Institutions – Moving to the Global?


Harold James

There are three major challenges that today will force a rethinking of public goods: each of them may be thought of in terms of fundamental challenges to security, personal and national. One is the existential threat of climate change, and the bizarre geopolitical consequences of that change. The second is the impact of AI on labor market practices. AI is not only an obvious threat to employment, but also a security challenge. The third related challenge is the monetary revolution that is being produced by new technologies such as blockchain, and the consequent possibility of generating non-state moneys.

Key Messages

  • Domestic (but not foreign) borrowing became cheaper after the 17th century financial revolution
  • Trilemmas present a way of weighing the losses and gains from trade-offs from capital openness
  • The policy limitations on democracy resulting from capital openness may be treated analogously
  • Limitations from the international system or order can also be treated in this manner
  • The 17th century domestic analogy suggests a need for coordinated or linked up global governance

Harold James: “Institutions – Moving to the Global?,” EconPol Forum 23 (5), CESifo, Munich, 2022.