A sobering piece by Dani Rodrik on a "better globalization" replacing the era of hyper globalization is here in this Project Syndicate piece.
He argues that the answer to the retreat to hyper-globalisation need not be autarky but a more equitable, distributive globalization that takes care of the losers of globalization.
"Yet, it is also possible to envisage a good scenario whereby we achieve a better balance between the prerogatives of the nation-state and the requirements of an open economy. Such a rebalancing might enable inclusive prosperity at home and peace and security abroad.
The first step is for policymakers to mend the damage done to economies and societies by hyper-globalization, along with other market-first policies. This will require reviving the spirit of the Bretton Woods era, when the global economy served domestic economic and social goals – full employment, prosperity, and equity – rather than the other way around. Under hyper-globalization, policymakers inverted this logic, with the global economy becoming the end and domestic society the means. International integration then led to domestic disintegration."
He also alludes to the importance of a multipolar world instead and new rule makers. Graham Allison has talked about the Thucydides Trap when a rising power threatens to displace a ruling power, war is inevitable. Dani Rodrik opines:
For great powers, and the US in particular, this means acknowledging multipolarity and abandoning the quest for global supremacy. The US tends to regard American predominance in global affairs as the natural state of affairs. In this view, China’s economic and technological advances are inherently and self-evidently a threat, and the bilateral relationship is reduced to a zero-sum game.
How globalization will play out in terms of international economic law rule making will depend on what approaches to trade major economies would take in the coming decade? Would it based more in the region rather than global? Would there be different trading blocs? Would domestic concerns and priorities shape trade policy leading to tensions at the WTO? Would trade increase but trade rules stagnate?
I had the privilege of moderating a session recently with Prof.Dani Rodrik on avoiding one-size fits-all solutions. the video recording is here. We find some answers here.
