Tuesday , March 28 2017
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Dani Rodrik’s weblog

Ariel Rubinstein on Economics Rules

The great Ariel Rubinstein has a review of my book Economics Rules in the latest issue of the Journal of Economic Literature. It is a fun review – gratifying for me because Ariel agrees with many of my arguments – and it has a deeply personal, even emotional, feel to it. Ariel feels strongly about the turn the profession has taken, and agree or not, the essay makes for a very interesting read. The review took me back to my graduate-student days at Princeton. The place had a very strong...

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A Foreword to Kari Polanyi Levitt

I was recently asked to write a foreword to the Mexican edition of Kari Polanyi Levitt’s From the Great Transformation to the Great Financialization. Kari is Karl Polanyi's daughter, and the essays in her book -- part memoir, part intellectual history, part analysis of the global economy -- provide a wonderful Polanyi-esque perspective on our day. I happily accepted, and my Foreword is below. **** I first encountered Karl Polanyi as an undergraduate, in a course on comparative politics....

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Thinking straight about fair trade

In the previous entry, I discussed the real-world distributional effects of trade agreements, in the specific case of NAFTA. Why should we care about such redistribution and how should we deal with it? It is useful to distinguish between two different versions of an argument as to why trade may be problematic from a social or political perspective. Trade is problematic because it redistributes income. Trade is problematic because it violates norms and understandings embodied in our...

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What did NAFTA really do?

Brad De Long has written a lengthy essay that defends NAFTA (and other trade deals) from the charge that they are responsible for the loss of manufacturing jobs in the U.S. I agree with much that he says – in particular with the points that the decline in manufacturing employment has been a long-term process that predates NAFTA and the China shock and that it is driven mainly by the secular trend of labor-saving technological progress. There is no way you can hold NAFTA responsible for...

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New results on structural change during the recent growth boom in developing countries

The last two decades have been a rare period of rapid convergence for the world's developing economies. Everyone is familiar with China and India's experience, but growth went beyond these two large economies. Many countries in Sub-Saharan Africa and Latin America had their best performance in decades, if not ever. In a new paper, my co-authors Xinshen Diao (IFPRI) and Margaret McMillan (Tufts and IFPRI) and I examine this experience. We ask what drove this growth and how sustainable is...

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Is Global Equality the Enemy of National Equality?

The question in the title is perhaps the most important question we confront, and will continue to confront in the years ahead. I discuss my take in this paper. Many economists tend to be global-egalitarians and believe borders have little significance in evaluations of justice and equity. From this perspective, policies must focus on enhancing income opportunities for the global poor. Political systems, however, are organized around nation states, and create a bias towards...

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Scholars’ letter of support for Ricardo Hausmann

Here is a letter that I have prepared and signed with some colleagues in response to Venezuelan president Nicolás Maduro’s ugly attacks on Ricardo Hausmann. “We the undersigned write to express our dismay at Venezuelan president Nicolás Maduro’s repeated targeting of our colleague Ricardo Hausmann and to express our support for Professor Hausmann. Two years ago, President Maduro ordered Venezuela’s Attorney General to proceed against Professor Hausmann following an article in...

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The Walloon mouse

It appears Belgium's Wallonia has put a nail on the coffin of the EU-Canada trade agreement (CETA) by vetoing it. The reasons, The Economist puts it, "are hard to understand."  Well, yes and no. Canada is one of the most progressive trade partners you could hope to have, and it is hard to believe that Walloon incomes or values are really being threatened. But clearly something larger than the specifics of this agreement is at stake here. Instead of decrying people's stupidity and...

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How to tell apart trade agreements that undermine democratic principles from those that don’t

I discussed in an earlier post on Brexit how to think about international agreements and the constraints on state action they entail in terms of democratic legitimacy. Since that discussion has relevance beyond Brexit, I've pasted the relevant part here below. The basic point is this: the fact that an international rule is negotiated and accepted by a democratically elected government does not inherently make that rule democratically legitimate. The optimistic argument has been best...

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It’s a war of ideas, not of interests

Mike Konczal has an interesting piece on how the progressives are unlikely to win over Trump’s base of white, male, working class voters – even if they take their concerns to heart and propose policies that will help them.  He thinks progressives lack specificity and clarity on the “specific approaches and programs [that] would convince Trump’s voters to join liberals.” More fatally, he believes the progressive agenda, if successfully implemented, would actually fail to bring these voters...

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