De-Globalisation? Global Value Chains in the Post-Covid-19 Age

51 Pages Posted: 23 Nov 2020

See all articles by Pol Antras

Pol Antras

Harvard University - Department of Economics; National Bureau of Economic Research (NBER)

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Date Written: November 2020

Abstract

This paper evaluates the extent to which the world economy has entered a phase of de-globalisation, and it offers some speculative thoughts on the future of global value chains in the post-COVID-19 age. Although the growth of international trade flows relative to that of GDP has slowed down since the Great Recession, this paper finds little systematic evidence indicating that the world economy has already entered an era of de-globalisation. Instead, the observed slowdown in globalisation is a natural sequel to the unsustainable increase in globalisation experienced in the late 1980s, 1990s and early 2000s. I offer a description of the mechanisms leading to that earlier expansionary phase, together with a discussion of why these forces might have run out of steam, and of the extent to which they may be reversible. I conclude that the main challenge for the future of globalisation is institutional and political in nature rather than technological, although new technologies might aggravate the trends in inequality that have created the current political backlash against globalisation. Zooming in on the COVID-19 global pandemic, I similarly conclude that the current health crisis may further darken the future of globalisation if it aggravates policy tensions across countries.

Suggested Citation

Antras, Pol, De-Globalisation? Global Value Chains in the Post-Covid-19 Age (November 2020). NBER Working Paper No. w28115, Available at SSRN: https://ssrn.com/abstract=3735683

Pol Antras (Contact Author)

Harvard University - Department of Economics ( email )

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