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  5. Recent History of Global Integration: The Globalization Wave of the 1980s and 1990s
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Recent History of Global Integration: The Globalization Wave of the 1980s and 1990s

Paper Session

Friday, Jan. 7, 2022 12:15 PM - 2:15 PM (EST)

Hosted By: American Economic Association
  • Chair: Claudia Steinwender, Ludwig Maximilian University of Munich

The Trade Reform Wave of 1985-1995

Douglas A. Irwin
,
Dartmouth College

Abstract

The decade from 1985-1995 will go down in history as an unprecedented period in which global trade barriers were reduced. Much of the liberalization was unilateral in the developing world, particularly in Latin America and Asia (India & China), but other trade agreements (NAFTA, EU single market, Uruguay Round) were also prominent in the period. What accounts for this remarkable shift in policy? This paper highlights the role of ideas and interests in response to the global recession and debt crisis of the early 1980s, as well as the collapse of communism and rise in democracy after 1989, as important factors driving the policy change.

The Dismantling of Capital Controls after Bretton Woods

Diana Van Patten
,
Yale University

Abstract

This paper explores the role of impediments to international capital mobility, foreign direct investment, and technology diffusion in shaping Latin American economic growth. First, the paper studies the effects of the Bretton Woods international financial system, which was in place from 1949 to 1973, and attempted to support international economic and political stability through regulations that governed international trade, payments, and currency values. These impediments to international capital flights can explain significant consumption gains in Latin America in this time period. Then, the paper studies the potential gains of foreign direct investment and trade-induced technological advancements in shaping local development, especially after the trade liberalization policies implemented in the 1980s in several countries of the region.

The Half-Century Resurgence of Global Migration: Origins and Consequences

Michael A. Clemens
,
Center for Global Development and IZA

Abstract

Since the 1970s, workers have moved between countries at rates not seen since before World War One. And this time has been different: Today the average migrant is in a place more economically and ethnically distant from home than a century ago. Why did global migration resurge, and how has this shaped the world economy? Counter to the simplest economic models, the resurgence of international migration arose not from economic underdevelopment but from development itself, and arose not as a substitute for goods and capital flows but complementary to them. Its ubiquitous economic effects have included higher global GDP and lower global inequality, higher GDP but higher pretax earnings inequality in the destination countries, massive investment in capital and education but less redistributive fiscal systems in the destinations, and rising quantity and complexity in international flows of goods, services, and technology. Labor today remains very far from globalized, with high policy and natural barriers ensuring that 29 of every 30 people live and work in their country of birth.

Discussant(s)
Caroline Freund
,
World Bank and University of California-San Diego
Michela Giorcelli
,
University of California-Los Angeles
Rowena Gray
,
University of California-Merced
JEL Classifications
  • F0 - General