The Doom Loop
Why the World Economic Order Is Spiraling into Disorder
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- € 15,99
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- € 15,99
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The acclaimed economist and author of The Future of Money argues that the forces meant to stabilize the world’s economy are in fact driving global instability
“An excellent survey of some of the most important issues in international affairs today.” —Financial Times
Global economic power is shifting, liberal market-oriented democracies face growing domestic turmoil, and international trade and financial integration is crumbling. How did we get here?
In The Doom Loop, economist Eswar Prasad argues that the very forces that we long believed could stabilize the world order are fueling its destabilization. Rather than promoting shared prosperity, globalization has instead deepened economic inequality, stoked political backlash, and prompted escalating trade wars. Institutions like the International Monetary Fund and World Trade Organization, founded to foster international cooperation, have failed to adapt to twenty-first-century realities. The rise of “middle power” countries like India, Brazil, and Indonesia once suggested a stable multipolar future, but today, such nations are increasingly forced to pick sides as the United States and China fight for global dominance.
Prasad argues that we are caught in a destructive feedback loop between economics, domestic politics, and geopolitics. The Doom Loop offers a clear-eyed and bracing account of a world spiraling into disorder, and makes it clear that old solutions cannot pull us out—we need radically new solutions to solve the world’s problems.
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This trenchant treatise from economist Prasad (The Future of Money) argues that China's rise and America's wane are leading to global instability. The issue isn't brinkmanship per se but a chaos-generating feedback loop that has emerged from the two very different economic behemoths' attempts to compete with one another. ("My tribe of economists believes that competition is a positive force in practically every realm," but "basic precepts of microeconomics do not always apply to the complex world of geopolitics," Prasad notes.) To wit, in order to match each other's strengths, China is adopting more free market measures, while the U.S.-led West is seeing more state control of corporations and markets. This would seem on its surface to be a harmonious development, but instead, Prasad argues, it has led to "dysfunction," since there is no longer a universally understood set of rules governing the international order. Prasad's goal is twofold, as he seeks both to puncture the myth of globalization as inherently generating stability (he points to globalization's failure to evenly distribute its benefits across the world) but also to convince both sides that maintaining a working international order is more beneficial than retreating into zones of influence. To that end, he urges both sides to come together to work out a new set of international economic rules. Erudite and expansive, this will appeal to geopolitics wonks.
