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Being Charged by an Elephant: A story of globalization and inequality

Published on April 19, 2017        Author: 

Along with many economists and globalization scholars, my favorite graph these days is the elephant graph. Named for its distinctive elephant-shaped curve (see below), this graph shows the rise in real incomes for people in different income brackets throughout the world over a twenty year period of intense economic globalization (1998 to 2008). Economists often like to tell us that free trade is good because it is a rising tide that lifts all boats. What this graph suggests, however, is that economic globalization has produced clear winners and clear losers. This division seems to be playing an important role in explaining some of the rising nationalist and pro-protectionist sentiments we are witnessing in certain developed states, as shown by the rise of Trump and the vote for Brexit.

So who has won and lost in the age of economic globalization? Read the rest of this entry…