## Book review: Dance of the Trillions — Robin Brooks

## Source details

**Canonical URL:** [Book review: Dance of the Trillions — Robin Brooks](https://www.imf.org/-/media/files/publications/fandd/article/2019/march/book-review-dance-of-the-trillions-brooks.pdf)

## Other formats

- [Markdown version](/-/media/files/publications/fandd/article/2019/march/book-review-dance-of-the-trillions-brooks.pdf.md)
- [Structured JSON version](/-/media/files/publications/fandd/article/2019/march/book-review-dance-of-the-trillions-brooks.pdf.json)

---

### Overview
- Reviewer: ROBIN BROOKS, managing director and chief economist, Institute of International Finance.
- Subject: David Lubin, Dance of the Trillions: Developing Countries and Global Finance.
- Scope: Traces the ebb and flow of global capital to emerging market and developing economies from the 1970s to today.
- Publication details as given: Brookings Institution Press/Chatham House, Washington, DC, and London, 2018, 154 pp., $34.99.
- Contextual reference: 2018 emerging market sell-off cited as an illustration of market turbulence.

### Major findings and analytical points
- Central role of US monetary policy:
  - US monetary policy is identified as one of the principal drivers of capital flow cycles to emerging markets.
  - The book is noted as especially pertinent given that the decade of extraordinary monetary stimulus in the world’s three leading economies is "ever so gradually, being unwound."
- Hot money and exchange-rate management:
  - The book highlights the "curse of hot money" for many emerging markets.
  - It critiques the illusion that managing exchange rates will provide stability, arguing that the opposite is often the case.
- Capital flows and vulnerabilities:
  - A decade of extraordinary monetary stimulus produced record capital flows to emerging markets and thus, perhaps, record vulnerabilities.

### Challenges for emerging markets (as identified in the review)
- Shift toward protectionism:
  - Rooted in perceptions that globalization bestowed disproportionate benefits on emerging markets at the expense of low-skilled labor in advanced economies.
- Technological progress and labor-market disruption:
  - Technological change may make low-skilled jobs increasingly obsolete.
  - Example cited: 3D printing of running shoes as a driver of production returning from emerging markets to advanced economies due to diminishing importance of wage differences.
  - Some commentators label this effect "perhaps the biggest challenge for emerging markets."
- Geopolitical and strategic shifts:
  - China’s rising influence poses questions about its future role in the world economy.
  - Recent trade tensions between the United States and China are described as symptomatic of persistent imbalances and reluctance to address them.
  - The transition from a US-centric unipolar world to a more bipolar or multipolar world raises separate issues outside the book’s scope, including implications for China and the developing world.
  - Mixed reactions to China’s Belt and Road Initiative—especially around debt and lack of knowledge transfer in recipient countries—highlight whether China’s business model may face as much, or more, scrutiny as the Washington Consensus.

### Tone and evaluation
- The reviewer praises David Lubin as a leading emerging market strategist whose calls and analysis bring insight and perspective during turbulent market periods.
- The book is described as all-encompassing and well-written in its treatment of capital flows to emerging and developing economies.

*Reviewed by ROBIN BROOKS, managing director and chief economist, Institute of International Finance; Finance & Development, March 2019.*

---


_Source: https://www.imf.org/-/media/files/publications/fandd/article/2019/march/book-review-dance-of-the-trillions-brooks.pdf_