Trump Administration Risks Falling into Protectionist Trap

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In recent years, global trade growth has slowed significantly, even creeping below global GDP growth at a level that hasn’t been seen in decades. Some economists believe globalization has reached a natural upper limit.  Others argue that the data does not reflect true stagnation or that new forces driving trade growth are not showing up in the numbers. The Cipher Brief’s Fritz Lodge spoke with Caroline Freund, a senior fellow at the Peterson Institute for International Economics, about the concept of “peak trade,” and how the apparent slowdown in global trade could affect the global economy, global trade flows, and U.S. policy.

The Cipher Brief: The growth rate in trade of goods and services has leveled off in recent years compared to GDP growth. In your mind, how much credence is there to the notion of “peak trade?” Is it possible that globalization is hitting some upper limit?

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