Guest Contribution: “A Resilience Case for International Trade”

Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy  School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared at Project Syndicate.

Some new problems have afflicted the economy in the last year.  Two examples come from the US:  blockages in supply chain logistics and a critical shortage in infant milk formula. One problem applies to the EU even more than to the US: energy scarcity due to sanctions against Russian fossil fuel exports.  And one now applies almost everywhere: inflation.

Some have associated these four problems with what is said to be excessive dependence on international trade, that is, with globalization.  Deglobalization, fragmentation, reshoring, friend-shoring, decoupling, and resilience have become familiar buzzwords.  The feeling is that individual countries would not have been so exposed to shocks if they had been more self-sufficient.

The argument goes

Keep reading this article on Econbrowser Blog - James Hamilton & Menzie Chinn.

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