“Globotics and macroeconomics: Globalisation and automation of the service sector” by Richard Baldwin
Globalisation affects the functioning of the euro area macroeconomy. The macroeconomy’s functioning, in turn, conditions the conduct and impact of monetary policy. This is why globalisation matters for central banks. It is also why central bankers should pay attention to the evolution of globalisation. And evolve it has. This paper argues that the future of trade is in services – especially trade in intermediate services. Barriers are radically higher and falling radically faster for services versus goods, and, unlike farm and factory goods, there is no capacity constraint when it comes to intermediate services exports from emerging markets. The paper argues that undertaking the sort of analysis for services trade that was done in the 2000s on globalisation’s impact on, say, HICP inflation will require a substantial upgrading of the data available.
Richard Baldwin is Professor of International Economics at the Graduate Institute, Geneva, Founder and Editor-in-Chief of the policy portal VoxEU.org. He regularly advises governments and international organisations on globalisation and trade policy issues. In 1990-91 he served as a Senior Staff Economist for President George Bush’s Council of Economic Advisors, having completed his PhD in economics at MIT with Paul Krugman (with whom he has published a half dozen articles). His latest book, The Globotics Upheaval: Globalization, Robotics and the Future of Work, was published in February 2019.
Watch the replay of the conference
The International Macroeconomics Chair is the result of a partnership between the Banque de France and PSE. Sharing the same vision about scientific needs on international issues, these two organisations joint their efforts to build a chair with the objective of fostering the development of research on the financial & monetary international system, and in international Macroeconomics.