... this essay is just weird.
I mean, he predicts that there will be a movement to abolish nation states, not from some right-wing spectre of angry foreigners bearing down on the gates, but from citizens clamoring for more free-trade agreements, the demand for which will ... uh ... “stem from daily interactions on computer monitors with foreigners whom we can see are intelligent, decent people – people who happen, through no choice of their own, to be living in poverty. This should lead to better trade agreements, which presuppose the eventual development of orders of magnitude more social insurance to protect people within a country during the transition to a more just global economy.”
I mean, okay. Moral impulses prompted by electronic interactions with faraway poor people will lead to a popular groundswell that will both usher in an era of global free trade and increase social insurance transfers by a factor of ten. Even ignoring for a moment that OECD social spending is already at 22% of GDP and is therefore unlikely to increase to 216%, it is hard to see the theory of human behavior that causes people with sympathy for faraway poor people to demand more trade with them.
The irony? Shiller has done so much to demolish the idiocy of using some imaginary homo economicus to set policy. But now, suddenly, homo economicus is back and plotting revolution in the most off-base essay I have read in a very long time.
Filed under 2016 election for lack of a better place. After all, without the current election I would not have bothered to write this response.