The Waves of Globalisation
In the last 150 years the Nordic countries have experienced three epochs characterised by greatly increased international integration: the 50 years preceding World War I, the quarter of a century after World War II, and the present time.
The First Wave
The first wave, known as the ‘Age of Exploration’, began with the Portuguese discovery of the sea route to India, in 1498, followed by the exploration of the American continent in the two subsequent centuries.
From 1860-1914 Europe and North America were strongly affected by internationalisation. The flow of goods accelerated. Capital moved relatively freely between countries. In some respects financial integration was more pronounced than it is today. Even international migration was greater than it is today. Roughly 60 million people left Europe to seek their fortunes in the New World.
Important drivers behind this wave of globalisation were both the new technology of the era that could bridge long geographical distances and the fact that many countries began to embrace liberal trade policy after years of protectionism.
From 1860-1914 Europe and North America were strongly affected by internationalisation. The flow of goods accelerated. Capital moved relatively freely between countries. In some respects financial integration was more pronounced than it is today. Even international migration was greater than it is today. Roughly 60 million people left Europe to seek their fortunes in the New World.
Important drivers behind this wave of globalisation were both the new technology of the era that could bridge long geographical distances and the fact that many countries began to embrace liberal trade policy after years of protectionism.
Source:
- http://www.nordregio.se/en/Metameny/About-Nordregio/Journal-of-Nordregio/2008/Journal-of-Nordregio-no-1-2008/The-Three-Waves-of-Globalisation/
- http://dspace.uevora.pt/rdpc/handle/10174/6168
- http://www.nordregio.se/en/Metameny/About-Nordregio/Journal-of-Nordregio/2008/Journal-of-Nordregio-no-1-2008/The-Three-Waves-of-Globalisation/
- http://dspace.uevora.pt/rdpc/handle/10174/6168
The Second Wave
The second wave took place in the XIX century, with the multiplication of international relations, much reinforced by unprecedented improvements in means of communication and transportation. By then, dozens of sophisticated stock and bond exchanges existed in many countries and financial integration attained levels comparable to those observed today.
European investors were advised to internationally diversify financial applications, and English, French, Dutch and German capital flew in torrents to finance infrastructures in Russia, Asia, Africa and America. Most of these links were broken with the First World War, and subsequent episodes such as the Russian Revolution and the Great Depression contributed to maintain some degree of suspicion over international economic relations.
International regulations and organisations to support economic integration at the global level were created after World War II. Cooperation was based on the Bretton Woods Agreement of 1944.
The USA was the leading economy in the world and the dollar became the monetary basis of the financial system. The 'Bretton Woods system' meant that nations had fixed currency exchanges in relation to the US dollar, which in turn was fixed to the gold standard.
In an important aspect, the post World War II international economy was less open than the period prior to World War I. Before World War I the international flow of capital had been free. The Bretton Woods system was based on governmental control of the international flow of capital.
Two organisations were established during this period, the World Bank (IBRD) and the International Monetary Fund (IMF). In addition a special agreement, the General Agreement on Tariffs and Trade (GATT) became operative in 1948.
European investors were advised to internationally diversify financial applications, and English, French, Dutch and German capital flew in torrents to finance infrastructures in Russia, Asia, Africa and America. Most of these links were broken with the First World War, and subsequent episodes such as the Russian Revolution and the Great Depression contributed to maintain some degree of suspicion over international economic relations.
International regulations and organisations to support economic integration at the global level were created after World War II. Cooperation was based on the Bretton Woods Agreement of 1944.
The USA was the leading economy in the world and the dollar became the monetary basis of the financial system. The 'Bretton Woods system' meant that nations had fixed currency exchanges in relation to the US dollar, which in turn was fixed to the gold standard.
In an important aspect, the post World War II international economy was less open than the period prior to World War I. Before World War I the international flow of capital had been free. The Bretton Woods system was based on governmental control of the international flow of capital.
Two organisations were established during this period, the World Bank (IBRD) and the International Monetary Fund (IMF). In addition a special agreement, the General Agreement on Tariffs and Trade (GATT) became operative in 1948.
Source:
- http://www.nordregio.se/en/Metameny/About-Nordregio/Journal-of-Nordregio/2008/Journal-of-Nordregio-no-1-2008/The-Three-Waves-of-Globalisation/
- http://dspace.uevora.pt/rdpc/handle/10174/6168
- http://www.nordregio.se/en/Metameny/About-Nordregio/Journal-of-Nordregio/2008/Journal-of-Nordregio-no-1-2008/The-Three-Waves-of-Globalisation/
- http://dspace.uevora.pt/rdpc/handle/10174/6168
The Third Wave
The third wave of globalisation did not start until much later in the XX century, fostered by the coordinated action of politicians and economists. Naturally, the globalisation phenomenon has been addressed from a variety of distinct perspectives. It was initially a matter for philosophers, concerned with the consequences of the annihilation of space, resulting from the development of the means of transportation, especially with the expansion of railways. Later, social scientists broadened the analysis and provided more comprehensive assessments of the causes and effects of increased cross border relations.
More recently, the economic perspective has gained prominence, to the point of being currently common to confound the concept of globalisation with that of economic globalisation. In economic terms, globalisation comprises the international flow of goods, services, capital and labour and has been greatly enhanced by both technological progress and a political will to overcome the barriers imposed by national boundaries. With uneven positive and negative effects across countries and societies, the globalisation of economic activities is a fertile source of new problems and challenges for decision makers, academics and practitioners. In this book, some of the new challenges posed by globalisation to different research areas of the economic science are addressed. Attention is mainly focused on the implications of free trade and financial integration, but political consequences are also examined.
The contributions of different authors have been selected from those presented and discussed at the 10th INFER International Conference, held in Évora, Portugal, coincidently close to the birth place of Vasco da Gama, the intrepid promoter of the first globalisation wave.
More recently, the economic perspective has gained prominence, to the point of being currently common to confound the concept of globalisation with that of economic globalisation. In economic terms, globalisation comprises the international flow of goods, services, capital and labour and has been greatly enhanced by both technological progress and a political will to overcome the barriers imposed by national boundaries. With uneven positive and negative effects across countries and societies, the globalisation of economic activities is a fertile source of new problems and challenges for decision makers, academics and practitioners. In this book, some of the new challenges posed by globalisation to different research areas of the economic science are addressed. Attention is mainly focused on the implications of free trade and financial integration, but political consequences are also examined.
The contributions of different authors have been selected from those presented and discussed at the 10th INFER International Conference, held in Évora, Portugal, coincidently close to the birth place of Vasco da Gama, the intrepid promoter of the first globalisation wave.
Source:
- http://dspace.uevora.pt/rdpc/handle/10174/6168
- http://dspace.uevora.pt/rdpc/handle/10174/6168