In the wake of the financial crisis and the Great Recession, economics seems anything but a science. In this sharp, masterfully argued book, Dani Rodrik, a leading critic from within, takes a close look at economics to examine when it falls short and when it works, to give a surprisingly upbeat account of the discipline. Drawing on the history of the field and his deep experience as a practitioner, Rodrik argues that economics can be a powerful tool that improves the world-but only when economists abandon universal theories and focus on getting the context right. Economics Rules argues that the discipline's much-derided mathematical models are its true strength. Models are the tools that make economics a science. Too often, however, economists mistake a model for the model that applies everywhere and at all times. In six chapters that trace his discipline from Adam Smith to present-day work on globalization, Rodrik shows how diverse situations call for different models. Each model tells a partial story about how the world works. These stories offer wide-ranging, and sometimes contradictory, lessons-just as children's fables offer diverse morals. Whether the question concerns the rise of global inequality, the consequences of free trade, or the value of deficit spending, Rodrik explains how using the right models can deliver valuable new insights about social reality and public policy. Beyond the science, economics requires the craft to apply suitable models to the context. The 2008 collapse of Lehman Brothers challenged many economists' deepest assumptions about free markets. Rodrik reveals that economists' model toolkit is much richer than these free-market models. With pragmatic model selection, economists can develop successful antipoverty programs in Mexico, growth strategies in Africa, and intelligent remedies for domestic inequality. At once a forceful critique and defense of the discipline, Economics Rules charts a path toward a more humble but more effective science.

Policy makers in the developing world are grappling with new dilemmas created by openness to trade and capital flows. What role, if any, remains for the state in promoting industrialization? Does openness worsen inequality, and if so, what can be done about it? What is the best way to handle turbulence from the world economy, especially the fickleness of international capital flows?

In "The New Global Economy and Developing Countries" Dani Rodrik argues that successful integration into the world economy requires a complementary set of policies and institutions at home. Policy makers must reinforce their external strategy of liberalization with an internal strategy that gives the state substantial responsibility in building physical and human capital and mediating social conflicts.

An honest discussion of free trade and how nations can sensibly chart a path forward in today's global economyNot so long ago the nation-state seemed to be on its deathbed, condemned to irrelevance by the forces of globalization and technology. Now it is back with a vengeance, propelled by a groundswell of populists around the world. In Straight Talk on Trade, Dani Rodrik, an early and outspoken critic of economic globalization taken too far, goes beyond the populist backlash and offers a more reasoned explanation for why our elites' and technocrats' obsession with hyper-globalization made it more difficult for nations to achieve legitimate economic and social objectives at home: economic prosperity, financial stability, and equity.Rodrik takes globalization's cheerleaders to task, not for emphasizing economics over other values, but for practicing bad economics and ignoring the discipline's own nuances that should have called for caution. He makes a case for a pluralist world economy where nation-states retain sufficient autonomy to fashion their own social contracts and develop economic strategies tailored to their needs. Rather than calling for closed borders or defending protectionists, Rodrik shows how we can restore a sensible balance between national and global governance. Ranging over the recent experiences of advanced countries, the eurozone, and developing nations, Rodrik charts a way forward with new ideas about how to reconcile today's inequitable economic and technological trends with liberal democracy and social inclusion.Deftly navigating the tensions among globalization, national sovereignty, and democracy, Straight Talk on Trade presents an indispensable commentary on today's world economy and its dilemmas, and offers a visionary framework at a critical time when we need it most.

The economics profession has become a favourite punching bag in the aftermath of the global financial crisis. Economists are widely reviled and their influence derided by the general public. Yet their services have never been in greater demand. To unravel the paradox, we need to understand both the strengths and weaknesses of economics. Dani Rodrik argues that the multiplicity of theoretical frameworks - what economists call 'models' that exist side by side is economics' great strength. Economists are trained to hold diverse, possibly contradictory models of the world in their minds. This is what allows them, when they do their job right, to comprehend the world, make useful suggestions for improving it, and to advance their stock of knowledge over time. In short, it is what makes economics a 'science' a different kind of science from physics or some other natural sciences, but a science nonetheless. But syncretism is not a comfortable state of mind, and economists often jettison it for misplaced confidence and arrogance, especially when they confront questions of public policy. Economists are prone to fads and fashions, and behave too often as if their discipline is about the search for the model that works always and everywhere, rather than a portfolio of models. Their training lets them down when it comes to navigating among diverse models and figuring out which one applies where. Ideology and political preferences frequently substitute for analysis in choosing among models. So the book offers both a defence and critique of economics. Economists' way of thinking about social phenomena has great advantages. But the flexible, contextual nature of economics is also its Achilles' heel in the hands of clumsy practitioners.

In this eloquent challenge to the reigning wisdom on globalization, Dani Rodrik reminds us of the importance of the nation-state, arguing forcefully that when the social arrangements of democracies inevitably clash with the international demands of globalization, national priorities should take precedence. Combining history with insight, humor with good-natured critique, Rodrik s case for a customizable globalization supported by a light frame of international rules shows the way to a balanced prosperity as we confront today s global challenges in trade, finance, and labor markets."

An honest discussion of free trade and how nations can sensibly chart a path forward in today's global economy Not so long ago the nation-state seemed to be on its deathbed, condemned to irrelevance by the forces of globalization and technology. Now it is back with a vengeance, propelled by a groundswell of populists around the world. In Straight Talk on Trade, Dani Rodrik, an early and outspoken critic of economic globalization taken too far, goes beyond the populist backlash and offers a more reasoned explanation for why our elites' and technocrats' obsession with hyper-globalization made it more difficult for nations to achieve legitimate economic and social objectives at home. Ranging over the recent experiences of advanced countries, the eurozone, and developing nations, Straight Talk on Trade charts a way forward with new ideas about how to reconcile today's inequitable trends with liberal democracy and social inclusion.

In "One Economics, Many Recipes," leading economist Dani Rodrik argues that neither globalizers nor antiglobalizers have got it right. While economic globalization can be a boon for countries that are trying to dig out of poverty, success usually requires following policies that are tailored to local economic and political realities rather than obeying the dictates of the international globalization establishment. A definitive statement of Rodrik's original and influential perspective on economic growth and globalization, "One Economics, Many Recipes" shows how successful countries craft their own unique strategies--and what other countries can learn from them.

To most proglobalizers, globalization is a source of economic salvation for developing nations, and to fully benefit from it nations must follow a universal set of rules designed by organizations such as the World Bank, the International Monetary Fund, and the World Trade Organization and enforced by international investors and capital markets. But to most antiglobalizers, such global rules spell nothing but trouble, and the more poor nations shield themselves from them, the better off they are. Rodrik rejects the simplifications of both sides, showing that poor countries get rich not by copying what Washington technocrats preach or what others have done, but by overcoming their own highly specific constraints. And, far from conflicting with economic science, this is exactly what good economics teaches.

For a century, economists have driven forward the cause of globalization in financial institutions, labour markets, and trade. Yet there have been consistent warning signs that a global economy and free trade might not always be advantageous. Where are the pressure points? What could be done about them? Dani Rodrik examines the back-story from its seventeenth-century origins through the milestones of the gold standard, the Bretton Woods Agreement, and the Washington Consensus, to the present day. Although economic globalization has enabled unprecedented levels of prosperity in advanced countries and has been a boon to hundreds of millions of poor workers in China and elsewhere in Asia, it is a concept that rests on shaky pillars, he contends. Its long-term sustainability is not a given. The heart of Rodrik's argument is a fundamental 'trilemma': that we cannot simultaneously pursue democracy, national self-determination, and economic globalization. Give too much power to governments, and you have protectionism. Give markets too much freedom, and you have an unstable world economy with little social and political support from those it is supposed to help. Rodrik argues for smart globalization, not maximum globalization.

What guidance does academic research really provide to economic policy development? The critical and analytical surveys in this volume investigate links between policies and outcomes by surveying work from broad macroeconomic policies to interventions in microfinance. Asserting that there are no universal correspondences between policies and outcomes, contributors demonstrate instead that only an intense familiarity with the development context and the universe of applicable economic models can generate successful policies. Getting cause-and-effect right is essential for policy design and implementation. With the goal of drawing researchers and policy makers closer, this volume highlights our increasing understanding of ways to combine economic theorizing with careful, thoughtful empirical work.
* Presents an accurate, self-contained survey of the current state of the field
* Summarizes the most recent discussions, and elucidates new developments
* Although original material is also included, the main aim is the provision of comprehensive and accessible surveys

The economics of growth has come a long way since it regained center stage for economists in the mid-1980s. Here for the first time is a series of country studies guided by that research. The thirteen essays, by leading economists, shed light on some of the most important growth puzzles of our time. How did China grow so rapidly despite the absence of full-fledged private property rights? What happened in India after the early 1980s to more than double its growth rate? How did Botswana and Mauritius avoid the problems that other countries in sub--Saharan Africa succumbed to? How did Indonesia manage to grow over three decades despite weak institutions and distorted microeconomic policies and why did it suffer such a collapse after 1997?

What emerges from this collective effort is a deeper understanding of the centrality of institutions. Economies that have performed well over the long term owe their success not to geography or trade, but to institutions that have generated market-oriented incentives, protected property rights, and enabled stability. However, these narratives warn against a cookie-cutter approach to institution building.

The contributors are Daron Acemoglu, Maite Careaga, Gregory Clark, J. Bradford DeLong, Georges de Menil, William Easterly, Ricardo Hausmann, Simon Johnson, Daniel Kaufmann, Massimo Mastruzzi, Ian W. McLean, Lant Pritchett, Yingyi Qian, James A. Robinson, Devesh Roy, Arvind Subramanian, Alan M. Taylor, Jonathan Temple, Barry R. Weingast, Susan Wolcott, and Diego Zavaleta.

Turkey stands at a crossroad after a decade of adjustment to its severe debt crisis in the late 1970s. This volume brings together a group of contributors who discuss the consequences of this transition and the likely pains for the future.

Leading economists and policymakers consider what economic tools are most effective in reversing the rise in inequality. Economic inequality is the defining issue of our time. In the United States, the wealth share of the top 1% has risen from 25% in the late 1970s to around 40% today. The percentage of children earning more than their parents has fallen from 90% in the 1940s to around 50% today. In Combating Inequality, leading economists, many of them current or former policymakers, bring good news: we have the tools to reverse the rise in inequality. In their discussions, they consider which of these tools are the most effective at doing so.

Where Latin American government leaders once looked at free trade agreements as solely about trade and trading policies, they are increasingly viewing them as the next beacon of hope in the long and arduous road of economic reform.

"Integrating the Americas: FTAA and Beyond" discusses how these governments have become embroiled in a larger set of issues affecting both institutions. This work, based on a conference sponsored by the Inter-American Development Bank and the David Rockefeller Center for Latin American Studies, examines how this free trade process is surging ahead, while at the same time taking on a broader set of issues including institutional reform, transparency, the environment, labor, and social cohesion. The payoffs to the strategy of liberalization, privatization, and openness have been meager and disappointing to date. Will the FTAA be able to reverse this and allow Latin America to reap the benefits of globalization?

Globalization is exposing social fissures between those with the education, skills, and mobility to flourish in an unfettered world market-the apparent "winners"-and those without. These apparent "losers" are increasingly anxious about their standards of living and their precarious place in an integrated world economy. The result is severe tension between the market and broad sectors of society, with governments caught in the middle. Compounding the very real problems that need to be addressed by all involved, the knee-jerk rhetoric of both sides threatens to crowd out rational debate. From the United States to Europe to Asia, positions are hardening. Dani Rodrik brings a clear and reasoned voice to these questions. Has Globalization Gone Too Far? takes an unblinking and objective look at the benefits-and risks-of international economic integration, and criticizes mainstream economists for downplaying its dangers. It also makes a unique and persuasive case that the "winners" have as much at stake from the possible consequences of social instability as the "losers." As Rodrik points out, "...social disintegration is not a spectator sport-those on the sidelines also get splashed with mud from the field. Ultimately, the deepening of social fissures can harm all." President Clinton read the book and it provided the conceptual basis for the trade/IMF portions of his State of the Union message in January 1998.

En esta crítica incisiva, Dani Rodrik combina el relato histórico con astutas observaciones que cuestionan la creencia de que el avance de la globalización es inevitable —e inevitablemente positivo— y argumenta que la globalización va acompañada necesariamente de tensiones muy graves.La paradoja de la globalización plantea un tema que ha adquirido, a raíz de la crisis del euro, una candente actualidad. Se trata del conflicto entre decisiones democráticas a escala de cada nación y decisiones tecnocráticas a escala supranacional. En el libro, el autor presenta un argumento a favor de un modelo de globalización atemperado, que sea respetuoso con las democracias nacionales y que esté fundamentado en un entramado muy elemental de reglas internacionales.Ahora que nos enfrentamos a unos desafíos globales tanto en el comercio, como en las finanzas como en los mercados laborales, la bien fundamentada propuesta de Rodrik muestra el camino hacia una prosperidad equilibrada y sostenible.

This challenging and unique new volume examines some of the most burning issues on the economic agenda in the world today. Bringing together a number of the foremost authorities in their fields, this book is the result of work carried out on behalf of the G24, the world s only research effort devoted to furthering the interests of developing countries, and bringing their needs to global attention. Nowhere is the voice of the developing nations expressed as cogently and powerfully as in the essays contained in this volume.Challenging the existing mechanisms for the governance of the world economy, the chapters in this book consider the current approaches of the IMF and World Bank, and the operations of financial markets and offer alternative proposals for the effective participation of developing countries in these for a. IN doing so, the volume ranges from discussions on reforming the IMF and its conditionality, debt workouts and restructuring, through management of capital flows, debt sustainability and insurance against crisis, to Millennium Development Goals and the global partnership development. This volume is a compelling reminder of the long road to be travelled before the governance of the world economy becomes truly responsive to the aspirations and needs of the developing world.

This essay addresses the "new-new" issues on the emerging agenda for the global trade negotiations to follow the recently concluded Uruguay Round. The authors first examine the extent to which international rules in new trade areas are needed and then consider the three highest profile issues: competition policy, labor standards, and linking trade and environment.

Robert Lawrence argues that if an international agreement on competition policy was possible, developing countries would derive considerable benefits. Dani Rodrik examines the evidence and concludes that labor standards--or lack thereof--have consequences for trade and foreign investment patterns. He then considers whether a social-safeguards approach can be made to work for labor standards and suggests that the risks of not negotiating such a clause outweigh the dangers of an inappropriately designed process. Finally, John Whalley argues that the central issue for trade and the environment is whether developing countries should be compensated for policies encouraging environmental restraint.