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At least some of the frustration attributed to globalization is resentment at a loss of status

Even though it has long been well-established in both economic theory and in the data that the gains from trade liberalization are not equally distributed across the population and that there are many people who end up worse off, economists have nonetheless discounted these concerns in their enthusiasm for a world with increased international flows of goods, capital and people. According to Rodrik, “economists’ failure to provide the full picture on trade, with all of the necessary distinctions and caveats, has made it easier to tar trade, often wrongly, with all sorts of ill effects.”

There’s something to this. Perhaps some of the blame should be deflected to the he said, she said narratives that dominate media coverage of economics: supporters of liberalized trade present the case for, and opponents present the case against. There’s not much room for people who acknowledge the many risks and who still conclude that, on the whole, the benefits outweigh the costs.

And it should be stressed: by all but the most narrow criteria, the benefits of globalization far outweigh the costs. Thirty years ago, the distribution of world income was sharply polarized, with two distinct groups: a large group of people with low incomes, and a smaller number of people with higher incomes. When graphed, these groups formed two distinct peaks in the global income distribution. The integration of China and other low-income countries into the international economy has lifted hundreds of millions of people out of poverty, reducing inequality and creating a global middle class: the distribution of world income now has a single peak.