Mark Twain is reputed to have remarked that history does not repeat itself, but it often rhymes. While the Global Financial Crisis of 2008–2009 was not a catastrophe on the order of World War I, there is a broad similarity in the sequelae to both of these events—a failed attempt to return to pre-trauma normalcy, followed by a process of international economic disintegration in the face of changed geopolitical realities. In this essay, I explore three questions that this similarity raises. Does globalization inherently foster domestic or international dynamics that eventually lead to political backlash? If so, are these dynamics inevitable, or can complementary economic policies nurture a stable globalization? And finally, since policies are endogenous, when are policy approaches and institutions that complement and support globalization likely to arise?
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I use this phrase in a somewhat different sense than Romer (1994) did.
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I thank Marion Fourcade for helpful suggestions.
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This paper draws on Obstfeld (2019).
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Obstfeld, M. Globalization Cycles. Ital Econ J 6, 1–12 (2020). https://doi.org/10.1007/s40797-020-00121-4