Tag Archives: Business

The Globalization Backlash: It’s Both Culture and the Economy, Stupid

BOOK REVIEW

Euroscepticism and the Future of European Integration, Author: Catherine De Vries.
Globalization represents a “trilemma” for societies, Author: Dani Rodrik.

By Catherine De Vries – While many thought the process of greater cross-border cooperation to be irreversible, in part because it was expected to lead to a universal acceptance of liberal and capitalist values, isolationism, nationalism and protectionism are back on the political scene with a vengeance.

While Donald Trump’s slogan to “Make America Great Again” is at the heart of his campaign and current administration, Nigel Farage’s mantra of taking back control (“we will win this war and take our country back”) dominated the Brexit campaign.

A fierce debate has developed about the origins of these developments. Are they the result of economic grievances of those who feel threatened by globalization (a term for increasing international cooperation and increasing interdependence), or do current developments represent a cultural backlash based on immigration fears and prejudice.

Opposition to globalization is gaining such a foothold in the political and public domain in advanced industrial democracies, precisely because processes of economic interdependence have coincided with increasing migration flows.

Although current societal and academic debates are mostly framed in either economic or cultural terms, it is important to realize that these types of explanations are not mutually exclusive. We should focus more of our efforts on trying to understand how cultural and economic fears interact and fuel the recent popular backlash against globalization. more>

The Western Crack-Up

By Javier Solana – After the recent G7 summit in Quebec, there can no longer be any doubt that the West is in crisis.

Yes, “Western” countries have often pursued divergent foreign policies (as illustrated by the Iraq War), and “the West” is itself a vague concept. But it is one that rests on a set of common ideological pillars, which are now crumbling under the weight of US President Donald Trump’s “America First” agenda.

Trump and his co-religionists’ incessant slandering of allies – “we cannot let our friends take advantage of us” – is leaving its mark.

Just a few years ago, it would have been unthinkable for the US to refuse to sign a joint G7 communiqué. Nor would anyone have thought that an American administration could attack a Canadian leader using the language that Trump and his trade adviser, Peter Navarro, recently directed at Canadian Prime Minister Justin Trudeau.

If bad manners were the only issue with the Trump administration, we could all rest easier. But that administration is also pursuing concrete policies that are undercutting America’s most important alliances. more>

American power at stake in great innovation race


By Peter Engelke – Americans like to think of themselves as the most innovative people in the world. At least since 1945, they have had good reason to believe so. During the Cold War, the United States built the most formidable technology-producing innovation system the world has ever seen.

Coordinated action by the U.S. government, the private sector and academia, combined with America’s unique postwar culture, crafted this system.

But the American system has seen better days. America’s leaders, at federal and state levels, have failed to maintain this system much less upgrade it.

As a result, America’s long list of difficulties includes falling public investment in research and development (R&D, a critical and under-appreciated factor in national innovativeness), an under-skilled workforce, flagging support for public higher education, decaying infrastructure and much more.

The global tech-innovation economy therefore is more than a just crowded place. It is also crowded where it counts: at the very top, where it no longer can be said that the U.S. stands alone. Several of the countries listed here, plus others, routinely score higher than the United States in global innovation rankings.

The U.S. will not long remain the global leader in innovation unless it takes decisive action across several fronts. more>

To get a grip on altruism, see humans as molecules

By Ski Krieger – ‘What is life?’

In 1943, Erwin Schrödinger posed this question in a series of lectures at Trinity College, Dublin.

Seventy-five years later, the biophysics revolution is ongoing. Schrödinger’s call to action inspired his colleagues to look at the building blocks of life at all scales, from the diminutive DNA molecule to schooling fish and the construction of anthills.

My research group at Harvard University focuses on altruism, or why creatures sacrifice themselves for the common good.

But rather than relying on psychology or moral philosophy, we approach this problem using thermodynamics – how the laws governing heat and the interaction of microscopic particles might translate into macroscopic behavior. Can we explain altruism by casting humans as atoms and molecules, and societies or populations as solids, liquids or gases?

By studying each of these phases as physicists, we come away approaching a recipe for altruism – rules for certain structures that might foster cooperation.

What we’ve observed so far is that strong local connections enhance altruism everywhere. more>

You don’t have a right to believe whatever you want to

BOOK REVIEW

Understanding Ignorance: The Surprising Impact of What We Don’t Know, Author: Daniel DeNicola.

By Daniel DeNicola – Do we have the right to believe whatever we want to believe? This supposed right is often claimed as the last resort of the willfully ignorant, the person who is cornered by evidence and mounting opinion: ‘I believe climate change is a hoax whatever anyone else says, and I have a right to believe it!’ But is there such a right?

We do recognize the right to know certain things. I have a right to know the conditions of my employment, the physician’s diagnosis of my ailments, the grades I achieved at school, the name of my accuser and the nature of the charges, and so on. But belief is not knowledge.

Unfortunately, many people today seem to take great license with the right to believe, flouting their responsibility. The willful ignorance and false knowledge that are commonly defended by the assertion ‘I have a right to my belief’ do not meet William James’s requirements.

Beliefs shape attitudes and motives, guide choices and actions. Believing and knowing are formed within an epistemic community, which also bears their effects. There is an ethic of believing, of acquiring, sustaining, and relinquishing beliefs – and that ethic both generates and limits our right to believe.

Some beliefs are false, or morally repugnant, or irresponsible, and some beliefs are also dangerous. And to those, we have no right. more>

The Next Trend In Travel Is… Don’t.

By Allison Jane Smith – Bali is in the midst of an ecological crisis. Half of the Indonesian island’s rivers have dried up. Its beaches are eroding. In 2017, officials declared a “garbage emergency” across a six-kilometer stretch of Bali’s coast. At the peak of the clean-up, hundreds of cleaners removed 100 tons of debris from the beaches each day.

The cause? Too many tourists — who just keep coming. This year, the Indonesian tourism ministry hopes Bali attracts 7 million foreign tourists, to an island of only 4 million residents.

Bali is one among many places to feel the ill effects of mass tourism. Thailand closed an entire island because litter and food waste from tourists were destroying the island’s ecosystem.

In Venice, Italy, colossal cruise ships tear straight through the city and affordable Airbnb options push residents out of the housing market.

Across Spain, anti-tourism graffiti can be found in Barcelona, San Sebastian, Bilbao, and Mallorca, declaring “tourism kills,” “tourists go home” and “why call it tourism season if we can’t shoot them?”

When tourism dominates an economy, some governments prioritize tourists over their own citizens. Around the world, people are evicted from their homes to make way for tourism developments.

Globally, displacement for tourism development — including hotels, resorts, airports, and cruise ports — is a growing problem. In India, tens of thousands of indigenous people were illegally evicted from villages inside tiger reserves.

No wonder even those in the business of selling travel are urging tourists to reconsider visiting certain destinations. more>

Colliding Worlds: Donald Trump And The European Union

By Michael Cottakis – US President Donald Trump is not naturally inclined towards the EU. The EU represents the antithesis of what Trump aspires for in himself, or of the value he sees in others. For the President, the EU is an essentially effete project – a civilian power that likes to see itself as human rights based and collegiate, but with no hard power of its own. It is not a real force in the world because it cannot project military power, or speak with a single, unified voice, putting its interests first.

A defensive Brussels, reeling from recent crises and keen to assert itself as an important international actor may, with provocation, respond.

The European Commission tends to respond to Trump’s provocations with smugness and belittlement. Other European leaders are cannier and understand better the risks of such an approach. Emmanuel Macron has adopted the guise of the EU’s chief diplomat to the US, speaking regularly with Trump. Climate change, Iran, trade policy and Syria have all been on the French President’s agenda. While discussions remain relatively cordial, little impact is being made in policy terms.

The international system is greatly changed. A battle of new world views, political and socio-economic models is at play in which new authoritarian values gain ground at the expense of traditional ‘western’ values. The international influence of the US is determined not only by the number of its weapons, or the power of its commerce. Traditionally, it is a consequence also of its power of attraction, the emancipatory quality of its core values – democracy, human rights, economic openness. These values, and their adoption by third countries, have helped drive the world to levels of prosperity never before experienced.

These achievements ought not to be squandered. more>

How Social Media Became a Pink Collar Job

By Jessi Hempel – One job in the digital economy falls predominantly to women. It’s an oft-overlooked position, drawing on both marketing and editorial skills, that has become increasingly critical both to business success and online discourse. The pay is poor, and the respect can be limited. Take a look at the job posting for any social media manager. You’ll discover the same bias in its language, in reverse: a bias for sourcing female candidates.

The feminized nature of social media employment, Brooke Erin Duffy and Becca Schwartz argue, is connected to its “characteristic invisibility, lower pay, and marginal status” within the tech industry.

The study also suggests companies are seeking out candidates capable of “emotional labor.” This falls into two buckets. Companies advertise for candidates who are “upbeat” and “kind-hearted,” and capable, generally, of the emotional finesse involved in wrangling a brand’s messages into 140-character tweets, managing its employees so that they participate, and interacting with the wider audience of brand loyalists.

But social managers must also withstand the vitriol of the trolls who target Tweeters and posters with an expanding vocabulary of hate speech. more>

Declining Majority of Online Adults Say the Internet Has Been Good for Society

By Aaron Smith and Kenneth Olmstead – Americans tend to view the impact of the internet and other digital technologies on their own lives in largely positive ways, Pew Research Center surveys have shown over the years. A survey of U.S. adults conducted in January 2018 finds continuing evidence of this trend, with the vast majority of internet users (88%) saying the internet has, on balance, been a mostly good thing for them personally.

But even as they view the internet’s personal impact in a positive light, Americans have grown somewhat more ambivalent about the impact of digital connectivity on society as a whole. A sizable majority of online adults (70%) continue to believe the internet has been a good thing for society. Yet the share of online adults saying this has declined by a modest but still significant 6 percentage points since early 2014, when the Center first asked the question. more>

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Updates from Chicago Booth

Globalization is close to its ‘holy cow’ moment. Why we must rethink our outdated ideas about international trade.
By Richard Baldwin – Globalization has changed.

The globalization we knew and understood for most of the 20th century resembled more the globalization that emerged from the Industrial Revolution than it did the globalization we experience today.

That globalization was based on the movement of goods across borders—measurable, limited by physical infrastructure, and parried by policies such as tariffs. But globalization today is about more than trading goods; it’s about trading ideas and, increasingly, services.

Our 20th-century paradigms of globalization are ill-equipped to understand what cross-border trade means for the present and near future. Globalization has changed, but the way we think about it hasn’t.

The one thing that hasn’t changed about globalization is that it is a phenomenon with the power to change the world. If you trace the share of world income going to two groups of countries—India and China in one group and the G7 countries in the other group—back to the year 1000, you’ll see that back then, India and China had about half the world’s GDP, and the G7 had less than 10 percent of it.

Starting around the 1820s—the decade economists Kevin H. O’Rourke of Oxford and Jeffrey G. Williamson of Harvard have pegged as the start of modern globalization—the G7 share starts to swell. Over the course of about 170 years, it goes from about one-fifth up to about two-thirds of world income. That’s how powerful globalization—the movement of goods across borders—was.

Globalization is arbitrage. What is arbitrage? It’s taking advantage of a variation in price between two markets. When the relative prices of some goods are cheap in Mexico, that’s what they sell to us, and when other goods are relatively cheap in the US, that’s what we sell to them. A two-way, buy-low/sell-high deal—that’s arbitrage, and trade theory is all about what the direction of arbitrage, and especially arbitrage in goods, is. more>

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