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A Better Globalization

Globalization has given rise to legitimate frustrations and concerns, which can’t be assuaged simply by recalling the enormous benefits it has brought. But, rather than trying to roll back globalization, we have no choice but to try to make it work better.

MADRID – The COVID-19 pandemic has prompted much reflection on the state of globalization, its drawbacks at a time of worldwide disruption, and the supposed benefits of retreating to the national sphere. In this sense, as in many others, the current crisis has accelerated pre-existing tendencies. The global trade-to-GDP ratio – one of the main indicators of globalization – has followed a downward trend since 2012, and anti-globalist political movements have been gaining in popularity for some time.

These movements have good reasons to mistrust globalization, and even more so now. The scarcity of vital materials – from face masks to yeast – highlighted the low resilience of the global supply chains that produce so much of what we use, owing to their excessive concentration in a few countries and the lack of essential stockpiles. Moreover, globalization has created many losers within individual countries, especially in the developed world.

This phenomenon has been particularly marked in the United States, where the average income of the poorest 50% actually fell between 1980 and 2010. The delocalization of production is certainly not the only reason (the effects of automation on inequality are often overlooked), but it is a significant one.

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