IS TODAY’S GLOBALISATION DIFFERENT
FROM WHAT HAS GONE BEFORE?
Martin Wolf1
Is the globalisation of today really different from anything that has gone before and, if so,
in what way? Even well-informed contemporary observers assume that today’s
globalisation is quite new. The purpose of the present paper is to assess how far – and in
what way - this is true.
In an excellent discussion of globalisation and global governance, Vincent Cable, former
chief economist of Shell and head of the international economics programme of London’s
Royal Institute of International Affairs and now a Liberal Democrat member of
parliament, argues (1999, 15) that:
“[W]ith all the necessary qualifications to the hyperbole about
globalisation, something important is happening: two overlapping trends
of considerable momentum.
“One is technological, the speeding up of communications. Many
communications improvements have been taking place over the last halfcentury, but the contemporary speed of change, the enlargement of
capacity for information (and capital) transmission and the proliferation of
communications media have not been experienced before.
1
Associate Editor and Chief Economics Commentator, Financial Times, London
1
“The other is a change in the policy environment: a ‘liberalisation
revolution”, a freeing up of markets and reduction in the role of
government in terms of ownership and control over production of goods
and services.”
As Figure 1 indicates, the process of integration was powerful in the 1990s, JUST as Mr
Cable argues. Moreover, this has been a continuation of post-war trends. The share of
trade in global output increased from about 7 per cent in 1950 to over 20 per cent by the
mid-1990s. Between 1950 and 1998, the volume of world production rose by 530 per
cent and of world output of manufactures by 820 per cent. Over the same period, the
volume of world merchandise exports rose by 1,840 per cent and the volume of world
exports of manufactures by 3,500 per cent.
The history of globalisation
It is easy to assume that what we experience today is unprecedented, as Mr Cable himself
does. But globalisation itself is certainly not new. It has been a dominant theme of the
history of the past five hundred years. It can be said to have begun with the voyages of
European discovery of the 15th and 16th centuries. In the last decade of the 15th century,
Christopher Columbus reached the Americas and the Portuguese entered the Indian
Ocean. Since then peoples that had been previously been isolated have become
increasingly closely interconnected. This has been true of relations among the
civilisations of the Eurasian land-mass. It has been still truer of relations between Eurasia
2
and the hitherto largely - or entirely - isolated continents of Africa, the Americas and
Australasia. Humanity has become aware both of itself and of the globe, as a whole.2
This process of growing interconnection began when a number of peripheral European
countries – Portugal, Spain, the Netherlands, Britain and France - exploited their superior
military organisation and technology, partly developed in intra-European conflict, to
achieve control over much of the world. From the beginning, they sought wealth through
plunder and trade.
Out of their quest came great empires. In the long run, commerce proved more enduring
and more fruitful: empires came and then went, as the costs of control rose and the
rewards fell; but trade and investment remained. The ultimate result was the
incorporation of much of the world into an economic system whose centre was, until the
20th century, Europe, then Europe and North America, and today, though dominated by
the west, includes advanced east Asian countries, particularly Japan.3
The one-way arrow of technology
Globalisation then is a long-term historical process, not something that began yesterday.
Behind it have been huge and progressive declines in the costs of transport and
communications. Without the advances of the worlds of sails and of steam, of aircraft and
the motor vehicle, of the telegraph, the telephone, the satellite and the Internet, global
2
Jared Diamond (1997) provides a brilliant explanation of why ecological advantages gave the inhabitants
of the Eurasian land mass a decisive advantage over inhabitants of other continents in the development of
sophisticated economies and states. Maddison (2001, 23) discusses the technological advances that gave the
European powers mastery of the sea.
3
integration could never have happened. Before the modern age, the world’s most
important global trading route was probably the Silk Road. By the standards of what
followed, the communication and commerce this facilitated was a brook to the Amazon.
The fall in costs of transport and communications is a consequence, as well as a cause, of
market-led integration. In the economic jargon, it is “endogenous”. Science and
technology have developed in response to economic opportunities and have then, in turn,
created new ones. This was true of the Portuguese advances in navigation of the 15th
century, just as it was of the telecommunications revolution of the late 20th. These
economic forces have, in turn, been strongly influenced by the ambitions of governments.
China’s decision to turn away from inter-continental trade while Europe was turning
towards it ensured a half-millennium of western technological as well as economic
domination.4
While transport and communications technologies improved substantially from the 15th to
the 18th centuries, developments in the 19th and 20th were far more rapid and dramatic.
Just as the rate of growth of the world economy accelerated sharply in the 19th century, so
did the rate of decline in costs of transport and communications. Indeed, it is difficult to
think of the industrial revolution except in terms of transport and communications. The
steam train, the steam ship and the intercontinental telegraph cable are as symbolic of
3
William H McNeill (1982) argues that the last millennium as a whole and the second part of the
millennium, in particular, was the period when market processes remade the world, in alliance with the
increasingly powerful states that growing wealth and improving technology brought forth.
4
William H. McNeill (1982, 42-48) discusses the growth of the Chinese navy and its subsequent
abandonment in the 15th century. From 1371 to 1567, sailing to foreign lands was forbidden by the imperial
court.
4
progress in the 19th century as the motor car, telephones, radio, aircraft, television and the
internet are of the 20th.
There were substantial and continuing reductions in costs of transport and
communications throughout the 19th and early 20th centuries (Figure 2). Harley (1980)
estimates that the cost of shipping a bushel of wheat from New York to Liverpool was
halved between 1830 and 1880 and then halved again between 1880 and 1914. The first
transatlantic cable was laid in 1866. By the turn of the century, the world was cabled,
reducing communication times from months to minutes.
There were huge further improvements in technology and concomitant reductions in the
costs of transport and communications in the 20th century (see Figure 3). The cost of a
three-minute telephone call from New York to London fell from about $250 in 1930 to a
few cents today in current prices (Cairncross 1997). The number of voice paths across the
Atlantic has risen from 100,000 in 1986 to over 2m today. The number of Internet hosts
has risen from 5,000 in 1986 to perhaps 100m now. The implication is that the potential
for the international flow of information, in particular, and so for the integration of
production, sales and finance across borders has grown consistently and rapidly – and by
orders of magnitude - over the past two centuries.
Ups and downs of globalisation
If technology were the only force driving globalisation, we would have seen a continuous
advance over the past two centuries. In fact, we have not. The story is intriguingly
different. There was a large increase in economic globalisation in the 19th century,
reaching its peak in the Edwardian age. Then, with the two world wars and the Great
5
Depression, came a massive relapse. This was then followed by another rise in
globalisation – or, more prosaically, international economic integration - over the past
half century.
Trade
First, as is shown in Table 1, ratios of trade to GDP in money terms reached high levels
for several of the then advanced economies by 1910, before collapsing in the malign
environment of the great depression and the Second World War. For almost all of the
advanced countries (the most significant exception being Japan) trade ratios are now
somewhat higher than ever before. But they are not all that much higher. Among the big
countries, the most important exception to the general rule that openness is not vastly
greater today than a century ago is the United States, with a trade ratio of 11 per cent in
1910 and 24 per cent in 1995. That may explain the relatively greater controversy about
globalisation in that country. A similar case is Italy, with a trade ratio of 28 per cent in
1910 and 49 per cent in 1995.
The evidence for trade in money terms (or current prices) is somewhat misleading,
however, as is shown by the data in constant prices in Table 2. These data confirm the
picture of a decline in trade intensity between 1913 and 1950. But it shows the world
much more integrated at the end of the 20th century than it had been at the beginning. The
explanation for this is the progressive decline in the relative prices of tradable goods,
particularly manufactures, where much of the productivity growth of the century was
concentrated. The picture of dynamism of world trade ever since the second world war,
exceeding even that of the pre-first-world war period, is reinforced by Table 3.
6
The overall conclusion on trade then is that the world is more integrated today than ever
before, after a collapse in the first half of the 20th century. This conclusion is reinforced
when one takes into account the composition of world trade, with a very high level of
intra-industry trade in manufactures, as production processes have been integrated across
the globe.
Capital
Second, capital market integration was already highly advanced in the late 19 th century,
before collapsing in the inter-war period. As a share of gross domestic product the capital
outflow from the UK – at an average of 4.6 per cent of GDP between 1870 and 1913 has no contemporary parallels among the larger economies, even Japan (see Table 4). At
its peak, British overseas investment ran at 9 per cent of GDP (Bordo, Eichengreen and
Kim 1998, 4). The same was true for the capital importers. Argentina, for example, ran a
current account deficit averaging 18.7 per cent of GDP between 1870 and 1889 and 6.2
per cent of GDP between 1890 and 1913 (Baldwin and Martin, 8). More revealing
perhaps, the correlation between domestic investment and savings – a measure of selfsufficiency in savings was lower between 1880 and 1910 than in any subsequent period,
up to 1990 (See Figure 4). A related point is made in Figure 5, which shows that the gross
value of the foreign capital stock in today’s developing countries is lower today, as a
share of the recipients’ GDP than it was in 1914. This reflects the slow recovery of such
investment in developing countries after the collapse in the first half of the 20th century.
This is partly explained by the deliberate refusal of most newly independent countries to
accept inward investment in the early years of independence.
7
The composition of capital flows has also changed. Capital mobility is today much
greater for short-term instruments than it was in the earlier period. This is well
demonstrated by the turnover of the foreign exchange market, at several hundred trillion
dollars a year. Nothing similar has happened before, which explains the huge rise in
foreign assets as a share of world GDP over the past two decades (see Table 5).
Moreover, the composition of long-term flows was also somewhat different in the earlier
period from today’s (Bordo, Eichengreen and Kim 1998, 16-18): investment was more in
tangible assets than in intangible ones; by far the greater part of the earlier flows took the
form of bonds, while today stocks and bonds are of roughly equal importance; portfolio
flows predominated over direct investment in the earlier period, while direct investment
has greatly exceeded portfolio investment since the Second World War; and, finally,
before 1914 direct investment was largely undertaken by free-standing companies,
particularly in mining and transportation, while today multi-national companies
predominate, with a very large proportion of their investment in services (Baldwin and
Martin 1999, 19).
On balance, however, it is difficult to argue that overall capital mobility is much greater
today than it was a century ago, even though there have been big changes in its
composition.
People
Third, Hirst and Thompson (1999, 23) note that “the greatest era for recorded voluntary
mass migration was the century after 1815. Around 60m people left Europe for the
Americas, Oceania, and South and East Africa. An estimated 10m voluntarily migrated
from Russia to Central Asia and Siberia. A million went from Southern Europe to North
8
America. About 12m Chinese and 6m Japanese left their homelands and emigrated to east
and South Asia. One and a half million left India for South East Asia and South and West
Africa.”
Baldwin and Martin (1999, 19) note that during the 1890s, a high point for population
movement, the inflows of people into the US were equal to 9 per cent of the initial
population – equivalent to an immigration of 25m today (see Table 6). In Argentina, the
comparable figure was 26 per cent; in Australia, it was 17 per cent. In the same decade,
the UK’s outflow was 5 per cent of the initial population, Spain’s was 6 per cent and
Sweden’s was 7 per cent. In the 1990s, however, the US was the only country in the
world with a high immigration rate – equal to about 4 per cent of the initial population
over the decade.
Assessment
Thus, for all the changes that have occurred over the course of a century, neither the
markets for goods and services nor those for factors of production are significantly more
integrated today than they were a century earlier: they seem to be somewhat more
integrated for trade than they were, at least in the advanced countries (though not yet in
most developing countries), no more integrated for capital, despite the important changes
in the composition of capital flows, and far less integrated for labour.
Role of policy
If technology has consistently increased the potential for global exchange, but that is not,
in fact, what has happened an explanation must be found in policy. Globalisation is, it
9
appears, chosen more than it is destined. So what has happened to trade policy, policy
towards capital mobility and controls on movements of people over the past century?
Trade
In trade policy, 19th century liberalisation diffused from the United Kingdom to the
continent between 1846 and 1870. However, protectionism returned to continental
Europe after 1878 and never left the United States (see Table 7). There has again been
substantial liberalisation throughout the world over the past two decades. This followed a
long period, after the Second World War, when the advanced countries liberalised their
trade barriers, while the developing countries and members of the socialist bloc did not.
By the early 1980s, however, acceptance of the superiority of liberal trade over
protectionism had become global. By the late-1990s, no significant country had a
government with a commitment to protection as a principle. Exceptions are pariah states,
such as North Korea and Iraq. The liberalisation that occurred in China, India and the
countries of the former Soviet Union, in the course of the 1990s, was a powerful indicator
of this change in opinion. Today, high protection of merchandise trade is largely
restricted to manufactures in developing countries and agricultural commodities in the
advanced countries, though protection of services, particularly financial services also
remains high in many developing countries
Capital
Capital markets were open in the 19th and early 20th centuries, partly because
governments did not have the means to control capital flows, even if they had wished to
do so. Controls over capital flows were then introduced (and, with ups and downs,
10
intensified) between 1914 and 1945. Liberalisation of capital flows commenced in a
restricted number of advanced countries during the 1950s and 1960s. However, the big
wave of liberalisation began in the late 1970s, spreading across the high-income
countries, much of the developing world and the former communist countries.
Notwithstanding a very large number of financial crises over this period, this trend has
remained intact.5 Developing countries that tried desperately to keep private foreign
capital out of their economies two decades ago are now trying, as desperately, to draw it
back in.
People
While trade and some capital flows are arguably more liberally treated and bigger in
relation to global economic activity, the reverse is unquestionably true for movement of
people. All the high-income countries operate controls on immigration that vary between
tight and very tight. The mass mobility of people is largely in the form of refugees
moving among (or even within) relatively poor countries. An exception is the movement
(largely illegal) of Mexicans into the United States.
Nevertheless, there has been some important liberalisation of movement of people among
high-income countries. The most important example is the liberalisation that has occurred
within the European Union, where movement of people is one of the four freedoms
guaranteed by the founding treaties.
5
Financial crises were also common in the pre-1914 period. But the recent ones seem to have been more
destructive, probably because of the impact of collapsing exchange rates (Bordo, Eichengreen and Irwin
1999, 53).
11
Assessment
If we are to understand the apparently limited increase in the extent of globalisation – but
rather the ups and downs of a century – we must look at policy. The reaction to the
disasters of the first half of the 20th century was to close down international economic
interdependence. Then in the second half, there was a steady opening of barriers to
movement of goods, services and capital, though far less so of people. What has
happened reflects this pattern of liberalisation.
Novelties of today’s globalisation
It would be wrong, however, to see the world as having gone through nothing more than
a long cycle of first closing and then re-opening economies. Mr Cable is right in
important respects. First and perhaps most important in the long run, technology does
offer opportunities for integration never seen before. Second, other changes have also
occurred that make today’s world of globalisation different from the late 19th century in
certain important respects.
The decline and fall of world money
The first difference is negative for globalisation – namely the loss of the stability and
predictability inherent in the move from the gold standard of the 1870-1914 era to the
generalised floating of today. As Table 8 shows, international monetary history has been
extraordinarily complex, as governments have struggled to cope with the international
implications of the post-first world war move to managed money. The gold standard
seems to have been exceptionally successful in encouraging long-term capital flows,
12
particularly bond finance. Moreover, the vast scale of short-term finance is probably both
a consequence of exchange-rate instability and an important contributory cause.
Rise of the multi-national company
The second difference is positive for globalisation: it is the dominant role of multinational companies in organising today’s structure of production and exchange (see Table
9). The rise of the multi-national company in manufacturing and services reflects several
important economic changes of the past century.
One is the rise of the corporation itself – an organisational form that was still relatively
new in the 19th century. Another is the need of all countries for access to the
technological know how and markets controlled by big corporations. Yet another is the
ability of corporations to exploit modern communications and production technology to
organise the chain of production within the firm, but across frontiers. A well-known byproduct has been the universal increase in intra-industry trade. The incentive for
organising such chains of production has also been increased by the growth in wage gaps
among countries across the last century.
Rise of global institutions
A third novelty is also positive for globalisation: it is the rise of global institutions. Just as
multi-national companies organise private exchange, so international institutions organise
and discipline the international face of national policy. The World Trade Organisation,
the International Monetary Fund, the World Bank, the European Union, the North
American Free Trade Arrangement and so forth underpin habits of co-operation among
13
states and consolidate commitments to liberalise. The 19th century was a world of
unilateral policy. The late 20th was, by comparison, a world of multilateral policy.
Rise of the welfare state
The final big difference is perhaps neutral for globalisation: it is the changing role of the
state between today and a century ago. The rising regulatory and welfare role of the state
is probably somewhat hostile to globalisation, since it implies an increasingly exclusive
concern with the welfare of citizens that has accompanied democracy. Public spending
has, on average, quadrupled as a share of GDP in advanced countries, from 12 per cent in
1913 to 46 per cent in the 1990s. At the same time, there has been a relative decline in the
importance of the “warfare state”, which probably increases the ability of states, at least
democratic ones, to co-operate with one another. But just as the old liberal order was
brought down by the clash between international integration and nationalism, so does the
same threat exist today, if to a different and more limited extent.
Conclusions
1. Cost of transport and communications fell fast in the 19th century and continued to
fall further in the 20th century. The potential for rewarding international exchange has
grown correspondingly, as protagonists of globalisation argue.
2. Yet, there has been no linear relationship between these technological developments
and global economic integration. On the contrary, despite continued falls in costs of
transport and communications in the first half of the 20th century, integration went
into reverse, in all respects: trade, the movement of people and the movement of
14
capital all became less free. A new era of globalisation began with the liberalisation
of the postwar era and accelerated, while becoming increasingly global, in the 1980s
and 1990s. But this did not include the movement of people, to anything like the
extent of the late 19th century.
3. The level of economic integration today is both different from that of a century ago
and further advanced in important respects, notably in trade and in the scale of gross
capital movements. However, it is difficult to accept that it is totally different in
nature.
4. There have been some fundamental changes, mostly favourable to sustained
integration, since the late 19th century. These changes are political, organisational and
technological
5. Policy and the institutions that underpin it have been the principal determinant of the
extent and pace of integration. Globalisation is not pre-destined, but chosen.
Correspondingly, states, far from being at the mercy of omnipotent forces of
globalisation, are free to choose whether or not to open their economies to the rest of
the world.
6. Last but not least, all the periods of rapid economic growth have been accompanied
by increased integration (Table 10). Whether the next two or three decades are
successful for the population of the globe will depend both on how far integration
proceeds and on how well it is managed.
15
REFERENCES
Bairoch, Paul. 1989. “European Trade Policy, 1815-1914,” in P.Mathias and S. Pollard
(eds). Cambridge Economic History of Europe, Volume VII. Cambridge, Cambridge
University Press.
Baldwin, Richard and Philippe Martin. January 1999. “Two Waves of Globalisation:
Superficial Similarities, Fundamental Differences.” National Bureau of Economic
Research Working Paper 6904.
Bordo, Michael D, Barry Eichengreen and Jongwoo Kim. September 1998. “Was there
Really an Earlier Period of Inernational Financial Integration Comparable to Today’s?”
National Bureau of Economic Research Working Paper 6738.
Bordo, Michael D, Barry Eichengreen and Douglas Irwin. 1999. “Is Globalization Today
Really Different than Globalization a Hundred Years Ago?” National Bureau of
Economic Research Working Paper 7195.
Cable, Vincent. 1999. Globalisation and Global Governance. Royal Institute of
International Affairs, London.
Cairncross, Frances. 1997. The Death of Distance. Orion, London.
Crafts, Nicholas. Globalisation and Growth in the Twentieth Century. 2000. IMF
Working Paper WP/00/44. Washington D.C., International Monetary Fund.
Diamond, Jared. 1997. Guns, Germs and Steel: the Fate of Human Societies. W.W.
Norton & Company, New York and London.
Green, A and M. Urquhart. 1976. “Factor and commodity flows in the international
economy of 1817-1914.” Journal of World Economic History, 36, pp. 217-252.
Harley. C. 1980. “Transportation, the world wheat trade and the Kuznets cycle, 18501913,” Explorations in Economic History, 17, pp. 218-250.
Hirst, Paul and Grahame Thompson. 1999. Globalization in Question: the International
Economy and the Possibilities of Governance, 2nd edition. Polity Press, Cambridge.
16
McNeill, William H. 1982. The Pursuit of Power: Technology, Armed Force, and Society
since A.D. 1000. The University of Chicago Press, Chicago.
Maddison, Angus. 2001. The World Economy: a Millennial Perspective. OECD
Development Centre, Paris.
Taylor, A. 1996. “International Capital Mobility in History: the Savings-Investment
Relationship.” Working Paper 5743. National Bureau of Economic Research Working
Paper 5743.
United Nations. 2000. World Investment Report. UN, New York and Geneva.
17
FIGURE 1
INTEGRATION OF THE WORLD ECONOMY IN THE
1990s
Monthly Growth Rate
25.0%
20%
20.0%
15%
15.0%
10.0%
7.0%
6.0%
5.0%
3.6%
0.0%
World Output World Trade in World Trade in Foreign Direct
Goods
Services
Investment
Internet
Connections
Source: WTO
18
FIGURE 2
TRANSPORT COSTS, 1830-1910
Source: Bairoch (1989)
100
90
80
70
60
50
40
30
20
10
0
1830
1850
Wheat
Bar Iron
1880
Iron Goods
Cotton thread
1910
19
Cotton Textile
FIGURE 3
TRANSPORTATION VERSUS COMMUNICATION COSTS, 1920-1950
120
100
80
60
40
20
0
1920
Source: World Bank
1930
1940
Ocean freight
1950
Air
1969
1970
Transatlantic phone
1980
Satellite
1990
20
FIGURE 4
CORRELATION BETWEEN DOMESTIC INVESTMENT AND SAVINGS SINCE
1870
Source: Taylor (1996)
1.2
1.0
0.8
0.6
0.4
0.2
0.0
1870-79 1880-89 1890-99 1900-09 1910-19 1920-29 1930-39 1940-49 1950-59 1960-69 1970-79
21 1980-89
FIGURE 5
GROSS VALUE OF FOREIGN CAPITAL STOCK IN
DEVELOPING COUNTRIES OF AFRICA, ASIA AND
LATIN AMERICA, 1870-1998
$3,500.0
35.0%
$3,030.7
$3,000.0
30.0%
$2,500.0
25.0%
Source: Maddison (2001)
$2,000.0
20.0%
$1,500.0
15.0%
$1,000.0
10.0%
$495.2
$500.0
5.0%
$235.4
$63.2
$40.1
$0.0
0.0%
1870
1914
1950
1973
1998
Stock in 1990 prices ($bn)
Stock as share of developing country GDP
22
TABLE 1
TOTAL TRADE TO GDP
(current prices, per cent)
1870
1910
1950
1995
UK
41
44
30
57
France
33
35
23
43
Germany
37
38
27
46
Italy
21
28
21
49
Denmark
52
69
53
64
US
14
11
9
24
Canada
30
30
37
71
Japan
10
30
19
17
Source: Baldwin and Martin (1999)
23
TABLE 2
TOTAL TRADE TO GDP
(constant prices, per cent)
Region
1870
1913
1950
1973
1998
Western Europe
8.8
14.1
8.7
18.7
35.8
Western Offshoots
3.3
4.7
3.8
6.3
12.7
Eastern Europe
1.6
2.5
2.1
6.2
13.2
Latin America
9.7
9.0
6.0
4.7
9.7
Asia
1.7
3.4
4.2
9.6
12.6
Africa
5.8
20
15.1
18.4
14.8
World
4.6
7.9
5.5
10.5
17.2
and former USSR
Source: Maddison (2001)
24
TABLE 3
GROWTH IN VOLUME OF MERCHANDISE EXPORTS,
WORLD AND MAJOR REGIONS, 1870-1998
(annual average compound growth rates, per cent)
Region
1870-1913
1913-50
1950-73
1973-98
Western Europe
3.24
-0.14
8.38
4.79
Western Offshoots
4.71
2.27
6.26
5.92
Eastern Europe
3.37
1.43
9.81
2.52
Latin America
3.29
2.29
4.28
6.03
Asia
2.79
1.64
9.97
5.95
Africa
4.37
1.90
5.34
1.87
World
3.4
0.90
7.88
5.07
and former USSR
Source: Maddison (2001)
25
TABLE 4
CAPITAL FLOWS SINCE 1870
(average absolute value of current account as per cent of GDP)
UK
USA
Argentina
Australia
Canada
France
Germany
Italy
Japan
18701889
4.6
0.7
18.7
8.2
7.0
2.4
1.7
1.2
0.6
18901913
4.6
1.0
6.2
4.1
7.0
1.3
1.5
1.8
2.4
19191926
2.7
1.7
4.9
4.2
2.5
2.8
2.4
4.2
2.1
19271931
1.9
0.7
3.7
5.9
2.7
1.4
2.0
1.5
0.6
19321939
1.1`
0.4
1.6
1.7
2.6
1.0
0.6
0.7
1.0
19471959
1.2
0.6
2.3
3.4
2.3
1.5
2.0
1.4
1.3
19601973
0.8
0.5
1.0
2.3
1.2
0.6
1.0
2.1
1.0
19741989
1.5
1.4
1.9
3.6
1.7
0.8
2.1
1.3
1.8
19891996
2.6
1.2
2.0
4.5
4.0
0.7
2.7
1.6
2.1
Source: Taylor (1996)
26
TABLE 5
FOREIGN ASSETS OVER WORLD GDP (per cent)
1870
6.9
1900
18.6
1914
17.5
1930
8.4
1945
4.9
1960
6.4
1980
17.7
1995
56.8
Source: Crafts (2000)
27
TABLE 6
DECADAL MIGRATION
(per cent of initial population, 1880-1910)
Per cent of initial
populations
1880s
1890s
1900s
Senders
UK
-3.05
-5.2
-2.04
Italy
-1.65
-3.37
-4.87
Spain
-1.51
-6.01
-5.18
Sweden
-2.90
-7.20
-3.51
Portugal
-3.52
-4.16
-5.94
US
5.69
8.94
4.02
Canada
2.27
4.89
3.71
Australia
11.28
16.59
0.77
Argentina
4.50
25.60
9.50
Brazil
1.98
3.82
8.44
53.52
4.08
4.15
Receivers
N.Zealand
Source: Green & Urquhart (1976)
28
TABLE 7
AVERAGE TARIFFS ON IMPORTED MANUFACTURED GOODS
(per cent)
1875
1913
1931
1950
PreUruguay
Round
PostUruguay
Round
12-15
20
30
18
--
--
Germany
4-6
17
21
26
--
--
Italy
8-10
18
46
25
--
--
UK
0
0
n.a.
23
--
--
EU
--
--
--
--
5.7
3.6
US
40-50
44
48
14
4.6
3.0
France
Source: Bordo, Eichengreen and Irwin (1999)
29
TABLE 8
HISTORY OF MONETARY AND EXCHANGE-RATE REGIMES
REGIME
PERIOD
I. International Gold Standard
1879-1914
II. Interwar instability
1918-1939

Floating

1918-1925

Return to gold

1925-1931

Return to Floating

1931-1939
III. Semi-fixed rate dollar standard
1945-1971

Establishing convertibility

1945-1958

Bretton Woods system proper

1958-1971
IV. Floating rate dollar standard
1971-1984

Failure to agree

1971-1974

Return to floating

1974-1984
V. EMS and greater D-Mark zone
1979-1993
VI. Plaza-Louvre intervention accords
1985-1993
VII. Towards Renewed Floating and Emu
1993-

Broad multilateral surveillance

1993-1997

End of dollar pegs

1997-

Monetary union in the EU

1999-
Source: Hirst and Thompson (1999, 33)
30
TABLE 9
RISE AND RISE OF MULTI-NATIONAL COMPANIES
(Selected Indicators of FDI and International Production –
billions of dollars and percentages)
1982
FDI inward stock
1990
1999
594
1,761
4,772
2,462
5,503
13,564
Gross product of
foreign affiliates
565
1,419
3,045
Exports of foreign
affiliates
637
1,165
3,167
GDP at factor cost
10,611
21,473
30,061
Exports of goods
and non-factor
services
2,041
4,173
6,892
Sales of foreign
affiliates
Source: UN (2000)
31
TABLE 10
PERFORMANCE IN THE THREE MOST SUCCESSFUL PHASES
IN THE CAPITALIST EPOCH
(annual average compound growth rate of GDP per head)
1950-73
1973-98
1870-1913
Golden Age
Neo-Liberal Order
Liberal Order
Western Europe
4.08
1.78
1.32
Western Offshoots
2.44
1.94
1.81
Japan
8.05
2.34
1.48
Resurgent Asia
2.61
4.18
0.38
Advanced capitalist
2.93
1.91
1.36
Faltering Economies
2.94
-0.21
1.16
World
2.93
1.33
1.30
and resurgent Asia
Source: Maddison (2001)
32