Second chances: Stiglitz and Fair Trade for All
It’s always great to pick up a new work by an author and realize he’s done exactly what you hoped he would do. Such was my feeling when I started reading Joseph Stiglitz’s new book, written with Andrew Charlton.
In Stiglitz’s last work, entitled Making Globalization Work, he mostly rehashed criticism from Globalization and its Discontents, leading to my bad review. Basically, he detailed why current patterns of globalization aren’t working, and stopped there.
Finally, in the most recent piece, Fair Trade for All, Stiglitz gets down to details: If he were benevolent emperor of the world, how would he run the WTO and the next round of negotiations? The book actually ventures into lots of messy, policy-wonkish details, so readers without a basic knowledge of economics might be a bit lost. All this messiness is actually kind of liberating to read: an economist actually arguing (with data) that particular countries and cultures require particular development strategies, not some grand philosophy a la “The Washington Consensus”. It reminds me a bit of Jeffery Sachs’ concept of “clinical economics”.
I can’t pretend to pass judgment on all of Stiglitz and Charlton’s suggestions, for I’m not an economist. The central argument is that in a true “Development Round” of WTO negotiations, proposals should maximize gains to poorer countries. Provocatively, they argue that “all WTO members commit themselves to providing free market access in all good to all developing countries poorer and smaller than themselves.” This is, of course, the complete opposite of the current unjust trading system. As a corollary, they present good evidence that it is mainly via increased South-South trade that least developed countries can lift themselves up.
At one point in a parenthetical statement they express regrets about the inclusion of “the infamous Chapter 11 of Nafta” (i.e., foreign firms can sue and win if a country reduces their profit via a regulation, even a totally reasonable one), essentially implying that trade negotiators put it in with Stiglitz and others approving. Anyone out there know if this historically substantiated?
In Stiglitz’s last work, entitled Making Globalization Work, he mostly rehashed criticism from Globalization and its Discontents, leading to my bad review. Basically, he detailed why current patterns of globalization aren’t working, and stopped there.
Finally, in the most recent piece, Fair Trade for All, Stiglitz gets down to details: If he were benevolent emperor of the world, how would he run the WTO and the next round of negotiations? The book actually ventures into lots of messy, policy-wonkish details, so readers without a basic knowledge of economics might be a bit lost. All this messiness is actually kind of liberating to read: an economist actually arguing (with data) that particular countries and cultures require particular development strategies, not some grand philosophy a la “The Washington Consensus”. It reminds me a bit of Jeffery Sachs’ concept of “clinical economics”.
I can’t pretend to pass judgment on all of Stiglitz and Charlton’s suggestions, for I’m not an economist. The central argument is that in a true “Development Round” of WTO negotiations, proposals should maximize gains to poorer countries. Provocatively, they argue that “all WTO members commit themselves to providing free market access in all good to all developing countries poorer and smaller than themselves.” This is, of course, the complete opposite of the current unjust trading system. As a corollary, they present good evidence that it is mainly via increased South-South trade that least developed countries can lift themselves up.
At one point in a parenthetical statement they express regrets about the inclusion of “the infamous Chapter 11 of Nafta” (i.e., foreign firms can sue and win if a country reduces their profit via a regulation, even a totally reasonable one), essentially implying that trade negotiators put it in with Stiglitz and others approving. Anyone out there know if this historically substantiated?
