Criticism
Globalization and Its Discontents has earned praises from many reviewers. Noted investor, George Soros describes the book as "Penetrating, insightful.... A seminal work that must be read."
The book has received criticisms from various camps. Writing in Public Choice D. W. MacKenzie claims that Stiglitz mischaracterizes government failures as market failures. Most of Stiglitz's examples refer to government intervention that benefited special interests. Such examples are collective action failures of government through rent seeking.
Kenneth Rogoff, IMF Director of research, called Stiglitz's analysis "at best highly controversial, at worst, snake oil" and stated that "The Stiglitzian prescription (for third world nations in a debt crisis) is to raise the profile of fiscal deficits, that is, to issue more debt and to print more money. You seem to believe that if a distressed government issues more currency, its citizens will suddenly think it more valuable. You seem to believe that when investors are no longer willing to hold a government's debt, all that needs to be done is to increase the supply and it will sell like hot cakes."
Daniel T. Griswold of the Cato Institute labels the book a "score-settling exercise distorted by the author's own political prejudices and personal animus." Griswold takes issue with what he claims is Stiglitz's assumption "that protectionism enriches those nations that practice it" and notes that "while he is not questioning free trade, Stiglitz is disparaging the free flow of capital. The book blames the East Asian Financial Crisis almost entirely on one factor: capital account liberalization." Stiglitz demonstrates this belief by "prais Malaysia for spurning IMF advice ... by imposing capital controls to stem the flight of short term flows." Griswold also states that Stiglitz provided no evidence to support his belief that Malaysia was rewarded for their efforts. He counters that Malaysia's GDP growth rate had fallen much farther than the other countries listed by Stiglitz, down to 6.7% and "recovered less rapidly in 1999 and 2000 even though did not resort to capital controls Stiglitz champions." Griswold concludes by arguing that Stiglitz "distorts the history of the East Asian Miracle", while with Russian privatization he "ignores the fact that Russia's initial reforms were timid and half baked" and that the IMF with its beliefs in bail outs and non-market exchange rates is not the "great symbol of market fundamentalism".
He has been accused of 'bad economics' by many libertarian organizations.
Read more about this topic: Globalization And Its Discontents
Famous quotes containing the word criticism:
“A friend of mine spoke of books that are dedicated like this: “To my wife, by whose helpful criticism ...” and so on. He said the dedication should really read: “To my wife. If it had not been for her continual criticism and persistent nagging doubt as to my ability, this book would have appeared in Harper’s instead of The Hardware Age.””
—Brenda Ueland (1891–1985)
“I consider criticism merely a preliminary excitement, a statement of things a writer has to clear up in his own head sometime or other, probably antecedent to writing; of no value unless it come to fruit in the created work later.”
—Ezra Pound (1885–1972)
“Homoeopathy is insignificant as an art of healing, but of great value as criticism on the hygeia or medical practice of the time.”
—Ralph Waldo Emerson (1803–1882)