Greenspan on Seattle

christian a. gregory chrisgregory11 at
Tue Jan 18 10:21:27 PST 2000

Rakesh wrote:

> To the extent that international trade has grown as a percentage of
global > world product (GWP), it is probably due to a slow down in the rate of > growth of GWP rather than an accelerating growth in international trade > itself. Paolo Giusanni notes; "The fastest growth in both Gross World > Product and International Trade (IT) occurred during the so called 'golden > age of capitalist development' (1950-73), which appears as a rather > outstanding performance (the expansion in world market was 2.8 times higher > than during the 1973-1990 period). By contrast, the relatively fast growth > in world trade share of GWP over the last 25 years was mainly the result of > a stagnating GWP, and not that of accelerating IT. IT only seems to grow > rapidly because the GWP is exhibiting the lowest rate of growth over the > last 150 years, excluding the greatly disturbed period of 1913-1950." From > the International Journal of Political Economy (I have a prepublication > draft form, so don't have vol, no., month/date, pp).

David Felix makes another interesting version of this argument in "Asia and the Crisis of Financial Globalization," an essay in Baker, Epstein, and Pollin's _Globalization and Progressive Economic Policy_. He argues that the increase in capital turnover and mobility at the time of world economic slowdown actually proves the "incompatability thesis" at the heart of the Bretton Woods agreement:.namely, that free international capital mobility is incompatible with the preservation of reasonably free trade and achievement of full employment. What Felix actually says or shows is that the volatility of capital movements has proven inconsistent with worldwide economic growth. That is, that the export/GDP numbers relied on to "prove" globalization only show how anemic output growth has been, not how rapidly the world is "globalizing."

Interesting article. Excellent collection.

All best Christian

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