U.S. Foreign Economic Policy After September 11th

Unquestionably, the events of September 11th have reshaped the debate over globalization. A trend that many economists characterized as irresistible suddenly appears less so. Foreign assembly operations have become less attractive to U.S. corporations now that there is the fact, or even the danger, that their trucks will be stuck in mile-long queues at the U.S.-Canada or U.S.-Mexico border. Companies like McDonald's and Starbucks, whose main opportunities for market growth are outside the United States, now must factor in extra costs of security when contemplating opening another outlet abroad. Computer programmers from India and graduate students from Pakistan will face additional hurdles when attempting to obtain temporary residency in the United States, and American companies will think twice about posting their executives abroad. Foreign trade, foreign direct investment, and international migration all will grow less quickly than they did before the terrorist attacks.All this is co...