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New Risks in a New Geopolitical Framework
Central Banking Series Global Interdependence Center Fundacion Rafael del Pino, Madrid November
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2018
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The Siege of the Liberal Order
1. The Rise of China 2. A Revisionist Russia 3. The Arab Winter
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T h e I m p l o s i o n o f t h e O r d e r f r o m Wi t h i n
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World Population and Social Development over the last Four Thousand Years Source: Morris 2010 & Brynjolfsson et al. 2014
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T h e C a u s e : Te c h n o l o g i c a l A d v a n c e m e n t 12 Disruptive Technologies
Mobile Internet
Automation of knowledge work
The internet of things
Cloud technology
Advanced robotics
Autonomous and nearautonomous vehicles
Next-generation genomics
Advanced oil and gas exploration and recovery
3D printing
Advanced materials
Energy storage
Renewable energy Source: McKinsey Global institute 2013
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The Challenges it Brings
DISRUPTION IN THE JOBS MARKET
WAGE STAGNATION AND INEQUALITY 6
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Sift in the Jobs Market AGRICULTURE
Corn Yield(bushel/acre)
Agricultural Employment (share of labor force)
Source: Goldman Sachs Global Investment Research (2016), US Department of Agriculture, IPUMS-USA, University of Minnesota
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Sift in the Jobs Market Manufacturing Sector Inflation-Adjusted Output and Employment
Source: Metropolitan Policy Program, The Brookings Institution 2016 8
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Challenge I Disruption in the Jobs Market – Services (Projections)
Source: Oxford Martin School 2015
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Challenge I Disruption in the Jobs Market – Aggregate Impact
Decoupling of Productivity and L a b o r Wa g e s Source: US Census Bureau
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Challenge II Wage Stagnation
% of Households with Flat or Falling Real Market Income, 2005-2014 Source: Financial Times & McKinsey Global Institute (“Poorer than their Parents�)
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Challenge II Inequality – Income Distribution After the Crisis
% share of income gains during economic expansion accruing the top 1% and the bottom 99% of earners
Fuente: Techerneva, 2014. Basada en cĂĄculos de Piketty y Emmanuel Saez.
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THE CONSEQUENCES
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PESSIMISM & ANTI SYSTEMIC SENTIMENT
THE BARBARIANS AT THE GATES & THE ANTI LIBERAL ERA
LOSS OF FAITH IN DEMOCRACY AS A FORM OF GOVERNMENT
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Conclusions CAUSE: STRUCTURAL CHANGE IN THE ECONOMY CONSEQUENCE: POLITICAL CONVULSION & COLLAPSE OF THE LIBERAL ORDER SOLUTION: A NEW SOCIAL CONTRACT
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Thank you!
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