Many think that globalization is a recent development, but its origins go back to the early 19th century. This fact is apparent from a new study by sociologist Christopher Chase-Dunn of the University of California at Riverside and his colleagues. Their data, which are based on the relation between imports and gross domestic product, show that the initial wave of globalization began about 1830 and peaked about 1880. During this time, international commerce, with the abandonment of mercantilism, first became a force in the lives of ordinary people. Before the 19th century, international trade was a paltry affair mostly confined to luxuries, such as spices and tobacco. This early wave is associated with the growth of railroads, more efficient ocean transport, and the political victory of manufacturing and trading interests over those of the landowners, signaled by the 1846 repeal of the British corn laws. (Those laws imposed duties on imported corn and thereby kept prices high.) The second wave coincided with the rise of electricity and steel around 1900 and peaked in the 1920s. The current wave began after World War II as a result of the creation of international institutions such as the General Agreement on Tariffs and Trade, the predecessor of the World Trade Organization.
Decreasing costs of transport and communication underlie the long-range increase in world trade, but no satisfactory reason explains the wave pattern. Chase-Dunn cites "hegemonic stability," in which a great power provides stable conditions. The first and third coincide with, respectively, the eras of British and U.S. hegemony, but, as he notes, the theory does not account for the second wave, which occurred when Britain was in relative decline and the U.S. had not yet asserted its power.
This article was originally published with the title Trade Globalization.