Globalization and Its Discontents (Norton Paperback)
Joseph E. Stiglitz
Format: PDF / Kindle (mobi) / ePub
This powerful, unsettling book gives us a rare glimpse behind the closed doors of global financial institutions by the winner of the 2001 Nobel Prize in Economics.
When it was first published, this national bestseller quickly became a touchstone in the globalization debate. Renowned economist and Nobel Prize winner Joseph E. Stiglitz had a ringside seat for most of the major economic events of the last decade, including stints as chairman of the Council of Economic Advisers and chief economist at the World Bank. Particularly concerned with the plight of the developing nations, he became increasingly disillusioned as he saw the International Monetary Fund and other major institutions put the interests of Wall Street and the financial community ahead of the poorer nations. Those seeking to understand why globalization has engendered the hostility of protesters in Seattle and Genoa will find the reasons here. While this book includes no simple formula on how to make globalization work, Stiglitz provides a reform agenda that will provoke debate for years to come. Rarely do we get such an insider's analysis of the major institutions of globalization as in this penetrating book. With a new foreword for this paperback edition. Those seeking to understand why globalization has engendered the hostility of protesters in Seattle and Genoa will find the reasons here. While this book includes no simple formula on how to make globalization work, Stiglitz provides a reform agenda that will provoke debate for years to come. Rarely do we get such an insider's analysis of the major institutions of globalization as in this penetrating book. With a new foreword for this paperback edition.
lon~t'r l;llllI.HII..HHlN .\Nl> ITs DISCONTENTS be i~n"rt·d. the cost to the taxpayer was far larger. But the ll'vlF "verlookt'd anclther critical lesson: the importance of keeping crt·dit tlowin~. Its strJte~'Y tor tin.lIlcial restructuring involved triage--separating out the reallv sick bJnks. which should be dosed immediately, from the healthy b.lIIks. A third group were those that were sick but repJrJble. UJnks are required to have a certain ratio of capital to their outstJnding 10Jns and
pr<'selKe of the massive economic downturn, there were real macrobenetits from rapid financial restructuring. Individual participants in the bargaining surrounding bankruptcy workouts would fail to take into account these systemic benefits. It might pay them to drag their feet-and bankruptcy negotiations are often protracted, taking more than a year or two. When only a few firrns in an economy are bankrupt, this delay has little social cost; when many firms are in discress, the social cost can be
and reversed its support for fiscal contraction in East Asia, it said it was because the time was right. I would suggest that it reversed courses partly due to public pressure.) But in Asia other theories abound, including a conspiracy theory that I do not share which views the policies either as a deliberate attempt to weaken East A~ia-the region of the world that had shown the greatest growth over the previous forty years-or at least to enhance the incomes of those on Wall Street and the other
property and the profit motive. inceiltives--especially managerial and entrepreneurial incentives-were lacking. Th~ restricted trade regime, combined with huge subsidies and arbitrarily set prices. meant the system was rife with distortions. It followed that replacing centralized planning with a decentralized market system, replacing public ownership with private property, and eliminating or at least reducing the distortions by liberalizing trade, would cause a burst of economic output. The
chance to hear the full range of issues and views. Treasury viewed the issue as too iPlportant to let the president have an important role in making the decisions. Perhaps because of the lack of interest from the American people, Clinton himself did not feel that this issue was important enough for him to demand an accounting in greater detail. U.S. INTERESTS AND RUSSIAN REFORM There are many in Russia (and elsewhere) who believe the failed policies were not just accidental: the failures were