Thursday, August 25, 2005

Neglected economics posts at Through The Looking Glass

These are old articles, but I just read them recently, and I think they deserve more attention. Charles Dodgson has a number of articles about the economics of globalization:

  1. Why isn't the "oil curse" just comparative advantage at work? This article suggests that the economic theory of "comparative advantage" might explain why countries with oil resources (Nigeria, for example) will fail to develop other industries. (the "oil curse")

  2. If a country's comparative advantage is in dirt farming, how can it still industrialize under unrestricted free trade?

  3. Innovation in England in the 1950s created jobs somewhere else. What makes innovation here and now different? One argument in favor of globalization is that while some jobs may be outsourced, the good jobs (high-paying, innovative, creative) will still be around for Americans. Charles points out that this is wishful thinking (ignoring history) and/or chauvinism (to believe that only Americans can do the creative stuff).

  4. Why do trade treaty regulatory bodies have the right to review environmental policy, but not monetary policy?

Like Charles, I am skeptical of the claims that globalization and lifting of all trade barriers will make everyone better off through the miracle of the marketplace.


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