Location: Jack Morton Auditorium
A growing gap in economic opportunity has brought inequality to the center of the global political debate. How can policymakers facilitate adjustment and adaptation of the workforce to rapid globalization and technological change? What is the best way to reward innovation and skills to ensure the gains from technology and globalization are shared more broadly? What has worked to narrow the gap, and what should be the focus of new policies to promote equality?
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Martin Wolf, FT
Martin Wolf is chief economics commentator at the Financial Times, London. He was awarded the CBE (Commander of the British Empire) in 2000 “for services to financial journalism.” Mr. Wolf is an honorary fellow of Nuffield College, Oxford, honorary fellow of Corpus Christi College, Oxford University, an honorary fellow of the Oxford Institute for Economic Policy (Oxonia), and an honorary professor at the University of Nottingham.
Tao Zhang, Deputy Managing Director, IMF
Tao Zhang is Deputy Managing Director of the IMF. He was Deputy Governor of the People's Bank of China (PBOC) prior to joining the Fund Over the course of his career, he has held various senior positions at the PBOC, including as Director General of the Legal Affairs Department, Director General of the Department of Financial Survey and Statistics, and Director General of the International Department. He also served as Executive Director for China at the IMF.
Mauricio Cárdenas, Minister of Finance, Colombia
Mauricio Cárdenas is Colombia's Minister of Finance and Public Credit, and former Minister of Mines and Energy. From 2008 to 2011, he was a Senior Fellow and Director of the Latin America Initiative at the Brookings Institution. He has also served as Colombia’s Minister of Economic Development, Minister of Transport, and Director of the National Planning Department.
David Mark Rubenstein, Co-Founder and Co-Chief Executive Officer, The Carlyle Group
David Mark Rubenstein is an American financier and philanthropist best known as co-founder and co-chief executive officer of The Carlyle Group, a global private equity investment company based in Washington, D.C. He is also currently serving as chairman of the Kennedy Center for the Performing Arts and chairman of the board of trustees at Duke University, his alma mater.
Tharman Shanmugaratnam, Deputy Prime Minister of Singapore
Tharman Shanmugaratnam has served as Deputy Prime Minister in the Singapore Cabinet since May 2011. He was also appointed Coordinating Minister for Economic and Social Policies in October 2015. He served as Minister for Finance from 2007- 2015 and Minister for Education from 2003-2008. He is also Chairman of the Monetary Authority of Singapore (MAS), Singapore’s central bank and financial regulator. He was Chairman of the IMFC, the policy steering committee of the IMF, from 2011-2015, and was its first Asian chair.
Laura Tyson, Professor, Haas School of Business, University of California, Berkley
Laura Tyson is a professor at the Haas School of Business at the University of California, Berkeley. She served as Dean of London Business School from 2002-2006 and as Dean of Berkeley-Haas from 1998-2001. Tyson was a member of the U.S. Department of State Foreign Affairs Policy Board and a member of President Obama’s Council of Jobs and Competitiveness and the President’s Economic Recovery Advisory Board. She served in the Clinton Administration as the Chair of the Council of Economic Advisers (1993-1995) and as Director of the National Economic Council (1995 – 1996).
Contributor: Luigi Briamonte
A growing gap in economic opportunity has brought inequality to the center of the global political debate. Panelists discussed positive and side effects of globalization and the possible policies to facilitate adaptation of the workforce to the effects of globalization in order to ensure that gains are shared more broadly. They also stressed the importance of promoting equality and narrowing the gap of opportunity for those left behind.
- While globalization has had an overall positive effect on the world economy, some side effects are emerging. Panelists agreed that globalization has allowed per-capita incomes and living standards in emerging and developing economies to begin to converge towards those of advanced economies. However, some adverse effects are emerging. Tyson pointed out how income stagnation for the majority of households in many countries, including in the US, has affected negatively aggregate demand and the supply side with lower productivity as an outcome of lower education opportunities for the middle-class. Shanmugaratnam and Rubenstein underlined that low social mobility observed in the last decades has made new generations unsatisfied with their living standard. Cardenas observed that progress to reduce inequality in emerging markets has been slow, despite the per-capita - Therefore, policies are needed to ensure that gains from technology and globalization are shared more broadly. Zhang explained that the IMF has conducted analysis on the impact of income distribution on growth and now the Fund will advise its membership on re-distributive fiscal policies, on financial inclusion measures and on structural reforms to reduce inequality, including labor markets, education and health sector reforms. Cardenas was of the view that re-distributive policies are key to reduce inequality, provided that scarce resources are used in the most effective social programs.
- Furthermore, measures to facilitate adjustment and adaptation of the workforce to rapid globalization and technological change are essential. Tyson highlighted that globalization and technological change has modified the economic structure in many countries and social programs need to accompany workers from one job to another while social protection should be extended to new forms of jobs and the tax burden reduced on labor. Shanmugaratnam, Tyson and Zhang agreed on the importance of active labor policies, including training, and that they need to be implemented to provide workers the knowledge and skills to cope with technological changes and an evolving economic structure.
“If we think about globalization, it has been a huge “plus” for humanity. It has been the way in which large groups of people living in emerging countries have begun to converge towards the achievements of advanced countries, and the process is still continuing” Tharman Shanmugaratnam, Deputy Prime Minister in the Singapore Cabinet
“Growth has allowed low income segments of the population in Latin America to improve their living standard, but if one measures inequality in terms of the Gini coefficient, the impact is very marginal: we are still the most unequal continent in the world” Mauricio Cárdenas, Colombia's Minister of Finance and Public Credit
“Many people in the US are not satisfied with the income inequality gap and with the social mobility gap. Increasingly people at the bottom cannot get to the top of society and that is a big social problem” David Mark Rubenstein, co-founder and co-chief executive officer of The Carlyle Group
“One way to address inequality is to have effective government intervention, essentially re-distribution” Mauricio Cárdenas, Colombia's Minister of Finance and Public Credit
“We continue our support and commitment to globalization but, on the other hand, we have to pay more attention to those who were left behind by globalization. That is an area where we have to strengthen our attention” Tao Zhang, Deputy Managing Director of the IMF
“We have to carve out very smart policies: there have been domestic policy failures in dealing with globalization, but now we need to get ready to deal also with challenges from technology changes, redesign our business models and our social contracts to deal with the new reality” Laura Tyson, Professor at the Haas School of Business at the University of California