Daniel Gros, 30 June 2017

Trade liberalisation has been a significant driver of globalisation over the past half century, but global trade has slowed in recent years. This column argues that globalisation can also be driven by higher commodity prices, as commodities constitute a large fraction of global trade. This is reflected in trade volumes and commodity prices, which increased until around 2014 but have fallen since. Commodity price-driven globalisation implies lower living standards in advanced countries, as the higher commodity prices diminish the purchasing power of workers. 

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