The Future of Globalization Policy Forum Lunch Keynote: Maurice Obstfeld

TL;DR

The world economy has experienced hyper globalization, marked by significant growth in trade and finance, but now faces challenges such as fragmentation and de-globalization.

Transcript

I'm delighted to introduce our uh third session today which is going to be our keynote session uh and the speaker is going to be my obfelden uh obfelden bergston senior fellow at the Peterson Institute for international economics and the class of 1958 professor of Economics ameritus at University of California at Berkeley from 2015 through 2018 he ... Read More

Key Insights

• 😥 The collapse of the fixed exchange rate system at Bretton Woods in 1973 marked a turning point in the global economic system.
• 🥺 The growth of trade and finance during the era of hyper globalization brought significant benefits, but also led to distributional effects, cultural animosity, and political backlash.
• 🌐 The world now faces new challenges such as globalization backlash, geopolitical tensions, climate change, and health crises that require increased global cooperation.

Questions & Answers

Q: What were the main factors that led to the significant growth in global trade and finance during the era of hyper globalization?

The entry of China into the global economy, the collapse of the Soviet block, and the growth of finance were key factors that contributed to the significant growth in global trade and finance.

Q: Why did the fixed exchange rate system collapse in the 1970s?

The fixed exchange rate system collapsed due to various factors, including President Nixon's departure from the gold standard, the abandonment of fixed exchange rates, oil shocks, and inflationary pressures.

Q: How has the growth of globalization led to distributional effects and challenges in politics and geopolitics?

The growth of globalization has led to structural changes in economies, which can impact communities and redistribute incomes, causing cultural animosity and political backlash. It has also given rise to tensions in geopolitical relations and challenged the hegemonic position of the United States.

Q: What are the main stresses and challenges facing the world economy currently?

Some of the main stresses and challenges include fragmentation, trade policy uncertainty, global trade restrictions, China's rise and revisionist aspirations, tensions over industrial policies and climate change, geopolitical tensions, and issues related to supply chain vulnerabilities.

Summary & Key Takeaways

• The collapse of the fixed exchange rate system at Bretton Woods in 1973 marked the beginning of the end of the post-war global economic system.

• The growth of trade and finance during the era of hyper globalization brought benefits to advanced and developing economies, but also led to distributional effects and other stresses.

• The world now faces new challenges such as globalization backlash, geopolitical tensions, climate change, and health crises that require increased global cooperation.