RETHINKING GLOBAL RESILIENCE

The pandemic is straining economic and social fault lines: the only remedy is international cooperation

An infected passenger flies from Wuhan to Milan, a computer virus invades an internet connection, subprime defaults in the US Midwest trigger a global economic crisis. The super-spreaders of the goods of globalization—airport hubs, fiber-optic cables, global financial centers—are also the super-spreaders of the bads. This is the “butterfly defect” of globalization, the systemic risk endemic to our hyperconnected world, in which small actions in one place can spread rapidly to have global effects.

My book The Butterfly Defect shows why globalization creates systemic risks. It also shows why stopping globalization will not stop global threats but rather will amplify them. There is no wall high enough to keep out climate change, pandemics, and other catastrophic risks. But high walls undermine the potential for cooperation required to manage our shared risks. Protectionism reduces investment, trade, tourism, and technological advances, which create jobs and higher incomes, reducing the capacity of countries to build resilience. The solution is in working together to make globalization safe and sustainable, not in working against each other.

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Πηγή: imf.org