Globalization is the attractive word that has been given to the global actions of ideas, capital, goods and people. It is one of the most powerful forces reshape our planet. All of us can remember a time when foreign goods were smuggled, foreign travel was a rarity, foreign books and magazines were hard to come by, where ISD calls required spending Rs 120 per minute, and where email did not exist. While that world is inevitably gone, there is considerable debate on whether its demise was a good thing.
Two prominent recent books have pondered the issues: one by Joseph Stiglitz, titled "Globalization and Its Discontents", and the more recent book by Jagdish Bhagwati titled In "Defense of Globalization". Stiglitz is a Nobel Laureate, for his brilliant work on the economics of information. Bhagwati is very likely to get a Nobel Prize, for his brilliant work on trade theory and the political economy of economic development.
It may be said that he translated a ringside view of the cancerous growth of the Indian state in the 1960s into a Nobel Prize.
The two books are sometimes caricatured in the press as representing opposite viewpoints. Bhagwati is portrayed as an "orthodox economist" (if there can be such a thing), and Stiglitz as a renegade and an iconoclast. Upon reading both books, I certainly did not come away with such a feeling. I found much wisdom and insight in both books, and felt that both authors would agree with each other about the impact of the mobility of goods, capital, labour and technology.
These may be summed up as follows. One, the movement of ideas is good: our lives are better off because we learned about vaccination or spark plugs. Two, the movement of capital is good: the growth of a...