Final answer:
Jagdish Bhagwati addresses self-interest criticism of globalization by proposing rational policy measures to manage any negative consequences, while still capitalizing on the benefits of free trade. He acknowledges the issues of trade imbalances and the impact on smaller economies but refutes the need to move away from globalization.
Step-by-step explanation:
Jagdish Bhagwati, a notable economist in defense of globalization, addresses the self-interest criticism by arguing that the potential negative aspects of free trade can be managed without restricting trade altogether. Bhagwati suggests there are ways to deal with concerns such as trade imbalances and economic instability caused by the rapid movement of international capital, which can harm smaller economies. According to Bhagwati, these issues need not lead to anti-globalization stances but rather require smart policy decisions to mitigate adverse effects while still reaping the overall benefits of globalization.
Concerns over globalization include its impact on the environment and local economies, lack of regulatory environment, and the vulnerabilities of least developed countries (LDCs) when participating in global trade due to their lack of infrastructure. Critics also worry about the protectionist policies of wealthy countries, which could disadvantage LDCs. However, proponents of globalization, like Bhagwati, uphold that trade liberalization has led to significant gains in GDP growth for developing countries since the 1990s.