Technological decoupling is the real deglobalisation threat
Deglobalisation is unlikely to be a “big bang” but more a creeping tide of targeted measures by individual countries, in our view. Sanctions on Russia and US-China tensions have shown that technology and the flow of knowledge are at the frontier of economic decoupling.
What you will learn:
- By using a novel modelling approach we can estimate the impact of restricting knowledge spillovers between countries on productivity and long-term growth rates.
- According to our global knowledge spillover framework, these costs are likely to be significant and fall disproportionately on emerging markets such as China and Russia, making “technological mercantilism” an effective strategy for the West.
- We estimate that the impact of limiting the flow of technology into Russia will lower its growth rate by almost 0.2ppts each year, amounting to a 1.3% cut to the level of GDP by 2030.