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Noah Smith

Hate Globalization? Then Embrace Stagnation

Increased trade and rising productivity – the engine of growth -- go hand in hand.

Fighting like this won’t help.

Fighting like this won’t help.

Photographer: Mark Ralston/AFP/Getty Images

Economists traditionally have thought that long-term productivity growth is due to technological and organizational improvement. Engineers learn how to make a better car engine, businesspeople figure out how to organize their work teams more efficiently, and so on. These ideas accumulate and since little gets forgotten -- barring resource exhaustion, environmental degradation or major policy mistakes -- humanity gets richer and richer.

Since the mid-2000s, the U.S. has been experiencing a slowdown in productivity growth: