On the evidence of the lively collection of essays at hand, there's nothing dismal about the social science practiced by Stanford University professor Krugman (Peddling Prosperity, 1994, etc.). In a baker's dozen pieces (previously published in Foreign Affairs, Harvard Business Review, and other blue-chip journals), the author gleefully corrects what he construes as major errors corrupting public discourse on the economics of international trade. Using statistical data readily available from US government agencies, Krugman dismisses as ``a dangerous obsession'' the widely accepted notion that countries (like corporations) are in win-lose competition with one another. He goes on to make a persuasive case for the proposition that domestic productivity is the key determinant of growth in employment and living standards throughout a world that is appreciably less interdependent than commonly believed. Among other unfortunate consequences, the author argues, the simplistic doctrine of global rivalry has the power to cloud the minds of appointive and elected officials, who may use it to misallocate resources, impose trade restrictions, or commit other policy blunders. While he characterizes the export/import game's stakes as relatively small, Krugman is at frequent pains to support, if not advance, the free-trade cause. In aid of this objective, he takes on some influential high-profile peers (Paul Kennedy, Edward Luttwak, Robert Reich, et al.) and documents precisely how their anecdotal evidence and figures fail to add up. Covered in equally iconoclastic fashion are NAFTA (a political rather than a commercial alliance, in the author's convincing opinion), the unsustainable gains logged for Asia's newly industrializing nations, and the reality that technology has a greater impact on job rates than trade. An informed and informative audit of the all-too-conventional wisdom that, as per Gresham's law, can drive common sense from the marketplace of ideas. -- Copyright ©1996, Kirkus Associates, LP. All rights reserved.
"Pop internationalists" speak impressively about international trade while ignoring basic economics and misusing economic figures. In this clearly written book, the author of The Age of Diminished Expectations explains what real economic analysis is and discusses economic terms and measurements, such as "value-added" and GDP, giving readera a better understand of how pop internationalists distort, and sometimes contradict, the most basic truths about world trade.
Conventional wisdom holds that foreign competition endangers U.S. jobs, that Americans must learn to compete in an ever-tougher global marketplace and that we can do so only by forging a partnership between government and business. But in Krugman's dissenting view, this consensus is nonsense?"pop internationalism," a set of misleading cliches reinforced by economists and pundits such as Lester Thurow, Robert Reich, Clyde Prestowitz and James Fallows. In these stimulating, maverick essays, reprinted from Foreign Affairs, Scientific American, Harvard Business Review and elsewhere, Stanford economics professor Krugman (The Age of Diminished Expectations) argues that the growth of Americans' real income has slowed almost entirely for domestic reasons. He also defends the North American Free Trade Agreement (NAFTA), deflates the myth of Asia's miraculous economic boom and warns that our obsession with competitiveness distorts U.S. economic policy by encouraging protectionism and trade wars.
Copyright 1996 Reed Business Information, Inc.
Paul Krugman is Professor of Economics at Stanford University.