Globalization leads to economic instability from "summary" of The Great Unraveling by Paul R. Krugman,University Paul Krugman
Globalization has undoubtedly brought about a new era of interconnectedness and economic growth. However, what many fail to recognize is the inherent instability that comes hand in hand with this phenomenon. As the barriers to trade and investment have been torn down, the global economy has become increasingly vulnerable to shocks and crises. The very nature of globalization means that problems in one part of the world can quickly spread to others. A financial crisis in one country can easily spill over into others, creating a domino effect that can destabilize the entire global economy. This interconnectedness means that economic instability is no longer contained within national borders, but rather has the potential to reverberate across the world. Moreover, the rise of multinational corporations and the increasing interconnectedness of financial markets have created a new breed of economic actors that operate beyond the reach of traditional regulation. These entities often prioritize short-term profits over long-term stability,...
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