By Togbah Push Wleh
Populism and Globalization
Tim Stobierski defined globalization as “the increased flow of goods, services, capital, people, and ideas across international boundaries…”1 The Peterson Institute for International Economics (PIIE) has it as a process that “describes the growing interdependence of the world’s economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information.”2 These two definitions are similar, differing only in wording. However, they raise fundamental questions unintentionally: When did globalization begin? What are the consequences? To what extent do the factors, theory, process, and consequences of globalization apply today as compared to the past, and in what context or form? However, while the process of globalization is ancient (going back to 130 BCE-1453 CE with the Silk Road,3 or perhaps human migration out of Africa long before it), occurring long before Theodore Levitt would coin the phrase “globalization” in 1983,4 its consequences are continuous, triggering reactions all over the world and prompting scholars to conduct studies to comprehend and conceptualize their impacts.
Globalization is a process that has undergone several stages, eventually culminating in what we know today. Nonetheless, the consequences of one significant historical event do echo the definitions, reality, or perhaps the consequences of globalization as we continue to experience it today: the Columbian Exchange (CE). This was the exchange and proliferation of plants and animal species, cultures, human populations (voluntary or involuntary), disease, and knowledge (i.e., information, technology) between the Old World (Africa, Asia, Europe) and the New World (the Americas). Its consequences brought changes in human relations, conquest, mass enslavement, and genocide. Yet, while many may argue that today’s globalization shares similar consequences with the Columbian Exchange, it differs in that it has resulted in two forms of reaction that may shape political and cultural phenomena throughout this century and beyond: nationalism and populism.
“Trade liberalization is the opposite of protectionism—when countries allow people and businesses to buy and sell across borders with fewer restrictions. In this context, liberal refers to more free or open trade.”5 In Rodrik’s article, I find two compelling arguments linking right populism and globalization (including financial globalization, which is probably more impactful to Africa), centered on trade liberalization (the elimination of restrictions and the promotion of “free trade” policies),
1 Stobierski, Tim. “6 Pros and Cons of Globalization in Business to Consider.” Harvard Business School, April 1, 2021.
2 Kolb, Melina. “What Is Globalization? And How Has the Global Economy Shaped the United States?” Peterson Institute for International Economics, October 29, 2018.
3 Hamm, Heloïse. “Globalization and Its History.” International Lyon Model United Nations (ILYMUN), February 10, 2023.
4 Hamm, Heloïse. “Globalization and Its History.” International Lyon Model United Nations (ILYMUN), February 10, 2023.
5 Kolb, Melina. “What Is Globalization? And How Has the Global Economy Shaped the United States?” Peterson Institute for International Economics, October 29, 2018.
redistribution, and reactions from workers and politicians. His findings can be generalized worldwide. 1) Rodrik contends that low-skill workers get the worst of the bargain with trade or economic liberalization. It has led to job losses and a reorientation of labor and production. “The United States imports more goods than it exports and exports more services than it imports, reaching an overall trade deficit of $785 billion in 2023.”6 This simply illustrates the loss of manufacturing jobs, meaning that low-skilled workers would have to switch to the service sector or be unemployed. The practical aspects of globalization can lead to ethno-national or cultural populism when the shock is immigration- or refugee-based, and to income- or social class-based populism when the shock is trade, finance, or foreign investment. Trade liberalization, NAFTA, and China’s entry into the WTO have negatively affected domestic workers, particularly low-wage and low-skilled workers, in regions affected by NAFTA.
NAFTA, Rodrik stresses, led to US imports from Mexico doubling, even though Mexico’s economy is much smaller. China’s share of world manufacturing production rose from 2.7% or 2.8% in 1990 to 7.0% in 2000,7 to 18.5% at its peak in 2015.8 But this only begs multiple questions: Is the disparity between the U.S. and its trading partners the result of the decline in U.S. industrial production? Did NAFTA deindustrialize the United States, or was it a natural result of economic and trade liberalization? According to PIIE, “The percent of US jobs in manufacturing has steadily declined since the 1940s, before the rise of China, NAFTA, or the WTO, mainly because technology has made it easier to produce goods. American industrial production is at historically high levels, but fewer people are needed to achieve this success.”9 Could Mexico’s trade increase be the result of them producing more of what the US need compared to the US producing less of what Mexico needs? Do Mexico’s imports come from domestic Mexican companies or from those relocated from the United States?
2) Rodrik outlines the economic roots of populism, emphasizing globalization’s negative effects despite it promises. Globalization, he argues, creates opportunities for exporters, multinational companies, investors, international banks, and managerial and professional classes in a position to take advantage of larger and free markets. However, it can negatively impact local communities and regions, as seen in Mexico and the United States. But Rodrik stresses that technology and automation are contributing to the problem in various regions, and workers are feeling the pinch. He writes that “Changes in technology, rise of winner-take-all markets, erosion of labor-market protections, and decline of norms restricting pay differentials…” while “not entirely independent from globalization…both fostered globalization and were reinforced by it.” He adds that “…advanced stages of globalization are prone to populist backlash.”10 Yet, as he suggests, the irony is that populist leaders focus their assault on trade and globalization in general rather than on technology and automation. Therefore, Rodrik declared that because politicians are unable to identify (Chinese, German, or Mexicans) as the source of the problem, they scapegoat trade instead.11
6 Kolb, Melina. “What Is Globalization? And How Has the Global Economy Shaped the United States?” Peterson Institute for International Economics, October 29, 2018.
7 Crafts, Nicholas. “The World Economy in the 1990s: A Long Run Perspective.” Department of Economic History, London School of Economics, December 23, 2004, 42.
8 “Who Is the Next ‘China’ in Labor-Intensive Manufacturing? So Far: China.” FSI. Accessed February 27, 2026.
9 Kolb, Melina. “What Is Globalization? And How Has the Global Economy Shaped the United States?” Peterson Institute for International Economics, October 29, 2018.
10 Rodrik, Dani. “Populism and the Economics of Globalization.” Journal of International Business Policy 1 (1–2) (June 2017): 12–33.
11 Rodrik, Dani. “Populism and the Economics of Globalization.” Journal of International Business Policy 1 (1–2) (June 2017): 12–33.
Around the world, people are resisting the current wave of globalization. The World Economic Forum states that, “…internationally, the power that propelled the world to its highest level of globalization ever, the United States, is backing away from its role as policeman and trade champion of the world.”12 What we are seeing is the American public and the Trump administration attacking globalization.
As previously mentioned, globalization has its strengths (cross-border investment, enhanced welfare, job creation, knowledge, poverty reduction, technology advancement) and weaknesses (among which are loss of jobs, and the reorientation of production), and by weakness, it has not been good for the working man.13 However, while Rodrik made a strong argument that technological advancement and automation are both good (for companies) and bad (for workers), financial globalization mirrors this reality. It is good for foreign institutions with the means. However, I agree that financial globalization can be negative for countries and regions, particularly those that should be bringing in capital. Financial globalization, he declares, “accentuates the weakness of domestic institutions and debt-enforcement mechanisms.”14 This form of globalization includes capital mobility (the distribution or redistribution of financial assets), enabling countries with higher returns to save, engage in international borrowing and lending, and diversify their portfolios. However, there is a tendency for opportunistic behavior and periodic debt crises, and both domestic and foreign debt crises occur simultaneously, resulting in capital flight from a host country that should be importing capital.15 This is the reality for Africa. “From 1970-2018, African countries lost over $2 trillion through capital flight, which is almost the annual gross domestic product of all sub-Saharan African countries combined. Compared to $47 billion of aid inflows, African countries lose an estimated $60 billion a year through capital flight.”16 While Africa loses capital to financial globalization, it receives development aid, which is damaging in many ways
Work Cited
“A Brief History of Globalization.” World Economic Forum, January 17, 2019.
Collins, Mike. “The Pros and Cons of Globalization.” Forbes, May 6, 2015.
Crafts, Nicholas. “The World Economy in the 1990s: A Long Run Perspective.” Department of Economic History, London School of Economics, December 23, 2004, 42.
Hamm, Heloïse. “Globalization and Its History.” International Lyon Model United Nations (ILYMUN), February 10, 2023.
Kolb, Melina. “What Is Globalization? And How Has the Global Economy Shaped the United States?” Peterson Institute for International Economics, October 29, 2018.
Moses, Oyintarelado (Tarela). “Webinar Summary – On the Trail of Capital Flight from Africa: The Takers and the Enablers.” Boston University Global Development Policy Center, October 27, 2022.
Rodrik, Dani. “Populism and the Economics of Globalization.” Journal of International Business Policy 1 (1–2) (June 2017): 12–33.
Stobierski, Tim. “6 Pros and Cons of Globalization in Business to Consider.” Harvard Business School, April 1, 2021.
“Who Is the Next ‘China’ in Labor-Intensive Manufacturing? So Far: China.” FSI. Accessed February 27, 2026.
