That is my latest Bloomberg column, and it address the common charge that globalization is over or has peaked. Global trade has in fact slowed down a great deal. But we are seeing a new kind of globalization, only inside the borders of the larger emerging economies, which often are not yet mature nation-states with complete economic integration. Here is one excerpt:
India also is seeing its different states and regions being tied together through migration, trade, and investment. You can see this in the food: tandoori chicken and dosas have become national standards, available throughout the country, and less closely associated with their particular regions of origin. Hindi is becoming more of a national lingua franca, and the Internet makes it possible to broadcast the same messages to the entire country at relatively low cost. Many these “globalizing” developments have spread expertise and capital from the more developed southern and western parts of India to the poorer eastern and landlocked regions. Labor, in turn, has migrated from the poorer states to the wealthier cities.
Significant barriers remain; for example, Indian trucks must pass through numerous checkpoints to carry goods around the country. Logistics costs remain high, at about 13 percent of gross domestic product. Fortunately, the recent move to a national goods-and-services tax will lower some of the state-level taxes on internal trade. Keep in mind that India’s most populous states would be among the larger nations in the world. So if Uttar Pradesh (over 200 million people) and Bihar (over 100 million people) have closer economic relations, it is a major advance in trade relations and resembles globalization in its economic consequences.
Here is the close:
But a lot of today’s globalization-by-any-other-name is, counterintuitively, taking the form of nation-building. And just as we got both good and bad sides of globalization, so will this process of nation-building be a mixed bag. It may, for example, sometimes include too much nationalism. Nonetheless, these stronger and better integrated political units probably will grow in wealth and economic sophistication, and in due time that will give us more globalization yet.
Much of the piece deals with China, do read the whole thing.