{"id":1800,"date":"2022-04-01T12:13:09","date_gmt":"2022-04-01T16:13:09","guid":{"rendered":"https:\/\/americancompass.beckandstone.com\/did-globalization-cause-the-great-stagnation\/"},"modified":"2022-11-07T15:01:21","modified_gmt":"2022-11-07T20:01:21","slug":"did-globalization-cause-the-great-stagnation","status":"publish","type":"post","link":"https:\/\/americancompass.org\/did-globalization-cause-the-great-stagnation\/","title":{"rendered":"Did Globalization Cause the Great Stagnation?"},"content":{"rendered":"\n

Analyzing the effects of any long-run macroeconomic trend is admittedly a difficult affair. After all, typically more than one big trend is happening at a time, which means that isolating the impact of any particular force requires careful and thoughtful empirical analysis. It is somewhat troubling then, that \u201cWhere\u2019s the Growth?<\/a>\u201d doesn\u2019t appear to draw any clear causation between the alleged malign forces of globalization and the declines in productivity and economic dynamism.<\/p>\n\n\n\n

Put more straightforwardly, it is true that American productivity growth and economic dynamism has been on the decline for decades. But these are much broader trends that reams of empirical work have connected to self-imposed housing scarcity<\/a>, demographic headwinds<\/a>, an overbearing regulatory<\/a> environment<\/a>, a general societal decadence<\/a>, and the slow process of new ideas getting harder to find<\/a>. Given what we know about these other factors, do we have strong evidence to suggest that globalization played a large (if any) role in the Great Stagnation?<\/p>\n\n\n\n

It\u2019s possible that, absent globalization, many of the same trends would have been worse\u2014the fact that the U.S. manufacturing sector appears to have been made worse off<\/a> by the Trump Administration\u2019s tariffs andtrade wars is certainly revealing.<\/p>\n\n\n\n

Beyond the general slowdown in science and technology, let\u2019s take a few of the key charts from \u201cWhere\u2019s the Growth?<\/a>\u201d and examine the more complicated macro stories that may be hiding underneath.<\/p>\n\n\n\n