*The Miracles of Globalization*

Foreign Affairs, September, 2004 by Arvind Panagariya

/Why Globalization Works/. Martin Wolf. New Haven: Yale University Press, 2004, 398 pp.$30.00

By the early 1980s, a number of distinguished economists had amassed compelling evidence that outward-oriented trade policies were far more likely than protectionism to lead to economic growth. The evidence was contained in two multi-country research projects-one at the Organization for Economic Cooperation and Development (OECD), led by Ian Little and others, and the other at the National Bureau of Economic Research, directed by Jagdish Bhagwati and Anne Krueger-and in a series of studies at the World Bank.

When developing countries, convinced by these findings, began to embrace outward-oriented policies, pro-free trade economists believed they had scored a...