Return to Veseth home page 

Index of Book Reviews

What I'm Reading Now Archives

This website contains my pre-2007 book reviews.  To see what I have read more recently, please click on the link to visit my book blog at  http://mvreading.blogspot.com/

---

Columbia University Professor Frederic Mishkin is a renown expert on banking, finance and monetary policy.  His textbook on money and banking is the standard reference in this field.  I was more than a little surprised, therefore, to find that he has written a book about globalization.  It is a very good book and a very useful contribution to this field.

The conventional wisdom about globalization is that free trade is clearly beneficial to the world and to less developed countries, too (Mishkin calls them "disadvantaged" nations).  But free finance is another matter.  Financial globalization, most people insist, has not delivered the goods.  The benefits from access to global capital markets, the story goes, are offset by the risks associated with hot money flows and the financial and currency crises that they have helped create. 

Mishkin's book argues that global finance can have great benefits, but only if we do it right.  As an expert on banks and finance, he argues that there are a number of important principles that must be followed in opening a "disadvantaged" economy to global capital markets.  He explains these principles and then shows there relevance in three case studies: Mexico, South Korea and Argentina.

One of Mishkin's big points is that rich country credit markets are fundamentally different from poor country credit markets (the countries wouldn't still be poor, I suppose, if their credit markets were better able to facilitate economic growth), so policies that make sense for rich countries systematically create problems in poor countries.  This is the same point that Joe Stiglitz makes when talking about trade.  Interestingly, Mishkin singles out Stiglitz's proposals for dealing with poor country financial crises as an example of what's wrong with current policies.  Stiglitz's ideas would work in rich countries, Mishkin says in Chapter 10, but they are exactly the wrong policies for poor countries.  He concludes the book with chatpers on what rich countries and the IMF can do to make financial globalization work.

I've changed my mind about Joe Stiglitz.  If you read my reviews (see index of reviews) of Globalization and Its Discontents and The Roaring Nineties you will see that I was very concerned that Stiglitz was letting personal animosities get in the way of making important arguments.  Stick to the issues, Joe! I said.  Now, after reading Making Globalization Work (which has a few of the same irritating passages) I've decided that my previous criticisms just don't matter.  You see, I've decided that Stiglitz is the New Keynes.  Probably Joe has already figured this out.  That changes everything.

John Maynard Keynes was brilliant, charming, annoying the sometimes even rude. (OK, apparently he was frequently rude.)  This comes through again and again in Robert Skidelsky's biography (see index of reviews).  The bad behavior often made him less effective, but ultimately it didn't matter because Keynes's role in history was ideas not politics.  Keynes was needed to supply the ideas that others, who minded politics and avoided hurt feelings, could turn into action. That's what he needed to do and he did it.

It seems to me that Stiglitz is playing the same role.  His job is to shake things up not keep everyone happy.  Globalization and Its Discontents is the contemporary analog of Keynes's best-selling The Economic Consequences of the Peace.  That book said, "Look, I was there when the horrible mistakes were made.  I saw them being made.  Let me tell you where those mistakes will lead."  The mistakes Keynes saw were at the Treaty of Versailles negotiations and where they took us was the rise of Nazi Germany and World War II. Keynes's analysis of the Treaty negotiation disaster was detailed, persuasive, personal and sometimes even cruel.  Worse than Stiglitz in this regard, I admit.  And very effective in shaking things up, although it didn't prevent the disasters it foresaw.

The mistakes that Stiglitz saw were at the Asia Financial Crisis and we still don't know for sure where they might lead, but the Seattle WTO protests and perhaps the breakdown of the Doha WTO Round are mileposts on the route.

This new book, Making Globalization Work, reminds me of the grand global plans that Keynes hatched  before the Bretton Woods meetings.  It wasn't enough, Keynes thought, to tinker with the gold standard,  it would be necessary to reinvent the international system from the ground up after WWII, with new interests and institutions.  Politically unrealistic, but right on the mark from the economic point of view. (Ironically, Stiglitz actually cites some of them as good ideas for today's in the chapter on global reserves).

In the same way, Stiglitz's new book tries to reinvent the global system after the Seattle WTO meetings.  New regimes are required for trade, debt, intellectual property rights, global reserves, the environment ... and more.  It is the sort of proposal that is totally unrealistic in terms of political interests.  But of course it isn't its job to be realistic.  The book is meant to loudly broadcast politically radical but economically sensible ideas and make it possible for others to seize and exploit them.  Interests will oppose them today, but it was Keynes who told us that, in the long run, ideas and not interests rule. 

There are a lot of ideas here and they are worth your time to consider.  I think the  strongest chapters are on international trade and intellectual property rights and the need to change the rules of the game to take into account the differential capabilities of less developed countries.   The most puzzling chapter is the one on multinational corporations.  Stiglitz knows that there are incentive problems that prevent MNCs from playing a more constructive role in globalization, but unlike the other chapters he doesn't really have a plan to deal with them. The biggest surprise is that global financial instability and the role of the IMF do not receive more attention. You might have expected Stiglitz to have more to say here.

But you can see that my criticisms are not that Stiglitz is too radical.  Begin radical is his job if he's really the New Keynes.  Shoot, maybe he isn't radical enough! So I've changed my mind.  I just hate to change my mind -- don't you?  I really hope that I'm right this time.  I really do.

Expatriate books have become a popular non-fiction genre.  You know what I'm talking about -- books like Under the Tuscan Sun or A Year in Provence.  I really hate these books (with the exception of Tim Parks's book Italian Neighbors and Beppe Severgnini's Ciao America) because you learn so little about real life in the adopted country and so much about the attitudes of the expats themselves. They seem to be mostly accounts of how annoying it is to deal with foreign plumbers, foreign contractors and foreign real estate agents.  Well -- hello! -- it can be annoying to deal with these folks at home, too.  There is more to life abroad than service industry frustrations.  It seems to me that the only reason to read books like these is to get some small insight into the people, how they live, and what forces have shaped their attitudes and lives and many of these books have little to say in this regard.

The Merry Baker fits the standard expat story genre, but somehow manages to transcend it.  Zemtzov falls in love with a Latvian woman and so moves to Riga to be with her.  Being an entrepreneurial American (and needing to make a living) he negotiates a deal with the formerly communist state bureaucracy and opens a bakery. He has no experience running a bakery or even baking himself, but he detects an unmet local need for really good pastries, and so the die is cast.

Zemtzov does follow the standard model to an extent -- we do learn about all his frustrations with plumbers, local officials and so forth.  But there is more to learn here because his story is really less about the bakery and more about the problems of economic social transition in Latvia.  Reading this book gave me a better sense about the strength of the Soviet legacy and the magnitude of the barriers that the Latvians have had overcome.  It makes me appreciate even more my former Prague students who live in Riga: Andris, Juris, Elina and Boriss

Everyone knows that I am suspicious of simple answers to complicated questions.  I am suspicious, for example, of the idea that globalization is Americanization.  It seems to me that globalization is pretty complicated and America is no simple thing either, so the idea that they are the same isn't something that I can choke down easily.

William Marling has the same feeling.  He's a professor of world literature at Case Western Reserve University who has lived in many corners of the world.  He brings his own personal experiences and a good deal of solid research to this study of cultural globalization.

So, how American is globalization anyway?  Marling's answer is, "less than you think, but more than you know."  Which is a good answer, in my opinion.  In the "less than you think" chapter he debunks the idea that the U.S. has overwhelmed the world through the influence of American film, fast food, corporations, and so on.  When you look closely at each of these popular stereotypes, complexity appears and the simple "Americanized" label peels off.  How is this possible?  Marling explains in a chapter that examines the strength of the local to resist the global.

The least successful part of the book is the "more than you know" chapter, where Marling argues that people who look at fast food and advertising are missing the point -- the real American influence is deeper and takes the form of more subtle influences that transform social structures.  I suspect that Marling is right about this, but I'm not sure his case studies are that convincing.  But they made me think, and that's always worthwhile.  An excellent addition to the globalization bookshelf.

Jeffrey Frieden teaches IPE at Harvard and he has written a big, ambitious book.  It is an analytical history of the rise and fall and rise again of global capitalism from about 1896 until 2000.  The book is big (550+ pages), but the topic of course is bigger still.  Shoot, it took Robert Skidelsky three volumes and about 2000 pages just to talk about Keynes's role in this story.  Frieden has a lot of nerve trying to fit everything in a single volume like this.

Frieden does a good job with such a huge topic and I learned a lot.  Writing Big History is a tricky business -- an exercise in leaving things out and being superficial where it doesn't matter and going into depth where it does.  You can argue about some of the choices Frieden has made, of course, but it's impossible to avoid making the choices.

Frieden's organization is much like the one that I used in the book I edited a few years ago, The New York Times 20th Century in Review: The Rise of the Global Economy (Fitsroy-Dearborn, 2002). The expansion of globalization creates tensions and leads to crises, which weaken support for it and ultimately cause a reaction against it.  But the potential benefits of globalization are so great that they process repeats.  Hence the rise, fall, rise again and -- perhaps -- fall of global capitalism? It's more or less the Karl Polanyi theme of the double-movement.

A book of such scope rightly resists oversimplification, but I understand that you want to know the bottom line.  Here is it:  globalization and the open system it fosters is full of trade-offs.  There are costs (and losers) and benefits (and winners).  Ultimately, the benefits are worth the costs, but the losers cannot be ignored because they can undermine support for globalization and ultimately destroy it.  The state, therefore, needs to take a lesson from Keynes's book and adopt programs to assistant the losers and reduce the perceived risk of interdependence in general.  Global capitalism, in other words, needs strong state support to succeed.  Global capitalism with a minimal state of the sort that is often advocated, is an unstable foundation for prosperity.  That's pretty much what Frieden says, although he probably says it better, and I agree.

The Economist gave this book a highly favorable review last year, so I ordered it from Amazon.uk and then let it sit on my bookshelf for almost a year.  It's a big book (700+ pages) and one that obviously merits a close reading.  Not enough time to read it properly, I kept telling myself, and so it sat, gathering dust.  Then finally in August I decided that it would be better to give it a quick and uneven reading than not to read it at all.  I'm glad I did.

Kedward organizes his history of France around three overlapping themes:  nationalism and the primacy of the republic (1900-1933), the spiral of ideology (1920s-1969) and the problem of identity (1960s-present).  Within each theme we are presented with a sort of total history tapestry, if such a thing exists, with political, social, cultural and economic issues interwoven throughout.  The resulting work is complex and interesting, but one that deserve close study.

I learned a lot from my quick read through, especially about the history of immigration in France and the attitude towards migrants, which is more complicated and layered than I thought.  Other topics I found especially interesting were the sections of French economic policy, its problem with empire, and the franco-french conflict.  The best thing, however, was the way it made me think about (and rethink) the American experience and my assumptions about American exceptionalism.  Don't let your copy of this book gather dust!

The problem with globalization is that there is not enough of it.  No wonder it makes enemies.  This is the interesting and controversial thesis of French economist Daniel Cohen's new book.  Globalization promises to engulf the world, but it doesn't keep its promises.  People is the "left out" spaces see the fruits of globalization on television and at the movies, but then they get frustrated when it doesn't come around.  The problem of the periphery is not that they are exploited by the core, but that they are ignored by it.

There are a lot of interesting ideas in this collection of essays.  The analysis of population growth trends is surprising, for example, and makes me realize that I am not keeping up on demographic data.  I also find the distinction between Smithian growth (for Adam Smith) versus Schumpeterian growth (Joseph Schumpeter) very interesting.  The EU aims for Smithin growth, in Cohen's analysis -- which is growth through bigger markets and a more productive division of labor.  Meanwhile the U.S. is pursuing Schumpeterian growth, he says, which is growth by innovation and "creative destruction."

The Roman dilemma, according to Princeton historian Harold James, is not Venus versus Mars, as Robert Kagan says, but Mercury versus Mars.  Mercury is the god of commerce and a prosperous global commercial system needs rules and order.  But rules and order are prone to be viewed as self-interested exercises in power by those who do not benefit from them (or who believe that they do not benefit enough).  Order becomes empire in the eyes of these beholders, therefore, and empire calls forth resistance, conflict and disorder.  The dilemma is how to have Mercury without summoning Mars.

James explores this theme both in the current context, where it obviously applies, but also through an examination of Adam Smith's and Edward Gibbon's 18th-century commentaries on the Roman Empire, which were crafted to inform the debate on the dilemmas of the British empire.  My favorite chapter contrasts the Roman Empire (the U.S.) with the Holy Roman Empire (the E.U.). 

I also find James's analysis of the relationship between the global trade and finance regimes to be very instructive. The trade regime is highly ordered -- lots of WTO rules.  The legitimacy of these rules is undermined to a certain extent because monetary relations among nations are not well-ordered.  Rule-based free trade with China is controversial, therefore, because China may be guilty of biasing that trade through exchange rate manipulation.  A damaging trade war could result, which would destroy order.  For order to be effective, you need order throughout the system.

What is to be done? James says that values are the key -- a dialogue about fundamental values (not fundamentalist dogma).  A very thought-provoking book.

This is my favorite book of 2006 (so far).  It's a globalization book, of course, but an unexpected one.  Curry (Indian food) is one of the world's great global cuisines.  You can find curry just about everywhere in the world -- that much I knew before reading the book.  Curry is the real McDonalds, especially in Great Britain where it basically is McDonalds -- the most popular form of fast food.

But who knew that there was so much more to the story.  Collingham tells a complicated and fascinating story of how Indian cooking has been shaped by foreign influences over the centuries (the Mughal, Portuguese and British Empires) and how these influences have been imported and adapted, exported and adapted and even re-imported again to create the hybrid cuisine that we know today.  Each chapter tells a fascinating story of economic, political and cultural globalization -- and includes recipes for the ambitious cook, too.  I was particularly taken by the political economy of meat-eating in Portuguese-ruled Goa and by the story of how the British coerced India to drink chai tea in order to get them to drink tea (they already drank a lot of milk, which makes sense when you think of it, but tea was a "foreign" product).

It is difficult to think of "authentic" food or culture quite the same way after reading Curry.

This is a fascinating book about how the now ubiquitous shipping container and how it made many elements of globalization possible by lowering transportation costs and increasing efficiency.  The author is a former finance and economics editor at the Economist, so you know that it is clearly written and full of facts.  Many important ideas here, including the advantage of having international standards (in this case, for the size and properties of shipping containers) and the political and economic conflicts that are inherent in standard-making.  You will be surprised at the role of the U.S. military and the Vietnam War in creating a world of containers.

The most interesting part of the book for me is the description of how shipping and international trade took place before containers.  I really had no idea how "breakbulk" shipping worked and how inefficient it was.  This book makes me realize how much of our globalized economy is based upon efficient transportation and how the mechanics of the container system has transformed many elements of the product chain.

A new book by Nobel laureate Joseph E. Stiglitz (author of Globalization and Its Discontents and The Roaring Nineties) is bound to attract a lot of attention, and this volume (written with Andrew Charlton) rewards a close reading.  Stiglitz is founder of the Initiative for Policy Dialogue (IPD); IPD’s  recommendations for a “development round” of World Trade Organization (WTO)  negotiations forms the core of the book. 

The authors argue that many of the basic premises of the WTO need to be reconsidered and that the principles that guide trade liberalization need to be reformed if trade is to benefit less developed countries.  Orthodox free trade principles are based upon assumptions of perfectly competitive markets that are especially lacking in less developed countries.  In a world of costly and asymmetric information, a simply-minded push for free trade can increase risk and impose high adjustment costs.  This view will not surprise economists familiar with Stiglitz’s research on information economics. 

The book is written for a relatively sophisticated readership that is familiar with economic principles and trade policy issues.  A must read for everyone seriously interested in trade and development.

Edward Tufte is a former Yale professor of political economy who writes books about how to communicate ideas (especially quantitative information) effectively.  He thinks this is really important and it is easy to see why.  Perhaps his most famous case study (found in one of his three earlier books on communication)  is of the presentation data that was used to assess the risk of launching the Space Shuttle before the Challenger disaster in 1986.  Although the engineering data clearly showed the risk of )-ring failure,  the way that the data was presented made this critical information almost impossible to understand correctly.  Tufte presents a similar analysis of the unintentionally misleading PowerPoint presentations that contributed to the Challenger disaster 2003.

This is a beautiful book and a very informative one. It is all about the evidence that is used to back up arguments and how that evidence can be presented poorly, to confuse or mislead, or well.  The single most useful and memorable section is the chapter on "The Cognitive Style of PowerPoint."  Tufte just hates PowerPoint and he provides a very detailed critique as well as useful suggestions for better alternatives. 

PowerPoint does not harm to the top 10% of presenters, he says, who have such clear ideas that they are impervious to PowerPoint's templates and gimmicks.  And it probably actually helps the 10% of presenters at the bottom of the heap, because it at least makes them have some organization.  But for the rest of us (the 80% in the middle) PowerPoint is the enemy of clear thinking and talking.  If you produce or consume PowerPoint presentations, you need to read this book.

I own and recommend all of Edward Tufte's books and I also am a fan of his lectures/seminars.  Details at www.edwardtufte.com .

Future historians will look back at the 1990s as a critical decade in the evolution of the global economy.  This volume is the best guide yet to understanding the complex and turbulent time just past and its implications for the future – must reading, in my opinion, for scholars and policy-makers.  The twelve chapters presented here are the product of a 2004 conference that brought together a very talented group of economic historians and asked them to consider the 1990s from the standpoint of economic history (several authors draw particular parallels to the 1920s).

All of the essays are first rate.  Nicholas Crafts, for example, provides a stunning synthesis of research on global patterns of growth and stagnation in the 1990s.  Barry Eichengreen writes on global economic management.  Alexander Field, Gavin Wright and Paul Rousseau contribute individual essays on the role of technology in ‘90s growth. Peter Temin asks if growth the 1990s is an example of “postwar growth” (post Cold War growth, of course) and Peter Lindert debunks the myth of the triumph of neoliberalism and the death of the welfare state. Clear analysis, strong evidence, great bibliography.

Brian Fugere, Chelsea Hardaway and Jon Warshawsky, Why Business People Speak Like Idiots. Free Press, 2006.

Full disclosure: Brian Fugere is a former student of mine who is an expert on B.S., having written or read thousands of business memos and reports throughout his career at a top-flight management consulting firm.  Finally, he just got fed up with the jargon that prevented people from communicating effectively and he decided to do something about it.  His first effort was Bullfighter (http://www.fightthebull.com/bullfighter.asp), a computer program that reads your Word documents and critiques them according to readability and B.S. content.  It's a great little program that makes you think about how you write and who your audience is.  (It is also a great tool to use when you get a poorly-written memo and you want to get the author's attention).

This book takes Bullfighter to the next level, explaining why business-people (and government- and academic-people) communicate so poorly and providing practical suggestions for reform.  Brian and his co-authors include lots of examples of jibba-jabba* they have collected from the field and show how sloppy writing leads to sloppy thinking.   It is a good book to give to your boss and I recommend it highly.  There are a number of sections that made me laugh out loud, including "the fog of business" the importance of humor, and the La-Z-Boy story that begins chapter 9. 

*This book is dedicated, it says, to the television character known as Mr. T (remember him on "The A-Team?"), who coined the phrase "jibba-jabba."

This is a truly innovative book that draws upon management theory, economics and public policy to contribute to an important social debate. Kaplinsky’s contribution is to ask what is really new about 21^st century global capitalism and then to track down the implications for poverty and inequality.    What’s new is the rising importance of global production networks, an innovative technique of industrial organization that has lead to the broad diffusing of production in the global economy.  Kaplinksy argues that, within the production networks, there are assets that can be protected from competition and that therefore earn rising rents and other assets that face fierce competitive pressures with corresponding falling returns. Less developed countries are caught "between a rock and a hard place," as the book's subtitle suggests, as they compete in cut-throat markets while trying to create rent-earning assets of their own.

I especially like this book because it is the one of the best attempts I have seen to integrate global production networks into the big picture of international political economy.Three case studies are presented: clothing and textiles, autos and auto components, and furniture. The increasing integration of China and India into global markets is likely to intensify this process, he argues, by intensifying competition for production income and increasing the value of rents. 

Paul Bluestein is an economics writer at The Washington Post.  I very much admired his 2001  book, The Chastening: Inside the Crisis that Rocked the Global Financial System and Humbled the IMF because of the detailed and fair report it gave of the inside workings of the IMF during the Asian Financial Crisis.  It was, I thought then, the best reporting I had read on this subject.  That's high praise.

The new book is different in many respects, but equally good.  Once again Blustein rides shotgun with the IMF posse as it meets with Argentine officials, Wall Street interests and Treasury executives.  We get a really good picture of the inside workings of all sides of the negotiations:  the actors, the interests, the personalities, and the many, many missed opportunities.  You don't understand what happened in and to Argentina if you haven't read this book.

One thing that makes this book different from the first one is its undercurrent of anger.  You can see right from the start that this play is a tragedy -- it seems to have been perfectly obvious right from the start that Argentina's deficits were unsustainable and that breaking the link to the dollar was inevitable.  Yet rather than recognizing the situation and taking quick and decisive action, it seems like every decision made the problem worse and the ultimate cost greater.  It makes me, mad, too.  Blustein ends the book with suggestions for IMF reforms to make sure it doesn't happen again.

I don't know Paul Blustein, but apparently he is a friendly, helpful person in addition to being a good writer and economic reporter.  He was nice enough to meet with one of my students this summer who was in Washington doing research on these financial crises.  Keep up the good work.

Click here to see more of "What I'm Reading Now"