Globalization was oversold. Politicians and some economists wrongly argued for trade agreements on the basis of job creation. The gains to GDP or growth were overestimated, and the costs, including adverse distributional effects, were underestimated. There have been important political consequences of this overselling, including the undermining of confidence in the elites that advocated globalization.
The failures of globalization and the misguided backlash against it contain many lessons: about the importance of science and learning in society, the importance of the shared acceptance of facts, the dangerous consequences of deliberately misinforming the public, and the folly of ignoring the distributional consequences of economic forces just because they may lead to growth. The new protectionism advocated by the administration of Donald Trump will only worsen the plight of those already hurt by globalization. What is needed is a comprehensive system of social protection. After cataloging the failures of globalization and explaining how they led to our current political mire, “The Overselling of Globalization” outlines a set of policies that could put the economy and our politics back on a better path.
Author
Joseph Stiglitz
Chief Economist and Senior FellowAs chief economist and senior fellow at the Roosevelt Institute, Joseph Stiglitz focuses on income distribution, risk, corporate governance, public policy, macroeconomics, and globalization.