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“Joseph E. Stiglitz, 2001 Nobel Memorial laureate in economics, is already well known for his critique of the current economic policies which shape the development of globalization. In 2002, Stiglitz published Globalization and its Discontents and shifted much of the blame for the “wrong-doing” committed by globalization on such institutions as the International Monetary Fund (IMF), World Bank and World Trade Organization (WTO). Four years after publishing this work, Stiglitz recompiled his opinions in a new volume, Making Globalization Work. Here, he expounded his opinions on the limitation of capitalism, the political corruption present in international monetary institutions (such as the aforementioned three) and how the First World has consistently maneuvered the market to the disadvantage of developing countries. His arguments contain much merit and should be considered. Unfortunately, Stiglitz uses the book as a platform to attack pro-market economists without reconciling the fact that such classical economists such as Adam Smith had already shattered the myth that government policy represents capitalism.
The first three chapters of Making Globalization Work are spent lambasting capitalism, liberalization and free trade for their handiwork in keeping the Third World from developing into the First World. He actually does little in outlying his own solutions, and instead uses the first part of the book to shape the reader’s opinion on existing economic policies and then organizing these policies under the common title of “capitalism”. From the very beginning, Joseph Stiglitz proves to be intellectually dishonest, or at least he himself misguided on what capitalism really is and what pro-market economists truly support. He, of course, is correct when putting much of the blame of current world poverty on such institutions as the IMF and WTO, but these are not capitalist institutions. Let us not forget that they came into existence through the legislation of international government, and they operate with the authority of the State. There is nothing remotely capitalistic in any world trade organization or association, for the simple fact that without governmental support they probably would simply cease to exist. In any case, it seems astonishing that Joseph Stiglitz is surprised that these institutions are ripe with corruption—any institution run by politicians and government bureaucrats is bound to be corrupted, as it is within the nature of bureaucracy.
To give a full critique of Making Globalization Work within the confines of a short article is unrealistic. The errors made by Stiglitz deserve a book. Many of the mistakes made are elementary and careless, which is astounding given that it was a Nobel laureate which authored the book. This review will focus on two major inaccuracies. The two erroneous arguments covered are Stiglitz’ views on wages in a “globalized economy” and his extremely erred opinions on liberalizations and the effects of. To be fair to Stiglitz, one should also cover his arguments on patents, which at first seems like the most legitimate of all the cases he makes within the covers of Making Globalization Work. Unfortunately, even after analyzing these three positions, this review falls extraordinarily short on offering a complete critique of the book; at least, in the sense that it does not begin to scratch the surface of all of the mistakes committed.
Please continue to read here: http://www.economicthought.net/2009/11/how-not-to-make-globalization-work”