Globalization and its Discontents is a pleasurable and thought- inciting book. It’s written by one of the most renowned Nobel laureate Joseph E. Stiglitz in 2002. It is perhaps the utmost decipherable, lucid, and delicate attack against globalization during the past couple of years. Though the author struggles, in a slightly rigid style with some shadows of pride, against his ideology of deceitful free-market mindsets, his style is unpretentious and reachable to a widespread audience. However, this is also illusive to some extend. ‘Although the writer stresses on time and again that he is not directing an attack against market principles and globalization overall, he promoter Keynesian policymaking (money printing and deficit spending) on practically every page’ (Kinsella).
It is a pleasant read for those individuals who are in pursuit of the unflawed planet, and it ensembles the benign anti-globalist belief that as man makes mistakes, hence it is advisable to let other fellow individuals to intervene and take corrective measure. ‘In other words, Stiglitz strongly believes that ruthless policymaking can be decreased by educated policymaking, both nationwide and globally’ (Kinsella). He also stresses on the fact that when critical international institutions and economic organizations do not run smoothly, there should be a intervention reforming them, making them more translucent and liable, also decreasing their dependency on special interest.
The writer is also of the belief that the national leaders to some extend prefer the well being of their own kin as compared to others. ‘He also thinks that international organizations, like the IMF and the World Bank, essentially certify that global phenomena to uphold a “human face,” and that national politicians be sustained by somebody in charge when something goes wrong’ (Kinsella). Certainly, it is difficult to examine much economical evidence in such assumptions. Therefore, this can create doubt in the minds of the readers, due to lack of empirical evidence to support this assumption.
The introductory paragraphs in the book set the swiftness. Initially, the writer has made an effort, providing his background, for those readers who lack the knowledge of his major assistances to the world of economics. Professor Stiglitz, the 2001 Nobel Laureate, discloses that he developed fascination in practical worldly problems in 1993, after he become a part of the Clinton administration cabinet. Later, he worked at the prestigious designation of chief economist and senior-vice president at World Bank. The writer asserts that this manuscript is the outcome of such eye-opening incidents; throughout which he established that policymaking procedures are frequently manipulated by politics and belief. He supplementary comprehended that globalization deprived of authority frequently leads to destructive outcomes, particularly on Less Developed Countries (LDCs).
Amazingly, though, the essential disagreement of the book is not the examination of the fundamental connection between ideology, politics, and economic performance in a globalized world. Adequately, the writer retains on focusing on depraved policymaking conceded out both by Western domestic governments and by international establishments. He postulates an undeviating fundamental connection between globalization and bad policymaking, and settles by recommending appropriate policies for international economic administration. As per Stiglitz, these policies should reflect justice and harmony. Moreover, these policies should also be planned through a autonomous procedure so as to assure social impartiality and fulfilling the requirements of as many as they can.
This particular book also analyses that how certain economic policies of IMF deteriorated the Asian economic calamity of the late 1990s and shattered the economies of Russia and various previously Communist nations that were enforced to trail IMF/U.S. Treasury division instructions. ‘Moreover, the economies of numerous Third World countries were destabilized when they were enforced into "structural adjustment" agendas that were merely cookie-cutter presentations of Milton Friedman's economic theories’ (Nissen). Stiglitz points out the fact that these strategies are imprudent but are just avid ideological principles of those individuals governing these organizations, and also signifies the massive influence of various financial division including Wall Street and U.S. banks, on such organizations. ‘He would like to see a reoccurrence to less ideological policies encouraging Keynesian counter-cyclical fiscal events, steady transitions toward freer markets rather than hasty shocks, and more engrossment by the nations and individuals that were affected in developing the policies ’(Nissen). Although the writer in this book is precarious of the "market fundamentalism," he does not evaluate the complete criticism of persons, who are a significant part of the global justice program. ‘Stiglitz is a sturdy follower of globalization, NAFTA, many cases of privatization, and the like, as long as they are carried out in correctly manner’ (Nissen). Here "correctly" signifies the measure of taking it progressively, with pillows for the susceptible, attained through a egalitarian measures. The author desires to civilize the path of globalization, which is being leaded by the corporate entities. He definitely is not a supporter of abolishing it.
In this book it is clearly suggest that the governments can increase the favorable effect by appropriate interferences. On the national level of economics, as households and companies pursue to purchase too less in comparison to what the society can make, governments can battle downturns and recessions by employing expansionary monetary and fiscal policies to stimulate the demand for goods and services. The government bodies also should more precisely synchronize banks and other crucial financial bodies, at a microeconomic level in order to ensure a smooth running economy. The government can also instill the appropriate tax policy in order to enhance the investment in the lucrative industries and construct such trade policies that will assist the newly formed companies against the tough international competiveness until they become established. It also suggests that the governments can use a variation of campaigns, stretching from employment formation to workforce coaching to welfare support, to position unemployed labor back to the labor force and, along with cushioning the human suffering stemming from the economic vices of incomplete information, or from various markets and organizations.
‘Stiglitz criticizes that the IMF has done excessive destruction through the economic policies it has recommended that countries must obey in order to succeed for IMF loans, or for loans from banks and other private-sector lenders that look to the IMF to designate whether a borrower is creditworthy’ (Friedman). The corporation and its administrators, he debates, have overlooked the consequences of inadequate information, insufficient markets, and ineffectual establishments, all of which are specifically distinguishing of recently developing nations. In respective of that, the author reasons that from time to time the IMF has entitled such strategies that correspond to paradigmatic economics but is not suitable for the states that IMF is implementing it in. Stiglitz pursues to display that the penalties of these mistaken strategies have been catastrophic, not just rendering to nonfigurative numerical measures but in real human misery, in the nations that have obeyed these policies.
The writer has narrated, as efficiently as it is conceivable to envision anyone making it, his side of the case, containing the practical incident for the kind of economic development strategies he approval as well as his more precise arraignment of the doings of IMF and the reasons behind it. This particular book is a test. It is now imperative another individual who is as capable as Stiglitz, holding same narrating skills and a comprehensively understanding of the economic theory along with a personal experience of being a crucial part of the financial system, steps in taking up the challenge thrown by Stiglitz and writing counter arguments. It has created a room not only to answer the criticism of IMF posed by Stiglitz but also putting out the essential illustration both for the precise strategies along with the common policy tactic that the IMF has encouraged.
Works Cited
Friedman, Benjamin M. "Globalization: Stiglitz's Case." New York Book of Reviews. Web. 10 Dec. 2014. <http://www.nybooks.com/articles/archives/2002/aug/15/globalization-stiglitzs-case/?page=3>
Kinsella, Stephan. "BOOK REVIEWS." Journal of Libertarian Studies. Web. 10 Dec. 2014. <http://mises.org/sites/default/files/18_1_3.pdf>.
Nissen, Bruce. "Project MUSE - Globalization and Its Discontents (review)." Project MUSE - Globalization and Its Discontents (review). Web. 10 Dec. 2014. <http://muse.jhu.edu/journals/lab/summary/v028/28.3nissen.html>.
