Book Reviews

Globalization as virtual reality

Daniel Cohen

Globalization and Its Enemies

MIT Press, Cambridge, Massachusetts, 2006, 192 pp., $27.95 (cloth).

Since neither the proponents nor the opponents of globalization are ready for a truce just yet, the pile of books on this fascinating topic just keeps growing. So why should we want to read Globalization and Its Enemies? The answer is that Daniel Cohen manages to take a broad swipe at many commonly held, as well as emerging, clichés of globalization in a highly provocative yet unpretentious manner.

To Cohen, the cliché that we live in a borderless, globally interconnected world is just that-a cliché. The much-vaunted image of a "new closeness between nations" is only virtual, not real, he argues. Although in previous phases of globalization, people moved physically, they now move virtually. And while there is no denying that merchandise is being traded across borders, people of rich countries encounter people of poor countries only during a few precious vacation weeks. Poor countries are essentially left to their fate.

At the same time, Cohen dismisses the contention that rich countries exploit poor countries. Globalization is a source of frustration for many "because of what has yet to happen, not what has already taken place," he writes, adding that "it is difficult to be an actor but easy to be a spectator" in the current phase of globalization. Cohen agrees that yesterday's industrialization in the North is responsible for much of today's poverty in the South, but he cautions that the deindustrialization of advanced economies "will not by itself create tomorrow's prosperity in the developing world." The developing countries must become centers of growth in their own right. This is an uphill battle. When a high-speed train connects two cities, "it is the less populated city that will suffer the consequences"-the falling costs of transportation and communication do not promote wealth but instead favor its polarization.

Cohen sees wealth creation as depending on the operation of a series of levers. The first lever is human capital (education and professional experience), the second is physical capital (machines and equipment), and the third is global efficiency (technological progress). The tragedy of the poor countries is that they want to participate but that the world essentially ignores them. Institutions must be created to facilitate their entry into global capitalism, he argues, dismissing the work of existing international institutions as "merely repetitions of colonial style." But he also reminds poor countries that they must decide "whether they will jump out of the protectionist frying pan into the globalist fire."

Cohen does a good job of demystifying the contemporary phase of globalization. He is right to say that the poor image of globalization is due to the fact that "it has altered people's expectations more than it has increased their ability to act." His diagnosis of poverty as manifested by the lack of levers rings true. If the book has one failure, it is that it ultimately provides little in the way of workable solutions.

Caf Dowlah

Professor of Economics City University of New York

Converting uncertainty into risk

Hilton Root

Capital and Collusion The Political Logic of Global Economic Development

Princeton University Press...

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