Through a number of studies, events, and videos, our project has tried to shed light on the evolving nature of globalization. In our “Roadmap 2030” we provide a concise overview of the main findings and its implications for Germany.
Win-win, Not Zero-sum
Boiled down to one sentence, our key message is: Globalization is a win-win, and not a zero-sum game. The global integration of markets increases economic growth, including growth that is generated by the real gross domestic product (GDP) of all countries involved. Our Globalization report shows that advancing globalization has increased real GDP per capita in all 42 industrialized and emerging countries surveyed. Simulations of further steps toward integration of markets via free trade agreements (FTA), such as a Europa-Japan FTA, also yield positive results.
Protectionism Spells Danger
Conversely, measures to roll back globalization and regional integration come at a sizeable cost for all parties involved. We have analyzed a number of examples and potential causes for such setbacks, such as the economic reintroduction of border controls the withdrawal of the United Kingdom from the European Union and the increase of protectionist trade policies. The rupture of established value chains and forgoing international division of labor yields negative welfare effects for both companies and consumers. So, the international trend toward protectionism is cause for great concern.
You might also be interested in our new Roadmap Post: Roadmap 2030: Five ways in which Europe could respond to growing protectionism
5 Areas of Action
In order to prevent further escalation toward disintegration and to better reap the gains from globalization in an inclusive and sustainable way, we have devised a number of recommendations on how to move ahead. Our Roadmap 2030 identifies five areas where action is particularly warranted and actually crucial for Germany:
1) Responding appropriately to rising protectionism;
2) Reducing the German export surplus;
3) Improve framework-conditions for welfare enhancing free trade;
4) Spread globalization gains in Germany more widely;
5) Better prepare Germany as a business location for future challenges.
Over the course of the next weeks, we will present the recommendations in one blog post for each area. Stay tuned!