholder returns, while stakeholder-driven firms (e.g., in Germany, Denmark) balance multiple interests, including labor and local government, affecting their approach to regulatory influence.
Morgan - The Firm - State-permeated Firms
Firms with strong state connections (e.g., Chinese and Brazilian firms) use state resources and diplomatic channels to support international expansion, often aligning closely with home-country policy objectives.
Morgan - The Firm - Sector-Specific Influence - Financial MNCs
Financial multinationals (e.g., banks, hedge funds) exert influence by controlling capital flows, creating systemic risks that can impact national policies, as seen in responses to financial crises.
Morgan - The Firm - Platform Companies - FAANGs
Firms like Facebook and Google leverage near-monopoly positions and lobbying to maintain a deregulated internet, facing limited constraints from national governments due to consumer dependence on their services.
Morgan - The Firm - Structural Power of Capital
Multinational firms leverage capital mobility, relocating to favorable environments, which pressures governments to maintain competitive labor and regulatory standards, contributing to a “race to the bottom.”
Blood in the Water - Summary
This article examines Carlsberg’s struggle to retain control of its Russian subsidiary Baltika, which was placed under “temporary management” by the Kremlin in response to Western sanctions. The seizure marks a trend of asset expropriation where the Russian government rewards loyalists with assets previously owned by foreign companies, leaving Carlsberg with nominal ownership but no operational control over its second-largest market.
Blood in the Water - Argument
The article argues that Carlsberg’s experience reflects a broader trend of Russian state interventions in foreign-owned businesses, which increasingly restrict Western companies’ abilities to operate in Russia as the government seizes assets to reward loyalists.
Blood in the Water - Conclusion
Carlsberg’s loss of Baltika exemplifies the risks Western firms face in Russia, as geopolitical tensions drive state actions that undermine business ownership, often with little warning or recourse.
Blood in the Water - Math/Evidence
Evidence includes Carlsberg’s financial data showing that Baltika once generated over 10% of the group’s global revenue, with Russia constituting a significant portion of sales until recent sanctions and state actions.
Blood in the Water - Significance
This case is significant as it highlights the growing instability of foreign investments in Russia, where assets may be seized with minimal compensation, reflecting the impact of geopolitical shifts on business operations.
Blood in the water - Carlsberg’s Initial Investment in Baltika
Carlsberg took full control of Baltika in 2008 when Russia made up 40% of its profits; however, regulatory changes and competition gradually eroded market share.
Blood in the water - Temporary Management vs. Nationalization
Russian authorities placed Baltika under “temporary management,” not full nationalization, leaving Carlsberg with ownership but no decision-making power, illustrating a tactic to keep assets in limbo as potential bargaining tools.
Blood in the water - Challenges in Finding Local Buyers
Carlsberg’s attempt to sell Baltika to Russian manufacturer Arnest fell through unexpectedly, illustrating the challenges Western companies face in securing viable exit strategies from the Russian market.
Blood in the water - Impact of Russian Protectionism
The new Russian management is promoting Baltika as a patriotic brand, using slogans like “free from foreign additives” and plans to produce beer using only Russian hops, reflecting a shift toward economic nationalism.
Blood in the water - Western Corporate Caution
Carlsberg’s experience has heightened caution among Western firms in Russia, where companies now view political connections and the speed of exit deals as critical to minimizing expropriation risks.
U.S. Investors Could Bankrupt Honduras - Summary
This article discusses the controversy surrounding Honduras’s ZEDEs (Zones for Employment and Economic Development), autonomous regions where U.S. investors, like Próspera, are suing the Honduran government for $10.8 billion due to policy changes under President Xiomara Castro. With international backing, these investors are using investor-state dispute mechanisms (ISDS) that could destabilize Honduras’s economy by leveraging claims of lost future profits.
U.S. Investors Could Bankrupt Honduras - Argument
The authors argue that investor-state arbitration, such as Próspera’s case, poses a severe threat to Honduras’s sovereignty, undermining local governance and risking national bankruptcy due to aggressive corporate claims enabled by international trade agreements.
U.S. Investors Could Bankrupt Honduras - Conclusion
The article concludes that the Biden administration should support Honduras’s democratic sovereignty rather than back corporate lawsuits that contradict stated U.S. objectives of fostering stability in Central America.
U.S. Investors Could Bankrupt Honduras - Significance
This case is significant as it illustrates the power dynamics between investors and developing states, highlighting the risks of ISDS clauses in trade agreements that can challenge national policies and threaten economic stability.
U.S. Investors Could Bankrupt Honduras - ZEDEs Background
ZEDEs were created to attract foreign investment by granting private corporations autonomy over laws, taxes, and policing, but critics argue they erode sovereignty and foster corruption.
U.S. Investors Could Bankrupt Honduras - Investor-State Dispute Settlement (ISDS) Mechanisms
ISDS mechanisms allow corporations to sue governments over policy changes, claiming compensation for lost profits, often favoring investors over state interests.
U.S. Investors Could Bankrupt Honduras - U.S. Government’s Mixed Stance
Despite Biden’s criticism of ISDS, the U.S. State Department has shown support for the ZEDEs, citing CAFTA-DR protections, reflecting conflicting interests in Central America.
U.S. Investors Could Bankrupt Honduras - Potential Consequences of Arbitration
If Próspera wins the case, Honduras would be liable for damages that could lead to national bankruptcy, making the ZEDE conflict a high-stakes example of the impact of ISDS.
What is expropriation?
Expropriation is the act of a government seizing private assets, typically with some form of compensation, though sometimes minimal or symbolic. Expropriation can target foreign or domestic companies and is often justified by the state on grounds of national interest, sovereignty, or economic security.
Honduras vs. Russia Case - Similarities
- Government Intervention Against Foreign Companies: Both governments (Honduras and Russia) acted to transfer control from foreign investors to local interests. 2. Geopolitical Tensions and Sovereignty: Each expropriation occurred as authorities sought to assert sovereignty over foreign businesses amidst policy shifts. 3. Use of ** Legal ** Mechanisms: Honduras faced investor arbitration under CAFTA-DR; Russia used “temporary management.”
Honduras vs. Russia Case - Differences
- Direct Seizure vs. Legal Disputes: Russia directly took administrative control, while Honduras faces legal disputes and arbitration claims. 2. Motivation and Context: Russia’s actions reflect sanctions-related tensions and loyalty rewards, while Honduras’s case responds to internal demands for sovereignty. 3. Financial Impact: Próspera’s $10.8 billion claim risks destabilizing Honduras; Carlsberg’s Baltika loss impacts Carlsberg without destabilizing Russia.
BB6 Value Chains -Summary
This brief explains the value chain framework, describing how products pass through stages of value-adding activities. The document examines vertical integration, the trend toward specialization and outsourcing, and the development of global production networks (GPNs) as companies seek competitive advantage by locating stages in countries with cost efficiencies.
BB6 Value Chains -Argument
The authors argue that companies increasingly specialize in stages of the value chain where they hold a competitive advantage, with vertical dis-integration and GPNs allowing firms to focus resources efficiently while leveraging international cost advantages.
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BB6 Value Chains - Math/Evidence
Examples include the computer industry’s shift from IBM’s vertical integration to today’s specialization across firms like Intel, Dell, and Microsoft, with stages of production outsourced to countries with comparative advantages in labor and technology.
BB6 Value Chains -Significance
The value chain framework is significant for its impact on corporate strategy, with companies optimizing by outsourcing or offshoring stages, which shapes global trade patterns and economic integration.
BB6 Value Chains -Vertical Integration vs. Vertical Dis-Integration
Vertical integration keeps stages within a single firm, while vertical dis-integration involves outsourcing stages to other firms, a trend driven by globalization and specialization.
BB6 Value Chains - Global Production Networks (GPNs)
GPNs involve locating stages of the value chain across different countries based on comparative advantage, such as labor-intensive stages in low-wage countries.
BB6 Value Chains - Outsourcing vs. Offshoring
Outsourcing refers to moving activities outside the company, while offshoring means relocating them internationally; both decisions are often made to reduce costs or access specialized skills.
BB6 Value Chains - Business Strategy and the Make-Buy Decision
Companies use value chain analysis to determine which activities to perform in-house versus purchase externally, focusing on areas where they have a sustainable advantage.
BB6 Value Chains - Modularity and Technological Progress
Industries like computing benefit from MODULAR VALUE CHAINS value chains, where standardized interfaces allow innovation at different stages, such as the USB enabling various device connections.
Foxconn and Sharp - Summary
The article explores Foxconn’s $3.5 billion acquisition of a controlling stake in Sharp, a Japanese screen maker, as part of Foxconn’s strategy to strengthen ties with Apple and expand its control over the supply chain. The deal reflects Foxconn’s response to RISING CHINESE LABOR COSTS REACTION rising Chinese labor costs and increasing competition, as the company aims to remain competitive by diversifying AIM TO DIVERSIFY into high-tech manufacturing. BUT MAY NOT BE PROFITABLE
Foxconn and Sharp - Argument
Mozur argues that Foxconn’s acquisition of Sharp represents a REPRESENTS A STRATEGIC SHIFT SEEKS CLIMB CHAIN strategic shift as the company seeks to climb the value chain, aiming to control more of its supply chain and maintain its role as a MAINTAIN ROLE AS KEY APPLE SUPPLIER key Apple supplier amid rising labor costs and slowing smartphone demand.
Foxconn and Sharp - Conclusion
The article concludes that Foxconn’s success with Sharp will DEPENDS ON RESTRUCTURING depend on substantial restructuring efforts, given Sharp’s financial struggles and high operating costs, challenging Foxconn’s vision of an integrated supply chain.
Foxconn and Sharp - Math/Evidence
Evidence includes the $3.5 billion investment and Sharp’s 25% share in iPhone screens, along with insights into Sharp’s $3 billion potential liabilities and Foxconn’s previous acquisition experiences, highlighting the risks involved.
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Foxconn and Sharp - Rising Labor Costs in China
Foxconn faces pressures from rising labor costs in China, prompting investments in automation and higher-value sectors like screen production to offset costs.
Foxconn and Sharp - Importance of Sharp in Apple’s Supply Chain
Sharp supplies about 25% of the iPhone displays, making it a critical part of Apple’s supply chain and a strategic acquisition for Foxconn to secure Apple’s business.
Foxconn and Sharp MOZUR- Financial Risks with Sharp
Sharp’s financial difficulties include $3 billion in potential liabilities, posing integration challenges for Foxconn as it manages the turnaround.
Foxconn and Sharp - Foxconn’s History of Acquisitions
Past acquisitions, like Chimei Innolux, have not met profitability expectations, raising concerns about Foxconn’s ability to manage Sharp’s integration successfully.
Foxconn and Sharp - Automation as a Long-term Strategy
Foxconn has invested in automation, seeking to reduce dependence on low-cost labor by transitioning into sectors that rely on advanced manufacturing technologies.
Economics and Emigration Clemens Trillions - Summary
Clemens explores the economic impact of barriers to emigration from poorer to richer countries, arguing these restrictions impose massive economic costs. He suggests that reducing these barriers would yield benefits far exceeding those from removing remaining trade and capital flow restrictions.
Economics and Emigration Clemens Trillions - Argument
Clemens argues that migration barriers create significant distortions in the global economy, far larger than trade or capital barriers, and advocates for prioritizing research and policies that facilitate labor mobility.
Economics and Emigration Clemens Trillions - Conclusion
Clemens concludes that a new research agenda on migration is necessary, with a focus on the unrealized economic potential of reduced migration restrictions.
Economics and Emigration Clemens Trillions - Math/Evidence
Clemens references studies estimating that reducing migration barriers could increase global GDP by 50–150%, vastly outweighing the gains from liberalizing trade or capital flows.
Economics and Emigration Clemens Trillions - Significance
The paper underscores migration’s potential as a high-impact economic tool, challenging CHALLENGING CONVENTION economists to treat emigration restrictions as critical barriers to global economic efficiency.
Economics and Emigration Clemens Trillions - Migration’s Global Economic Impact
Estimates suggest that reducing migration barriers could lead to global economic gains of 50-150% of world GDP.
Economics and Emigration Clemens Trillions - Comparative Losses from Trade vs. Migration Restrictions
Clemens shows that while trade restrictions might cost the global economy a few percent of GDP, migration restrictions impose far larger losses.
Economics and Emigration Clemens Trillions - Labor Productivity and Migration
Clemens notes that location significantly affects productivity; many workers become far more productive simply by moving from low-income to high-income countries.
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Economics and Emigration Clemens Trillions - Research Agenda on Migration
Clemens proposes a research focus on migration’s broader impacts, arguing for policy-oriented studies on labor demand, productivity, and external effects of skilled emigration.
Mediterranean the New Rio Grande? - Summary
This paper analyzes long-term migration trends, comparing pressures on the U.S. and Europe, as demographic shifts alter migration dynamics. While Latin American migration to the U.S. is projected to slow due to lower population growth, Europe is likely to face sustained immigration pressure from Africa and the Middle East as their working-age populations grow.
Mediterranean the New Rio Grande? - Argument
Hanson and McIntosh argue that demographic forces will shape future migration, with Europe experiencing increasing migration pressures due to population growth in neighboring regions, contrasting with the U.S. where migration pressures from Latin America are expected to stabilize.
Mediterranean the New Rio Grande? - Conclusion
The paper concludes that demographic trends will demand different migration policies for the U.S. and Europe, with Europe needing robust immigration strategies to handle sustained inflows from Africa and the Middle East.
Mediterranean the New Rio Grande? - Math/Evidence
The authors use a gravity model to project migration, finding that Europe’s immigrant stock could nearly triple by mid-century, driven by demographic growth in Sub-Saharan Africa, which will see an 800 million increase in working-age population by 2050.
Mediterranean the New Rio Grande? - Significance
This study is significant as it underscores the need for Europe to adapt to inevitable migration pressures, presenting demographic forces as a persistent driver that will reshape immigration policies.
Mediterranean the New Rio Grande? - Population Growth Differentials
The study highlights that slowing population growth in Latin America contrasts with sustained growth in Africa and the Middle East, affecting U.S. and EU migration differently.
Mediterranean the New Rio Grande? - Projected Migration in Europe
Europe’s immigrant stocks are expected to nearly triple, while U.S. migration from Latin America is predicted to level off.
Mediterranean the New Rio Grande? - Role of Gravity Model in Projections
The authors use a gravity model based on past population growth to estimate future migration trends, illustrating how demographic changes will impact bilateral flows.
Mediterranean the New Rio Grande? - Migration Neighborhood Concept
The authors introduce the “migration neighborhood” concept, where population dynamics in nearby regions like North Africa and the Middle East create lasting migration pressure on Europe.
Mediterranean the New Rio Grande? - Policy Implications for EU vs. U.S.
While the U.S. may focus on enforcement to manage reduced migration from Latin America, Europe may need integrated policies to accommodate sustained inflows from its neighboring regions.
Robertson, Effects of Regulating Trade - Summary
Robertson examines the impacts of trade regulation on firms and workers, highlighting how trade liberalization generally increases national welfare but often imposes significant adjustment costs on workers, which can lead to localized economic hardships. While regulating trade may address some immediate issues, Robertson argues that targeted policies to reduce worker adjustment costs would more effectively address these challenges.
Robertson, Effects of Regulating Trade - Argument
The core argument is that although trade liberalization benefits overall welfare, it creates concentrated adjustment costs for certain worker groups, making policies to reduce these adjustment costs a preferable alternative to trade regulation.
Robertson, Effects of Regulating Trade - Conclusion
Robertson concludes that reducing adjustment costs through targeted policies, rather than restricting trade, would more effectively sustain trade benefits while minimizing localized economic disruptions.
Robertson, Effects of Regulating Trade - Math/Evidence
Evidence includes studies showing that worker adjustment costs are particularly high in both developed and developing countries, with costs reaching several times the annual earnings in regions like Sub-Saharan Africa and East Asia.
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Robertson, Adjustment Costs - Types
Worker adjustment costs include costs of job search, retraining, mobility, and loss of specific skills. Firm adjustment costs involve hiring and training expenses, which vary by region and impact trade-related labor shifts.
Robertson, Localized Effects of Trade Liberalization
Studies show that import competition causes job losses and wage declines in specific areas, while regions specializing in exports tend to benefit, leading to significant regional inequalities.
Robertson, Worker Mobility and Relocation Costs
High relocation and mobility costs, especially in developed countries, mean that displaced workers often do not move, resulting in prolonged local unemployment and slow adjustment.
Robertson, Alternative to Trade Regulation - Direct Subsidies
Direct subsidies for moving costs or retraining can reduce adjustment costs significantly, making trade’s net benefits more widely accessible and mitigating opposition to free trade policies.
Robertson, Empirical Data - Developing Countries
Brazil’s experience with trade liberalization in the 1990s showed prolonged job displacement effects, with median worker mobility costs estimated at 1.4 to 2.7 times annual wages, underscoring the need for supportive policies.
The Dollar at the Center of the World - Summary
This podcast explores the historical moment at Bretton Woods where the U.S. dollar was established as the global economic standard, anchored in the rivalry between economist John Maynard Keynes and U.S. Treasury official Harry Dexter White. Their intense negotiations led to a new financial order where the U.S. dollar replaced gold as the international currency standard, defining global trade for decades.
The Dollar at the Center of the World - Argument
The podcast argues that the U.S. used the Bretton Woods Conference and White’s influence to secure the dollar’s central role in the post-war economy, establishing an enduring foundation for American economic power. THIS EVENT MADE AN ENDURING FOUNDATION FOR AMERICAN ECONOMIC POWER
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The Dollar at the Center of the World - Significance
This event was significant as it marked the rise of the U.S. dollar as the global economic anchor, replacing gold and giving the U.S. a strategic position in international economics, a status that remains influential today.
Middle-Income Trap - Summary
This brief explores the concept of the middle-income trap, questioning whether it truly exists or is a reflection of broader anxieties over slow economic growth. The authors argue that while growth often slows for middle-income countries, success depends on productivity improvements and adapting growth strategies rather than escaping a so-called ‘trap.’
Middle-Income Trap - Argument
The authors argue that while the middle-income trap may be more of a myth than a reality, it serves as a useful framework to encourage policymakers to reassess economic strategies and prioritize productivity improvements as countries reach middle-income levels.
Middle-Income Trap - Conclusion
The brief concludes that reaching high-income status is challenging but achievable if countries focus on sustainable policies and structural reforms that enhance productivity, emphasizing that economic growth requires different approaches at different stages.
Middle-Income Trap - Math/Evidence
Evidence includes data showing that only 13 out of 101 middle-income countries in 1960 reached high-income status by 2008, while growth slowdowns are common around specific per capita income levels (e.g., $10,000-$15,000 in PPP terms), suggesting the need for diversified growth strategies.
Middle-Income Trap - Significance
The discussion of the middle-income trap is significant because it highlights that middle-income countries face unique growth challenges, emphasizing the importance of policy adaptation and innovation to sustain economic progress.
Middle-Income Trap - Definition and Origin
The term ‘middle-income trap’ was popularized by Gill and Kharas to describe slower growth at middle-income levels due to shifts from cheap labor and basic technology to competition with both low-wage and high-tech economies.
Middle-Income Trap - Empirical Data
Latin America and the Middle East provide empirical cases, with many economies remaining at middle-income levels for decades, illustrating the trap’s possible existence or the effects of economic stagnation.
Middle-Income Trap - Growth Slowdown Thresholds
Studies identify growth slowdowns as particularly common at income levels of around $10,000 and $15,000 per capita (PPP-adjusted), indicating that middle-income countries may require targeted policies to overcome these barriers.
Middle-Income Trap - Policy Recommendations
Effective policies for middle-income countries include investing in human capital, promoting R&D, managing inflation, and supporting high-tech exports, all of which contribute to productivity improvements.
Middle-Income Trap - Counterpoint - Myth of the Trap
Some studies challenge the middle-income trap concept, finding that growth is steady for most countries and that the transition to high-income status depends more on stable, long-term growth strategies than on escaping a trap.
Middle-Income Trap - Basic Logic
The basic logic of the middle-income trap is that countries initially experience rapid growth due to cheap labor, basic technology, and labor reallocation from low- to high-productivity sectors. As wages rise and these growth drivers weaken, middle-income countries struggle to compete with low-wage economies and high-tech, high-income countries. Without new strategies focused on productivity, innovation, and competitiveness, they risk stagnation at middle-income levels, unable to advance further.
Middle-Income Trap - Examples of Countries That Escaped
Examples of countries that have successfully transitioned from middle-income to high-income status, escaping the middle-income trap, include South Korea, Taiwan, Singapore, Hong Kong, Ireland, Israel, Japan, Spain, and Portugal. These countries achieved this by adopting policies that promoted productivity, innovation, economic diversification, and stable macroeconomic conditions.
Goldberg & Reed - Summary
The paper by Goldberg and Reed examines whether the global economy is experiencing deglobalization, driven by shifts in trade policies and geopolitical tensions. Despite some slowing in trade post-2008, globalization remains resilient, with ongoing changes in policies, especially by the U.S., potentially marking a new era.
Goldberg & Reed - Argument
The authors argue that recent geopolitical events and NOT JUST ECONOMICS BUT POLICY policy shifts—rather than economic forces alone—are prompting countries to reconsider global trade dependencies, signaling a possible shift toward selective globalization or ‘friendshoring.’
Goldberg & Reed - Conclusion
The paper concludes that while traditional globalization metrics show resilience, policy and sentiment shifts, particularly in the U.S., indicate a nuanced trend that could reshape global trade dynamics in unpredictable ways.
Goldberg & Reed - Math/Evidence
The authors support their argument by analyzing global trade data post-2008, observing fluctuations due to COVID-19, and comparing these with policy trends such as tariffs and export restrictions.
Goldberg & Reed - Significance
This paper is significant as it suggests that the future of globalization may be increasingly shaped by political and security considerations rather than purely economic ones, potentially leading to fragmented global markets.
Goldberg & Reed - Global Trade and GDP Trends
The authors note that, while world trade has grown over the past few decades, it has slowed relative to global GDP since the financial crisis. This slowing trade-to-GDP ratio, called ‘slowbalization,’ hints at a reduced pace of globalization rather than a full reversal.
Goldberg & Reed - Policy and Geopolitical Shifts
Three phases show geopolitical and policy pressures: (1) Mid-2010s with labor market impacts and protectionism; (2) COVID-19 raised reshoring concerns despite trade resilience; (3) Post-2022, national security concerns led to ‘friendshoring’ and U.S. export restrictions targeting nations like China.
Goldberg & Reed - Import and Export Data INDIA CHINA GERMANY
The paper examines shifts in import reliance, showing how countries like China and India now produce more inputs domestically, reducing global dependence. Other economies, such as Germany, remain deeply integrated globally, illustrating diverse global responses to globalization.
Goldberg & Reed - Public and Political Sentiment Analysis
By analyzing changing terms like ‘resilience’ and ‘national security’ in news, the authors show increased public skepticism and political shift against certain globalization aspects, especially post-COVID-19 and during the Trump administration.
Planet money makes a t shirt Bangladesh vs Columbia
In Columbia it’s just a job in Bangladesh this has changed the industries substantially
