Is globalization in terminal decline, or will it survive or even thrive in some other form? CTL Director Yossi Sheffi discusses the inequalities, and consequences, that globalization has had on many companies and even nations.
A key rationale for supporting globalization is that it lifts all economic boats... as I argue in my book The New (Ab) Normal: Reshaping Business and Supply Chain Strategy Beyond Covid-19 (MIT CTL Media, 2020), free trade, when done right, can bring both peace and corporate dividends.
However, the version of globalization that has transformed the economic fortunes of many people and countries is not perfect. While it lifted most economic boats, it did not lift all of them. Some workers lost jobs that were outsourced and so globalization also increased inequality within many countries, and notably in the US.
Still, there are good reasons to keep the faith. Companies are still driven by the need to pursue growth opportunities, and global markets remain a top prospect in this regard. And enterprises will not simply abandon the huge investments they have already made in overseas markets.
The challenge is how to develop a version of globalization that mitigates the inequalities within countries that give rise to trade barriers and both intra- and inter-nation tensions.