Even in a Digital World, Globalization Is Not Inevitable

Pankaj Ghemawat
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At the level of public policy, globaloney breeds complacency, even in such dangerous times.
By Pankaj Ghemawat
In the aftermath of the UK’s Brexit vote and Donald Trump’s election in the U.S., globalization is seen as a political hot potato rather than a hot ticket to prosperity. This populist backlash reminds us that the rewards of globalization are not evenly distributed, and as a result there has been some questioning of the idea that borders should be open to trade — as well as concerns about what might happen instead. In the week since Trump was elected, the number of Google searches for “trade war” has jumped sevenfold and continues to climb.

Despite this shift, a significant number of experts continue to believe in the virtually unlimited potential of globalization. Most of them focus on digitalization specifically and on communications technology, though some attention continues to be paid to transportation infrastructure (e.g., Parag Khanna’s Connectography).

I like to refer to such exaggerated perceptions of globalization as “globaloney,” a term coined in the 1940s by Clare Boothe Luce. Thomas Friedman’s famous proposal that, thanks to the internet, the “world is flat” (advanced in a 2005 book bearing that title) articulates this idea in a way that is clear and simple — and wrong.

Read the full article in Harvard Business Review.

Pankaj Ghemawat is a Global Professor of Management and Strategy and Director of the Center for the Globalization of Education and Management.