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A Washington Post Notable Nonfiction Book for 2011 With the British Industrial Revolution, part of the world’s population started to experience extraordinary economic growth—leading to enormous gaps in wealth and living standards between the industrialized West and the rest of the world. This pattern of divergence reversed after World War II, and now we are midway th A Washington Post Notable Nonfiction Book for 2011 With the British Industrial Revolution, part of the world’s population started to experience extraordinary economic growth—leading to enormous gaps in wealth and living standards between the industrialized West and the rest of the world. This pattern of divergence reversed after World War II, and now we are midway through a century of high and accelerating growth in the developing world and a new convergence with the advanced countries—a trend that is set to reshape the world. Michael Spence, winner of the Nobel Prize in Economic Sciences, explains what happened to cause this dramatic shift in the prospects of the five billion people who live in developing countries. The growth rates are extraordinary, and continuing them presents unprecedented challenges in governance, international coordination, and ecological sustainability. The implications for those living in the advanced countries are great but little understood. Spence clearly and boldly describes what’s at stake for all of us as he looks ahead to how the global economy will develop over the next fifty years. The Next Convergence is certain to spark a heated debate how best to move forward in the post-crisis period and reset the balance between national and international economic interests, and short-term fixes and long-term sustainability.


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A Washington Post Notable Nonfiction Book for 2011 With the British Industrial Revolution, part of the world’s population started to experience extraordinary economic growth—leading to enormous gaps in wealth and living standards between the industrialized West and the rest of the world. This pattern of divergence reversed after World War II, and now we are midway th A Washington Post Notable Nonfiction Book for 2011 With the British Industrial Revolution, part of the world’s population started to experience extraordinary economic growth—leading to enormous gaps in wealth and living standards between the industrialized West and the rest of the world. This pattern of divergence reversed after World War II, and now we are midway through a century of high and accelerating growth in the developing world and a new convergence with the advanced countries—a trend that is set to reshape the world. Michael Spence, winner of the Nobel Prize in Economic Sciences, explains what happened to cause this dramatic shift in the prospects of the five billion people who live in developing countries. The growth rates are extraordinary, and continuing them presents unprecedented challenges in governance, international coordination, and ecological sustainability. The implications for those living in the advanced countries are great but little understood. Spence clearly and boldly describes what’s at stake for all of us as he looks ahead to how the global economy will develop over the next fifty years. The Next Convergence is certain to spark a heated debate how best to move forward in the post-crisis period and reset the balance between national and international economic interests, and short-term fixes and long-term sustainability.

30 review for The Next Convergence: The Future of Economic Growth in a Multispeed World

  1. 5 out of 5

    William Mego

    It had 5 stars right up to the end...where it lost one. As a previous update while I was reading it said, it's a brilliant book, and should be considered a must-read for anyone who wants or is going to claim they know what's happening in developing markets, China, India, Africa, currency exchange rates, the EU, etc. You might find yourself looking at the USA national debt differently, as well as the policies and plans (real or perceived) of China in regards to their economy, the so-called artific It had 5 stars right up to the end...where it lost one. As a previous update while I was reading it said, it's a brilliant book, and should be considered a must-read for anyone who wants or is going to claim they know what's happening in developing markets, China, India, Africa, currency exchange rates, the EU, etc. You might find yourself looking at the USA national debt differently, as well as the policies and plans (real or perceived) of China in regards to their economy, the so-called artificial "pegging" of the Yuan to the US Dollar, and their domestic investment policies. So what about that one star? Well, part of the draw of this book is to set awareness and consideration for the changing environmental and energy conditions of the rapidly changing global market against the focus on pure economic growth which pervades all of the thoughts and writings of modern economists. However thoughts on climate change, carbon, and potential energy shortages are dealt with in a fairly offhand and unrealistic manner. He reveals his cards to be merely the same lines we're fed by other economists who's sole focus in life is the eternal pursuit of as large of a growth percentage number as is possible. His only detailed thoughts on any environmental policies consist of advocating carbon credits for the advanced countries and deliberately leaving developing nations out of it, due to the thought that they'll just sell off their credits for huge capital inflows, which while it makes sense, somehow the environmental baby gets lost in a lot of financial bathwater. I personally think the carbon credit system is a band-aid on a festering wound, meaning it provides a mostly cosmetic and political solution without dealing with the actual problem, resulting in the eventual demise of the patient, but even my opinion aside, the scale and timeline of his solutions (I hesitate to even call them that) can be boiled down to: #1: doing mostly nothing for about 20 years. #2: not doing so MUCH damage after about 50 years. A lot of people don't feel that's either realistic or remotely effective. It DOES however make perfect economic sense, and wouldn't effect growth rates in any countries, which I guess is more important to him, and people like him. I'm certainly not amongst that group. Past that, I felt the end of the book dealt with environmental issues as a fantasy of an afterthought, and entirely ignored energy policy. Considering the USA has a proud history of not actually having an energy policy, I guess I shouldn't be surprised. Included at the end of the book is a pointless retelling of the history of the internet which seems to have no place in the book. This book has a great 3 first parts, and the opening bits of the 4th part are good. It's a brilliant book up to that point, but perhaps the author shows his age after that, approaching climate change, potential energy shortages, and future potential of technology in information systems with the jaded eyes of an older man who senses instinctively that whatever events, problems, and solutions will take place with those factors will probably happen after his passing. It's still a book you should read. Hell, if you're involved with finance, investment, economic development, global trade, you MUST read it. If you would actually like to understand how the largely older, wealthy, white, male, euro-USA people who for the most part move the global economic world view environmental policy, which rather than being mustache-twisting fiends looking to destroy the world for the all-mighty dollar are instead well-intentioned but ultimately misguided people looking for the all-mighty dollar for EVERYONE in all nations, you need to read this book. But to speak personally, it's nice to think the entire world could be advanced, educated, and more or less wealthy, but it's also really hard to spend money when you're dead for any number of reasons. I think that perhaps a more drastic solution will be required, and that the future of the world isn't an eternal growth rate driven by the constant "creative destruction" of existing business and consequent rebuilding of the worlds business infrastructure, but instead a constantly shifting world devoted to a new type of economic sustainability, where business and individuals move sideways more often than down, and the market is built less on the destruction of competition, and more on the required agreement of joint operations. The competitive free-market is effective, but as Mr. Spence himself points out, to actually work from the viewpoint of both the economy AND the individual, must be backed up by a massive social safety net which there seems to be a lacking force of capital and political will to re-enforce or create. I feel obligated to point out that a safety net is only required when one is doing something dangerous. Dismiss my thoughts as mindless socialist utopia if you like, but I think that barring a catastrophic environmental event or resource driven collapse of society such as climate change, peak oil, etc., the new concept of "sustainable economics" is an inevitable development, as certain as the sun follows the moon. You're free to bark at the moon if you like, but it won't actually change anything.

  2. 5 out of 5

    Shawn

    This review is being written in the time of impending global economic collapse. Since 2008, an entire generation of news junkies have become armchair economists. I won't be as arrogant as to say that I saw the financial crisis coming with my minor in economics, but the signs were there. An article in Fortune magazine in 2005 theorized about a downward spiral if the housing market collapsed. But the year is 2011. The Eurozone is on the verge of breakup. The US government is on the verge of shutdo This review is being written in the time of impending global economic collapse. Since 2008, an entire generation of news junkies have become armchair economists. I won't be as arrogant as to say that I saw the financial crisis coming with my minor in economics, but the signs were there. An article in Fortune magazine in 2005 theorized about a downward spiral if the housing market collapsed. But the year is 2011. The Eurozone is on the verge of breakup. The US government is on the verge of shutdown and is exceeding one debt limit after the other. There is even talk of state bankruptcy to circumvent pension and health benefit obligations. The Islamic world is on fire for Tunisia to Bahrain. And there is a "occupation" of Wall Street by a rag-tag group of protesters: anti-war activists, anarchists, etc. Revolution is in the air in a time of social media-fueled upheaval and economic despair. I've always felt that the police state has evolved to the point where revolution is possible only in small pockets. Besides, the revolutionaries of 1776 and 1917 didn't have to compete with the NFL or Xbox or Angry Birds for the hearts and minds of the populace. Plus, apathy has been bought by the social benefits card. So we the savers, the productive and the investors are the ones exposed to a marketplace distorted by volatility, speculators and firms that have captured the government watchdogs that are supposed to keep the ship right. Spence has line that made me put things in perspective, that the financial crisis of 2008 IS NOT OVER, that the world is still trying to unravel and understand what happened. An entire bookshelf at the Barnes and Nobles is devoted to books on the 2008 crisis as if it was a one-off anomaly. But the same banks, regulators and dynamics are still there. The "developing world" now has had its faith in Anglo-American, Washington-consensus, IMF/WTO/Basel/OECD/USFR/ECB/BIS system shattered and we are groping around in the dark. Spence's most prominent policy suggestion that has been mirrored in policy journals is a grand bargain with labor unions. This was done by Germany in the last decade, where unions would accept lower or frozen wages in return for job security. This is considered a necessary measure to maintain export competitiveness. I don't think this will ever happen in the US but that's another discussion. I respect the ambition and steadfastness of the Wall Street occupiers even though I do not agree with some of their views. I think a paradigm shift only comes from the inside during a crisis. Some see our two-party system as a strait-jacket and I can respect that view, but both parties have proven to be very malleable. For example, the Great Depression lead the Democrats to co-opt the socialists. The recession of the 1970s lead the Economic Libertarians and Social Conservatives to co-opt the Republican Party. On occasion I watch C-Span's coverage of the House and Senate. I read various Congressional Research Service reports and I also listen Bloomberg radio now and then. It seems to me that politicians speak one language and global finance speaks another language. This book speaks the language of global finance and if people want to change the system, we should be able to engage the system in its native language. Yelling "F**k Bush!" or "F**k Obama!" isn't going to set the course of the system. I recommend this Spence's informative book as a way to become acclimated to the language of monetary and fiscal policy. The subject matter may be a bit steep for those new to economics so I recommend keeping Wikipedia nearby.

  3. 4 out of 5

    Lisa Sansone

    I highly recommend this book.

  4. 4 out of 5

    Arno Mosikyan

    EXCERPTS We shall see (or at least I will argue) that both the high growth and the low growth cannot be explained by strictly economic factors alone. Leadership, politics, governance structures, and the effectiveness of government have crucial parts to play in the drama. Part IV turns to the future and a set of issues, forces, and trends that have to do with whether this pattern of spreading high growth in incomes and wealth can be sustained. There are economic, governance, natural resource, and EXCERPTS We shall see (or at least I will argue) that both the high growth and the low growth cannot be explained by strictly economic factors alone. Leadership, politics, governance structures, and the effectiveness of government have crucial parts to play in the drama. Part IV turns to the future and a set of issues, forces, and trends that have to do with whether this pattern of spreading high growth in incomes and wealth can be sustained. There are economic, governance, natural resource, and environmental braking mechanisms that may slow the process down or cause it to stop altogether. In looking at these, we will encounter a variety of different versions of what are sometimes called “adding-up” problems. Perhaps the availability and cost of energy will cause a slowdown in growth. The increasing interconnectedness in the global economy and financial system is running ahead of the system of governance. Growth rates take some getting used to. There is a rule used by statisticians and economists called the rule of 72. It says that the time it takes in years to double in size at a specific annual growth rate is that growth rate divided into the number 72. It sounds crazy, but it works. So, for example, at 1 percent growth, income (or whatever it is that is growing) doubles in 72 years. Utilizing human resources has turned out to be the basis of Asian growth. And as we shall see later, natural- resource wealth by itself is not the basis of sustained growth. African countries struggled with nation-building and governance, with lots of variation across countries. The continent’s unusually high level of natural-resource wealth proved to be a curse, diverting political incentives toward capturing the wealth or the income streams they generate, and away from broader long-term growth- oriented agendas. Third, sustainable wealth creation is ultimately built on people, human capital and knowledge, on continuous structural change in an economy, and on systems of economic and political organization that permit the productive deployment of those assets. Governance is crucially important. Favorable economic conditions are not enough. Generally, crises are opportunities for change because they weaken vested interests and resistance. The opportunity is not, however, always seized. People will make incredible sacrifices if they believe their children and grandchildren will, as a result, be better off than they are. Most Chinese identify themselves as Han, and that identity has been two thousand years in the making. It is a partially hidden but valuable asset in collective choice and governance. The miracle of India’s democracy since independence in 1950 is that in the presence of extreme diversity in multiple dimensions (religion, class, caste, and language), it has created a sense of pride and national identity that attaches to their noisy, argumentative democratic structure. Technological innovation both creates and destroys value. But when it works, the balance is positive. Much ink has been spilled debating which comes first, institutional development or market dynamics. The right answer is both and neither. There is the celebrated debate between Jeffrey Sachs and William Easterly on whether aid does any good at all or indeed more harm than good. Sachs argues that there is a low-income trap that can be escaped with an appropriate ongoing external investment in the poor countries. Easterly points out that the correlation between aid and outcomes in terms of economic performance is weak at best and that aid creates dependence and undercuts self-reliance and governance reform. Relatively little of the postwar growth we have seen is attributable to foreign aid. An open global trading system and relatively free flows of foreign direct investment and cross-border learning are significantly more important drivers of developing-country growth. There are many critical ingredients that go into high-growth recipes, but the single most important is learning— that is, acquiring new and productively relevant knowledge that already exists. They knew that the economy they were dealing with was changing its characteristics as it grew and developed. Deng famously described this as “crossing the river by feeling the stones.” To summarize briefly, the high-speed growth in the postwar period in the developing world is enabled by knowledge transfer and the reduction in barriers and impediments to the flow of goods, services, and capital in the global economy. The speed is accounted for by the size of the knowledge differential and the rapid transfer of knowledge across borders. What is it about the global economy that makes it possible to grow at previously unknown rates for long periods of time? The short answer is, mainly, two things: (1) a huge potential market and (2) access to knowledge. They are both important and they work together. We have talked about knowledge transfer, so now let’s turn to the market. The main job of government is to facilitate structural change by investing in human capital, protecting people in the transitions through income support and access to basic services, and then to let the market forces and investment incentives work. Governments by and large do not create new products, enterprises, or jobs. They aren’t very good at it. When they do try to organize the productive sector directly, as in various forms of central planning, they fail. What governments do in successful cases of high growth is to create an environment in which private-sector investment is profitable. As the structure evolves, and as firms come and go, people need protection in the form of income and access to basic services during these transitions. Too often the legitimate need for protecting people and families has taken the form of policies designed to protect companies, jobs, and whole industries from competition. Sometimes the competition that is blocked out is domestic and sometimes it is foreign. It is a strategy mistake, albeit an understandable one, to protect people by protecting their jobs. The short version of a better approach is: protect people, not jobs. It is easy to say but harder to do. With the thirteen sustained-high-growth economies as a benchmark, it appears that investment needs to be in excess of 25 percent of total output or GDP. The principal public-sector investments that are needed to support growth are education and infrastructure. Evidence and experience suggest that developing countries are best served by financing most of their investment from domestic savings. Education is an investment that creates public benefits as well as private returns. Normally in most countries it is either subsidized or paid for by government and is an important part of public-sector investment. Urbanization is at the heart of the growth-and-development process. Inclusiveness and Equity Inclusiveness turns out to be an essential part of sustaining growth. “Inclusiveness” in economics is a term that came from India initially but is now used widely. It refers to the distributional aspects of growth. The main ideas are (1) that people should not be left out or excluded from the opportunities created by growth, and (2) there should be limits to the amount of inequality in income and access to basic services that are tolerable. There are two reasons why paying attention to inclusiveness is crucial. Washington Consensus: Original Ten Guidelines 1. Fiscal policy discipline 2. Redirection of public spending from subsidies (“especially indiscriminate subsidies”) toward broad-based provision of key pro-growth, pro- poor services like primary education, primary health care, and infrastructure investment 3. Tax reform— broadening the tax base and adopting moderate marginal tax rates 4. Interest rates that are market determined and positive (but moderate) in real terms 5. Competitive exchange rates 6. Trade liberalization—liberalization of imports, with particular emphasis on elimination of quantitative restrictions (licensing, etc.); any trade protection to be provided by low and relatively uniform tariffs 7. Liberalization of inward foreign direct investment 8. Privatization of state enterprises 9. Deregulation—abolition of regulations that impede market entry or restrict competition, except for those justified on safety, environmental, and consumer-protection grounds and prudent oversight of financial institutions 10. Legal security for property rights As the report of the Commission on Growth and Development (May 2008) said, quoting W. Arthur Lewis, “governments may fail either because they do too little, or because they do too much.” Effective governments and markets are both essential ingredients. There are seventy-eight countries with populations of less than 2 million, and sixty-eight of those have populations of less than a million. While partial political and economic mergers are difficult, they may be the only realistic alternative for countries of this size. Technically this argument about competitiveness is largely incorrect. Late starters can compete, but public- sector investment is required to make them competitive. That investment is lagging in many places. The openness of the global economy should not be taken for granted. Protectionist measures increased as part of the crisis response. While not ideal, this was pretty much inevitable. One can think of it as the political price for aggressive commitment of public resources to shore up the financial sector and to create a fiscal stimulus. Earlier I argued that high levels of savings and investment are a key component of sustained high growth in developing countries. But there is a big difference between high savings to support a program of high investment, on the one hand, and excess savings that go well beyond the investment levels in the economy, on the other. The future of growth in the global economy will be very heavily influenced by the two most populous countries in the world, China and India. Just in terms of construction, the need in each year of the next twenty is roughly equal to the total residential and commercial real estate in Chicago now. This is reminiscent of China, which I have occasionally described as needing to build Los Angeles every year in order to accommodate the flow of 15 million people a year to the cities. The scale is truly hard to comprehend. To explain the history of declining real oil prices up to the mid 1970s, and then again after, up to the price spike in 2007, you have to assume, I think, that there were a long sequence of positive supply surprises. That is, we discovered that we had more oil than we thought. Thoughtful commentators agree that in slowing down or reversing the trends in greenhouse gas emissions, we are “buying insurance” rather than averting a sure thing. But that feature of the challenge makes it much more difficult to address. We just don’t have a lot of practice buying fat-tail insurance on a global basis. But if we are going to do it, we have to do it together. No single nation or small subset can solve the problem. A low-carbon environment is a public good. The United States and Canada emit annually about twenty tons per person at present. The data for a variety of countries are shown in the graph opposite. Other advanced countries are in the range of 6 to 12 tons per person. France, at 6 tons per person, is at the low end because of its extensive use of nuclear power for electricity generation. The global average (4.8 tons) and the safe level (2.3 tons) are also indicated to the left of the graph. Are we on the right course? As Zhou Enlai, the first premier of the People’s Republic of China, said when asked about the impact of the French Revolution, “It is too soon to say.” It is probably fair to say that we are on a steep, long learning curve and have a very substantial distance to go.

  5. 5 out of 5

    Suzanne

    “This book is about the 100-plus years that began in 1945 and will run to the middle of the twenty-first century. Since we are slightly over half-way along, we can think of it as a midterm report.” When I first ran across this book, I was absolutely intrigued. There is hardly an American who does not realize that the third world (especially China and India) are rapidly catching up with the economic strength of the western world. Given the current economic climate, how is this going to affect us “This book is about the 100-plus years that began in 1945 and will run to the middle of the twenty-first century. Since we are slightly over half-way along, we can think of it as a midterm report.” When I first ran across this book, I was absolutely intrigued. There is hardly an American who does not realize that the third world (especially China and India) are rapidly catching up with the economic strength of the western world. Given the current economic climate, how is this going to affect us going forward? Spence lays the groundwork in his impressive work The Next Convergence, explaining how the developing countries have been able to maintain an impressive growth rate (China is as 9.5%!), how they have weathered the Global Financial Crisis, and what is the next step for them and for the already advanced countries. I found this book informative and fascinating, and was especially impressed how this Nobel Laureate author kept it at a level I could understand. I admit, I enjoy the topic of economics and have related college degrees, but most literate persons should be able to understand this book.

  6. 4 out of 5

    Terri-ann White

    Www.uwapress.uwa.edu.au/thenextconver... Www.uwapress.uwa.edu.au/thenextconver...

  7. 4 out of 5

    Susan Chow-Dukhan

    Economic growth was experienced by many countries after the Industrial Revolution. This led to a large gap in living standards between the developed countries and the rest of the world. The countries with low economic growth have been historically referred to as backward countries, underdeveloped countries, Third World countries, less developed countries, developing countries and countries with emerging economies. Our current world economy is resulting in a narrowing of gap between advanced and d Economic growth was experienced by many countries after the Industrial Revolution. This led to a large gap in living standards between the developed countries and the rest of the world. The countries with low economic growth have been historically referred to as backward countries, underdeveloped countries, Third World countries, less developed countries, developing countries and countries with emerging economies. Our current world economy is resulting in a narrowing of gap between advanced and developing countries, as the growth rate in advanced countries is slowing down, with the growth rate in developing countries is increasing annually. The Next Convergence attempts to analyze the reasons why the economic situation is changing. With the exception of the chapters in Part Four: The Future of Growth, the remainder of the book presents a lot of information in a shotgun manner, rather than guiding the reader through related topics. Just as a topic in a chapter starts to engage the reader, we are told that more information will be provided in a future part of the book. When you actually reach the section referred to, the information from the early section of the book is repeated. It was also difficult to study some of the charts and diagrams, as the legend was in various shades of gray.

  8. 4 out of 5

    Chinkal

    Don't pick up this book expecting a drastic change in your opinions, it probably won't even give you any major new perspectives. What this book instead gives you is a collection of well written essays, binded by the theme of economic growth. Delves objectively on the past and present of it and in the last section, covers some of the factors that could be significant in shaping the future of it. Don't pick up this book expecting a drastic change in your opinions, it probably won't even give you any major new perspectives. What this book instead gives you is a collection of well written essays, binded by the theme of economic growth. Delves objectively on the past and present of it and in the last section, covers some of the factors that could be significant in shaping the future of it.

  9. 4 out of 5

    سالم عبدالله

    كتاب في غاية الاهمية ويكفي ان مؤلفه حائز على جائزة نوبل في الاقتصاد في 2001م اسلوب مميز ورائع وترجمة مميزة خفيف و سلس و ذو فائدة

  10. 4 out of 5

    Prateek Maheshwari

    Perhaps I went in with high expectations, but the book under-performed; it felt like a lot of generic thoughts about a range of topics without really getting to the key core questions in-depth..

  11. 5 out of 5

    Timothy Chklovski

    The book reads as an extended conversation with the author. Since a lot of his work has been in microeconomics, he brings a beep appreciation of the micro structure and dynamics of economies to the macro level. The discussion is clear and coherent, without "dumbing down" the topics or the analysis -- although the analysis does stay fairly high-level. A key observation in the book is that some emerging economies are able to enter periods of rapid growth. Against a backdrop of 2-2.5% growth sustaine The book reads as an extended conversation with the author. Since a lot of his work has been in microeconomics, he brings a beep appreciation of the micro structure and dynamics of economies to the macro level. The discussion is clear and coherent, without "dumbing down" the topics or the analysis -- although the analysis does stay fairly high-level. A key observation in the book is that some emerging economies are able to enter periods of rapid growth. Against a backdrop of 2-2.5% growth sustained for 250 years by what have become the developed economies, the emerging economies economies tend to grow at 6.5 -10% annual rates, for stretches of 25 years or more. This includes not only asian countries, but also Brazil and Botswana. An interesting question is why do the advanced economies not grow faster or slower? After all, sustaining roughly constant growth of 2-2.5% through gigantic shifts in importance of various sectors, shifts in demographics and transportation costs is nothing short of remarkable. The unexpected and extremely rapid growth of emerging economies is somewhat explained as catch-up growth, with expansion supported by the advanced economies -- through everything from management practices, advanced technology, and, perhaps most importantly, as large market demand. The author stresses the pattern that supports such a growth requires continued large infrastructure investment, and is helped by willingness to defer spending despite low incomes. The book increased my appreciation for national development agendas -- for instance, how a country such as China might go about thinking of transitioning to higher-tech economy, by subsidizing development of domestic high tech industries such as auto manufacturing. Tied with the green agenda and its focus on training and employing highly educated workers, a Chinese company such as BYD becomes structurally important to China and its overall plan for economic development. Also useful, to me were ideas that China's emergence as a middle income economy can create truly large demand from countries still earlier in their economic development. How labor intensive industries will fare against increasing automation -- both in terms of factory workers vs robots and call center workers vs. IBM Watson and deep learning -- we will have to see. There are many more specific observations that help one think about large trends over the coming decades -- for instance, developed economies are increasingly doubling down on knowledge work as key driver of their economies. But, knowledge work is a highly tradeable good -- the improved algorithms, data analysis etc etc can relatively easily be carries out in China as in the US. So, advanced economies are effectively relying on something that is highly movable around the world. An engineer (of whatever citizenship) living in India or Thailand can have comparable impact to one living in California, at a fraction of the cost of living -- and that gap is unlikely to close anytime soon. Th book also looks into how world economies handle shocks -- part 3 is focused on how the 2008-2009 crisis played out around the world. What was interesting to me here is similarities of how countries and companies might react to a crisis. Of note was the breakdown of global agenda, with economies understandably focused on their short-term stabilization, for example export restrictions on rice from India and Thailand. Also in similarity to company-level developments -- where a company may need to reorient itself drastically as it proceeds from selling to early adopters based on new capabilities to selling to adoption laggards based on support and stability, so a developing economy may need to dramatically reorient itself from labor intensive industries that can pull it to middle-income range (around 10k per capita), to more knowledge oriented industries and high end manufacturing of developed economies. The author further talks about challenges of small countries in attracting interest and thus funding from multinationals to its markets (Singapore's singular achievement being all the more startling), and about the curse of what would seem to be a blessing of having rich natural resources. Natural resources tend to both corrupt the government, making investment into people and infrastructure less appealing vs the lure of simply exploiting and appropriating the profits of natural resources. Natural resources can also render other exports of the economy uncompetitive, presenting development challenges. Agin, interestingly, parallels to companies hamstrung and ultimately undone by having an aging cash cow business are striking. In all, an illuminating read. Like a fire casting its light in many directions, I suspect another person with different interests will find this book equally illuminating of the issues they have the keenest interest in.

  12. 4 out of 5

    Marks54

    This is a good book about economic growth in the current lousy global economic environment. The premise is that world is changing from the one following the industrial revolution in the West, in which the industrialized nations grew more rapidly than the rest of the world, creating a gap in wealth, standard of living, life prospects, health, etc. between the industrialized nations and the rest of the world. What is the change? Well it is that since about 1945, a group of rapidly industrializing This is a good book about economic growth in the current lousy global economic environment. The premise is that world is changing from the one following the industrial revolution in the West, in which the industrialized nations grew more rapidly than the rest of the world, creating a gap in wealth, standard of living, life prospects, health, etc. between the industrialized nations and the rest of the world. What is the change? Well it is that since about 1945, a group of rapidly industrializing nations, mostly in Asia, but including Brasil and others, are growing much more rapidly than the west and will shortly pull equal to and in some cases surpass the economic performance of the western industrialized nations. They are doing this by growing much more rapidly than the industrialized nations did in their prime. The agenda of the book is to discuss how this coincidence of a) more of the world being industrialized; and b) some parts of the industrialized world developing more rapidly than other parts will shape economic life in the next century and beyond. The author is a Nobel Prize winning economist and former Dean of Stanford's business school. That the book should be of high intellectual quality and very informative should not therefore be surprising. What is surprising is that the book is exceptionally clear and easy to read. The chapters are short, the prose is clear and even punchy, the thoughts jump out at you. Even specialists will find some new points here, but most will find this an entertaining tour of material that is hard to access in its original journal articles. It is one of the best overviews of current economic crises that I have encountered.

  13. 5 out of 5

    Ray

    Reserving the edit-option, my tentative evaluation that this book is in the long line of contemporary political economy (the line of which Galbraith's The Affluent Society was a noteworthy failed success) that cries for intelligent study. Content, as far as I have yet gone, is unusually cogent despite flights of prolix wandering--an illustration early in the book is a sentence 64 (yes, it was such meandering that after muttering "what-in-hell did he say" I actually counted the words in disbelief Reserving the edit-option, my tentative evaluation that this book is in the long line of contemporary political economy (the line of which Galbraith's The Affluent Society was a noteworthy failed success) that cries for intelligent study. Content, as far as I have yet gone, is unusually cogent despite flights of prolix wandering--an illustration early in the book is a sentence 64 (yes, it was such meandering that after muttering "what-in-hell did he say" I actually counted the words in disbelief)--this book promises to be a sensible, non-mathematical, and comprehensive examination of hones-to-god real life issues of political economy. Further reading may lead me to modify my opinions and rating but for now it just edges Rajan's Fatal Flaws as pioneering popularizing. Further reading convinced me that I'd say it joins a great list of contemporary writing that doesn't add much to our knowledge. It does, however, make us aware that the "BRIC" nations are important and increasingly significant in an interrelated world.

  14. 5 out of 5

    Steven

    The book reads as a post-retirement sendoff with numerous disconnected parts. I would agree Michael Spence, the author, is intelligent and bipartisan; however, he fails to answer the essential question lurking in the background: Why should Americans subsidize the growth and development in China and the rest of the developing world at the cost of high joblessness and underemployment in the States in the name of openness and free trade? Also: Will the G20, or some other global government body, hel The book reads as a post-retirement sendoff with numerous disconnected parts. I would agree Michael Spence, the author, is intelligent and bipartisan; however, he fails to answer the essential question lurking in the background: Why should Americans subsidize the growth and development in China and the rest of the developing world at the cost of high joblessness and underemployment in the States in the name of openness and free trade? Also: Will the G20, or some other global government body, help or hinder the performance of American businesses and capitalists if we give the body more leeway on solving key economic questions facing America, the world?

  15. 5 out of 5

    ferhat

    A good high level look into growth in the post-crisis world in terms of climate, energy, technology and (imbalanced) distribution in between developing and developed economies. I have learnt a good deal from it; i.e adding-up problem, structural change (I would call it disturbance), necessity of flexible rules-based conventions, discrepancy between domestic and global goals, etc. After some time, it became a bit too repetitive but it could be a nice complement of a package of books that would hel A good high level look into growth in the post-crisis world in terms of climate, energy, technology and (imbalanced) distribution in between developing and developed economies. I have learnt a good deal from it; i.e adding-up problem, structural change (I would call it disturbance), necessity of flexible rules-based conventions, discrepancy between domestic and global goals, etc. After some time, it became a bit too repetitive but it could be a nice complement of a package of books that would help to understand (current) world.

  16. 4 out of 5

    Craig Werner

    Spence is optimistic about the future of the global economy, predicting a narrowing of the gap between wealthy and developing nations. He didn't convince me. The primary reason is that his extrapolations are based on the premise of continued growth, which is almost impossible to envision without cataclysmic environmental consequences. Spence gives lip service to the issue, but never really engages it, falling back on expectations of greater cooperation and technological development. I hope he's ri Spence is optimistic about the future of the global economy, predicting a narrowing of the gap between wealthy and developing nations. He didn't convince me. The primary reason is that his extrapolations are based on the premise of continued growth, which is almost impossible to envision without cataclysmic environmental consequences. Spence gives lip service to the issue, but never really engages it, falling back on expectations of greater cooperation and technological development. I hope he's right, but I doubt it.

  17. 5 out of 5

    Harold

    This book started as an excellent summary and explanation of economic growth and development in the world today, but as progressed it got away from me. I think that is probably my fault, rather than the books'. I read it in Hawaii over Xmas vacation and it certainly isn't a beach read. The deeper in I got, the deeper it got, and the shallower I got. Nonetheless, even with my somewhat limited (and sunburned) vision, there was plenty here to learn from, and to think about. I just think I missed mo This book started as an excellent summary and explanation of economic growth and development in the world today, but as progressed it got away from me. I think that is probably my fault, rather than the books'. I read it in Hawaii over Xmas vacation and it certainly isn't a beach read. The deeper in I got, the deeper it got, and the shallower I got. Nonetheless, even with my somewhat limited (and sunburned) vision, there was plenty here to learn from, and to think about. I just think I missed more than I got. Read it is a snowstorm.

  18. 5 out of 5

    Richard Bravman

    A comprehensive (to a fault) and thoughtful analysis of the macroeconomic factors shaping the development trajectory of the global economy and all those who participate in it. The author makes a compelling argument for the need for developed countries to both accept a rapidly narrowing gap between their wealth and influence and that of the emerging powers, and to adopt new policies, in both public and private sectors, aimed at creating a sustainable foundation for long term growth. A very worthw A comprehensive (to a fault) and thoughtful analysis of the macroeconomic factors shaping the development trajectory of the global economy and all those who participate in it. The author makes a compelling argument for the need for developed countries to both accept a rapidly narrowing gap between their wealth and influence and that of the emerging powers, and to adopt new policies, in both public and private sectors, aimed at creating a sustainable foundation for long term growth. A very worthwhile, if a bit dense at times, read. Recommended.

  19. 4 out of 5

    Josh Gatlin

    Extremely interesting book that puts the effect the information age is and will increasingly have on the rest of the world's ability to compete and catch up with more advanced countries. Has great insight into the positives of globalization going forward, the disappearance of many competitive advantages, and what countries have to do to continue collective success going forward. Extremely interesting book that puts the effect the information age is and will increasingly have on the rest of the world's ability to compete and catch up with more advanced countries. Has great insight into the positives of globalization going forward, the disappearance of many competitive advantages, and what countries have to do to continue collective success going forward.

  20. 5 out of 5

    Patrdr

    This is a well argued analysis of the big trends in the global economy. It offers valuable guidance for economic policy in both the 'advanced' and emerging world. It does not gloss over the difficulties but is at its core optimistic that we can experiment our way to acceptable and durable solutions. This is a well argued analysis of the big trends in the global economy. It offers valuable guidance for economic policy in both the 'advanced' and emerging world. It does not gloss over the difficulties but is at its core optimistic that we can experiment our way to acceptable and durable solutions.

  21. 4 out of 5

    Luaba

    It's a smart sensible tour d'horizon of the global economy from one of the best and unbias economist in the world. A great read for anyone interested in the current global economy especially those who think that the US can afford to default smh. It's a smart sensible tour d'horizon of the global economy from one of the best and unbias economist in the world. A great read for anyone interested in the current global economy especially those who think that the US can afford to default smh.

  22. 5 out of 5

    Aaron Terrazas

    Excellent overview of the global economy and the major historical trends/current issues. However, if you regularly follow the economic news (e.g., The Economist), and IMF/World Bank publications, there is really nothing new here.

  23. 5 out of 5

    Ryan

    This was a decent read--especially for someone interested in globalization and macroeconomic issues. At times, the book was too technical and slow. With that said, it was still worth the read.

  24. 4 out of 5

    Samapika

    nice read .... even a person without having a economics background, can easily understand ...

  25. 5 out of 5

    Colin

  26. 4 out of 5

    Conor Mullally

  27. 4 out of 5

    Himanshu

  28. 5 out of 5

    Brenda Vinall-Mogel

  29. 4 out of 5

    Ruczak Jain

  30. 4 out of 5

    Mohamed

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