Dani Rodrik

Opinion | Can world tackle climate crisis, boost middle class and cut poverty?

It may be impossible to simultaneously combat all three issues under current policy trajectories. It’s time for new policies that put these trade-offs behind us

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Pedal boats are seen on the bed of a dried out lake in the village of Comana, Romania, on September 7. The EU’s Copernicus Climate Change Service has warned that it is “increasingly likely” 2024 will be the hottest year on record. Photo: AFP

Dani Rodrik

Published: 2:30pm, 10 Sep 2024

I wrote a speculative article in 2000 on what I called “the political trilemma of the world economy”. My claim was that advanced forms of globalisation, the nation-state and mass politics could not coexist. Societies would eventually settle on, at most, two out of three.

I suggested that it would be the nation-state that would give way in the long run, but not without a struggle. In the short term, the more likely consequence was that governments would seek to reassert national sovereignty to address the distributive and governance challenges posed by globalisation.

To my surprise, the trilemma proved to have long legs. My book, The Globalisation Paradox, published a decade later, developed the idea further. The concept of the trilemma has become a handy way to understand the backlash against hyper-globalisation, Britain’s exit from the European Union, the rise of the far-right and the future of democracy in the European Union, among other issues.

Lately, another trilemma has preoccupied me. This one is the disturbing possibility that it may be impossible simultaneously to combat climate change, boost the middle class in advanced economies and reduce global poverty. Under current policy trajectories, any combination of two goals appears to come at the expense of the third.

During the early post-war decades, policies in the developed and developing world alike emphasised economic growth and domestic social stability. The advanced economies built extensive welfare states but also progressively opened their markets to poorer countries’ exports, so long as the distributional and social consequences were manageable.