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Friday, May 2, 2008
What I said at the London conference Is summarized in https://blogs.princeton.edu/globalforum/2008/05/panel-6-the-global-economy.htmlthis blog post. And I might have been the most upbeat person on the panel! Friday, April 25, 2008
This is funny? Really? Look, I like ripping into Thomas Friedman as much as the next blogger -- but I can't agree with Matt Yglesias that the following video is "funny": This is the kind of thing that accomplishes the following:A) It makes some people who dislike Friedman very happy;Matt also suggests checking out his book Heads in the Sand as "a more intellectually rigorous Friedman takedown." That's great, but damning with faint praise. I'm pretty sure my seven-year old could muster a more intellectually rigorous takedown as well. Admittedly, I think he's an exceptionally smart seven year old, but still.... UPDATE: Jonathan Chait agrees with me on this: I don't think I'm particularly sensitive, but I find the notion of physically humiliating somebody who's trying to explain their ideas in a civic forum to be absolutely horrifying.For a more virtuous -- and more amusing -- example of pie-throwing, click here. Friday, February 29, 2008
Sovereign wealth fund = greater transparency? A common lament about sovereign wealth funds is their lack of transparency -- no one knows their investment strategy. The chart below -- cribbed from a Standard Chartered report summarized by the FT's Martin Wolf -- makes this visually clear: It's generally assumed that a chief source of this opacity is that the governments chruning out SWFs are largely authoritarian and this impervious to domestic scrutiny. I tend to agree with this assessment. But I did find this Wall Street Journal op-ed by Heidi Crebo-Rediker and Douglas Rediker to be counterintuitively interesting on this point -- transparency on SWFs would have domestic effects within these countries as well: When even the most secretive sovereign wealth fund makes an investment, it must comply with the disclosure obligations of the countries in which it is investing. So, when the newly formed China Investment Corporation bought into Blackstone last summer, it was compelled to disclose the terms of the deal and other material information as part of Blackstone's regulatory filings in the U.S. That turned out to have some very real consequences back home.Read the whole thing. Wednesday, February 6, 2008
Your cool statistic for the day The AP reports some pretty stunning news: The number of mobile phone users will overtake the number of nonusers this year for the first time, according to the U.N. telecoms agency.I would be more impressed, however, if this piece of information appeared anywhere on the International Telecommunications Union main web page. Thursday, December 6, 2007
So much for China's Olympian vulnerability I've blogged a few times about whether China's hosting of the 2008 Summer Olympics has increased the government's vulnerability to domestic and external political pressure. The Christian Science Monitor's Peter Ford reports that in advance of the Games, China's government is devising new ways to handcuff indigenous NGOs: Last Thursday morning, five law-enforcement agents marched into Zhai Minglei's Shanghai apartment, seized his computer hard disk and copies of the small magazine he used to publish, and ordered him to report for questioning the next day.It should be noted that this reaction to the color revolutions is not unique to China -- it mirrors what governments in Russia, Iran, and Central Asia have done as well. Wednesday, December 5, 2007
So will Bali accomplish anything? When it comes to enegy and the environment, anything David Victor writes is worth reading. In Newsweek, Victor suggests that the upcoming Bali summit won't achieve much of anything: The effort, though noble, is largely irrelevant to the urgent task of cutting greenhouse-gas emissions. The countries that care the most about successful U.N. talks are a small and shrinking part of the problem. Those that matter most—notably China, which in 2007 became the world's largest emitter of warming gases—have exempted themselves from any regulation of their effluent. The Bali agenda offers no route around this impasse and will probably make it harder to solve in the future. Sunday, July 22, 2007
The public aims at the wrong bogeymen
What you see above you is the result of a Financial Times/Harris poll among various OECD countries about globalization (note, by the way, that the FT wierdly flip-flops the categories halfway through the graph). The associated story sums it up as follows: The depth of anti-globalisation feeling in the FT/Harris poll, which surveyed more than 1,000 people online in each of the six countries, will dismay policy-makers and corporate executives. Their view that opening economies to freer trade is beneficial to poor and rich countries alike is not shared by the citizens of rich countries, regardless of how liberal their economic traditions.Indeed, as the poll shows, there's either majority or plurality enthusiasm for "setting pay caps for the heads of companies." The breadth of support surprises Mark Thoma. For a pro-globalization type like me, there's not a lot that's funny about this kind of public sentiment. There is something ironic, however, about the extent to which publics believe that this kind of measure will reduce income inequality. On this point, I click over to Marginal Revolution and find the following: We consider how much of the top end of the income distribution can be attributed to four sectors -- top executives of non-financial firms (Main Street); financial service sector employees from investment banks, hedge funds, private equity funds, and mutual funds (Wall Street); corporate lawyers; and professional athletes and celebrities. Non-financial public company CEOs and top executives do not represent more than 6.5% of any of the top AGI brackets (the top 0.1%, 0.01%, 0.001%, and 0.0001%)....Oh, and there's no apparent correlation between higher pay and the openness of a sector to international trade. To be fair, I suspect publics would support capping the income of Wall Street groups if they were asked. CEOs might simply be a proxy for "evil capitalist pg-dogs." That said, CEOs do tend to be the first target whenever this kind of sentiment is translated into political action. I can't dispute the rising resentment about rising inequality -- but that doesn't mean that the resentment has acquired the correct target (I don't think there is a clear target, but that's a topic for another day). There is support, clearly, for some really stupid policies. Monday, July 16, 2007
Coping with the global economy In response to my last post on the rise of economic populism among Democrats (admittedly, one of a long series), Kevin Drum poses the following questions to yours truly: Answers to these questions after the jump.... 1) The trouble with populism is (mostly) not about the remaining 10% of barriers to trade (though see below), it's about efforts to f$%& up the 90% of barriers that have been dismantled. The Baucus-Grassley-Schumer-Graham bill, for example, isn't about halting new trade openings -- it's about finding new ways to clamp down on existing openness.I now officially triple dog-dare the Democrats to embrace any or all of these proposals. Thursday, July 5, 2007
For China Inc., it's going to get worse before it gets better David Barboza reports in the New York Times on another nail in the coffin that is China's reputation for product quality: China said on Wednesday that nearly a fifth of the food and consumer products that it checked in a nationwide survey this year were found to be substandard or tainted, underscoring the risk faced by its own consumers even as the country’s exports come under greater scrutiny overseas.This is going to be a huge, long-term headache for Beijing. Brand images are not easy to change, and China has been beset by a perfect storm of health and safety scares over the past six weeks. Furthermore, as Barboza points out, improving the brand is not merely a function of the central government "getting it" (and cases like this one suggest that they do not "get it" across the board): Experts say aggressive and opportunistic entrepreneurs continue to take advantage of the country’s chronically weak enforcement of regulations, choosing to blend fake ingredients into products; to sign contracts agreeing to sell one product only to later switch the raw materials for something cheaper; and to doctor, adulterate or even color foods to make them look fresher or more appetizing, when in fact they might be old and stale.strong enforcement of regulations will require a widespread change in both the government and business cultures, and addressing head-on issues of corruption. In other words, this problem won't be going away anytime soon. Tuesday, June 26, 2007
China Inc. is developing a bad brand image The growth of health and safety concerns about Chinese imports is not fading away into the night. The Wall Street Journal's Timothy Aeppel reports that tires are the latest product to raise concerns: A fatal auto accident in Pennsylvania has stirred concerns about another potentially hazardous Chinese product in wide use in the U.S.: tires.As a country develops and moves up the consumer supply chain, they generally acquire a reputation for making high-quality goods (think Japan and South Korea). What's interesting is that China seems to be moving in the opposite direction. I have no doubt that U.S. industry associations will hype consumer health and safety fears to serve their own interests. This doesn't mean they're wrong, however.
Monday, June 18, 2007
The rise of trans-Pacific regulatory conflict In the past two days there have been two stories in the press suggesting that the U.S. will be butting heads with China and India over a variety of regulations. On Sunday, the Washington Post's Marc Kaufman writes that the growth of pharmaceutical imports is triggering health and safety concerns: India and China, countries where the Food and Drug Administration rarely conducts quality-control inspections, have become major suppliers of low-cost drugs and drug ingredients to American consumers. Analysts say their products are becoming pervasive in the generic and over-the-counter marketplace.Meanwhile, in USA Today, Jayne O'Donnell reports about another brewing regulatory problem -- lead levels in childrens' jewelry: The Chinese government opposes a proposed U.S. standard limiting the amount of lead allowed in bracelets, necklaces and other jewelry sold for children.If you read both articles, these two cases are not identical. There appears to be a strong justification for ratcheting up the lead regulations, while problems with pharmaceutical imports remain more hypothetical than real. Going forward, it will be interesting to see whether affected domestic industries will be lobbying for regulatory barriers rather than more overt forms of protectionism. The thing about regulatory barriers is that they are not always protectionist in motivation. And that's precisely what makes them more attractive for import-competitive sectors. Developing.... UPDATE: Thanks to Nicholas Weaver for sending me this New York Times story by Walt Bogdanich on Chinese resistance to regulatory investigations. Definitely worth a read. Friday, June 15, 2007
Cato Unbound, part deux The Cato Unbound debate about All Politics Is Global continues with response essays: 1) Ann Florini, "Globalization Is Transformative."My response to the critiques can be found here. I want to believe the Zagats -- I really do Nina and Tim Zagat have an op-ed in today's New York Tmes about why Chinese food in the United States is substandard. I should sympathize with their argument: Twenty years ago, American perceptions of Asian food could be summed up in one word: “Chinese.” Since then, we have developed appetites for Korean, Japanese, Thai and Vietnamese fare. Yet while the quality of the restaurants that serve these cuisines, particularly Japanese, has soared in America, Chinese restaurants have stalled. For American diners, the Chinese restaurant experience is the same tired routine — unimaginative dishes served amid dated, pseudo-imperial décor — that we’ve known for years....Hmm.... reducing barriers to exchange, increasing globalization of cuisine... I should be on this proposal like white on rice. Except that the Zagats' policy solution does not explain their policy conundrum. Immigration barriers should have a roughly equal effect on all Pacific Rim cuisines, not just China's. Why would it be the case that Chinese cuisine in the U.S. is particularly disadvantaged by vsa restrictions? Three possibilities: 1) Because China has a larger internal market, there is more innovation and competition at home, leading to more frequent innovations. Without a reliable transmission mechanism (i.e., migrating chefs), Chinese cuisine in China will improve at a faster rate than in the U.S.A.I'm willing to endorse more culinary trade as a matter of principle, but I'd still like a good explanation for this conundrum. Take it away, Tyler Cowen! Monday, June 11, 2007
Drezner gets interesting results from Vladimir Putin Hey, remember that Foreign Affairs essay I wrote called "The New New World Order?" If you don't, that's OK -- but it appears that Vladimir Putin has been reading it. From the Financial Times' Neil Buckley and Catherine Belton: Russian president Vladimir Putin called on Sunday for a radical overhaul of the world’s financial and trade institutions to reflect the growing economic power of emerging market countries – including Russia.What's interesting about this speech is that Putin is correct in describing the state of the world, but not necessarily correct in his belief that "a new architecture of international economic relations" is going to serve Russia's interests. Consider that Russia is already a member of one powerful club -- the G-8. Any realistic reform of global economic governance is going to give China and India more power than Russia relative to the status quo, because Russia still has the great power trappings it inherited from the Cold War. Indeed, unless we're talking about energy or nuclear weapons, Russia would be a less powerful actor after any reform effort. Putin probably does not believe this, given sustained interest in the Russian economy and the comfort of high oil prices. Russia, however, should be very wary of what it wishes for -- it might just get it. UPDATE: Brad Setser offers up a different new new world order: This new international order is just dominated by big national institutions -- SAFE and the PBoC, the Bank of Russia, the Saudi Arabian Monetary Agency, the Abu Dhabi Investment Authority and the like -- not big international institutions. The international financial institutions of the old international economic order -- the IMF for example -- are still around. But they don't have as much influence as they once did. Wednesday, June 6, 2007
The topic of this month's Cato Unbound is..... Why, hey, what do you know, the topic of June's Cato Unbound will be All Politics Is Global: Explaining International Regulatory Regimes My lead essay, "The Persistent Power of the State in the Global Economy," is now up. Response essays will be written by Jeremy Rabkin, Ann Florini, and Kal Raustiala. Go check it out. Saturday, April 21, 2007
On global warming, life will not be fair Reuters reports the latest trends in CO2 emissons: China will overtake the United States as the world’s biggest emitter of heat-trapping carbon dioxide (CO2) either this year or next, the International Energy Agency said on Wednesday.Read the whole thing. One could argue -- as China will -- that the U.S. produces far more pollutants per person -- not to mention the fact that the OECD countries are responsible for much of pre-existing pollution in the atmosphere. However, if this IPCC report is correct, then global warming will have disproportionate effects on the poorer countries of the world. From a bargaining perspective, it will be interesting to see whether this effect will put greater pressure on China than the United States. Saturday, March 31, 2007
Baptists, bootleggers, and porn CNET's Dawn Kawamoto reports that the .xxx registry will not be happening anytime soon: The Internet Corporation for Assigned Names and Numbers has rejected a controversial proposal to create a new .xxx domain suffix for adult Web sites.In the New York Times, Thomas Crampton explains the interesting coalition of interest groups that opposed the .xxx registry: ICM had argued that creation of the domain would enhance safety for young users by clearly defining .xxx sites as a no-go zone.Political scientists talk about "baptist-bootlegger coalitions" to explain occasions when groups on opposite sides of an issue support the same policy for very different reasons (baptists: naive expression of preferences; Bootleggers: rent-seeking). In this case, however, the baptists refused to side with the powerful bootlegger. Monday, March 26, 2007
Is the U.S. more cosmopolitan.... or just bigger and more powerful? On his Financial Times blog, Gideon Rachman suggests that Americans are more cosmopolitan than Brits: We are all familiar with the clichés about American insularity: the number of Congressmen who don’t have a passport, the number of Americans who have never left the US – and so on.Much as I like the back-slapping of America, a few obvious points of caution are warranted. The most obvious is this one: the United States has roughly five times the population of Great Britain. It shouldn't be that surprising, therefore, if a book sells better five times here or a foreign policy event attracts a much larger crowd. Second, cosmopolitan implies more than just a keen sense of foreign policy interest -- there are cultural dimensions as well. The U.S. might stack up well in that department as well, but it's not a part of Rachman's post. Now, that said, assuming that Rachman's point is still correct, is this because "America is still enjoying its imperial moment." Well, right now I would use neither the word "imperial" nor "enjoying." That said, what the U.S. does have in place is a foreign policy infrastructure that's second to none at this point. Beyond the official organs of the federal government, there are a host of quasi-governmental organizations, think tanks, NGOs, foundations, and yes, God forbid, universities with a vested interest in thinking about the world and America's place in it. Sixty years of superpower status will have that effect. The interesting question to ponder is how long it will be before another country -- or supranational institution -- matches American investments in this area. There is a lag between the acquisition of power and the development of domestic and international institutions to convert that power into authority. |