The Contemporary Global Economy E-Book

Alfred E. Eckes

• Herausgeber: John Wiley & Sons
• Kategorie: Geisteswissenschaft
• Serie: Blackwell History of the Contemporary World
• Sprache: Englisch

Seitenzahl: 545

Veröffentlichungsjahr: 2011

Beschreibung

The Contemporary Global Economy provides a lively overview of recent turbulence in the world economy, focusing on the dynamics of globalization since the 1980s. It explains the main drivers of economic change and how we are able to discern their effects in the world today.

• A lucid and balanced survey, based on extensive research in data and documents, accessible to the non-specialist
• Written by a renowned specialist in international economic relations with academic and government credentials
• Offers clear and engaging explanations of the main motors of economic change and how we are able to discern their effects in the world today
• The author assumes little knowledge of economic theory or financial markets
• Identifies the challenges for sustainable recovery and economic growth in the years ahead

Leseprobe

Table of Contents

Cover

Table of Contents

Halftitle page

Series Page

Title page

Copyright page

Series Editor’s Preface

Preface

Abbreviations

Chapter 1 Introduction

Scope

The Contemporary Age of Globalization, 1980–2010

Conclusion

Chapter 2 The Global Economy before 1980

First Global Economy 1870–1913

De-Globalization 1914–50

Renewed Globalization (1950–70)

Globalization in a Turbulent Decade – the 1970s

Conclusion

Chapter 3 The Rich Nations

Western Europe

North America

Oceania

Conclusion

Chapter 4 The Developing World

Asia

Asia’s Tigers

Association of Southeast Asian Nations

South Asia

Latin America

The Middle East and North Africa

Sub-Saharan Africa

Central and Eastern Europe

Russian Federation

Conclusion

Chapter 5 Thinking about the Global Economy

Early Free Traders

Free-Trade Skeptics

Great Depression and Managed Economies

The Free-Market Counter-Revolution

Conflicting Currents

Conclusion

Chapter 6 International Trade

Trade Trends and Transitions

Multilateral Trade Negotiations

GATT Negotiations

WTO in Transition

Dispute Settlement

Bilateral and Regional Trade Negotiations

Conclusion

Chapter 7 Global Business

Increasing International Business Activity

Prelude to Corporate Globalism

The Challenge of Open Markets

One World?

Global Business Advocates and Activists

Business Strategists and Globalization

Adapting to the Age of Globalization

Conclusion

Chapter 8 Internationalization of Finance

Introduction to International Finance

De-Globalization and National Regulation of Finance

Second Era of Financial Deregulation

Financial Globalization in the 1990s

Conclusion

Chapter 9 The Global Financial Crisis of 2007–10

Bulls and Bears

Problems in the Making

The Collapse

The Collapse Impacts Many Countries

International Organizations and Governments Respond

Conclusion

Chapter 10 The Underside of the Global Economy

Forced Labor and Trafficking

Organized Crime

Sweatshops

Health and Safety and the Global Economy

Environment and the Global Economy

Conclusion

Chapter 11 Epilogue

Reforming Finance

Addressing Imbalances

Redistributing Power in the Global Economy

Suggestions for Further Reading

References

Index

THE CONTEMPORARY GLOBAL

ECONOMY

A HISTORY OF THE CONTEMPORARY WORLD

General Editor: Keith Robbins

This series offers an historical perspective on the development of the contemporary world. Each of the books examines a particular region or a global theme as it has evolved in the recent past. The focus is primarily on the period since the 1980s but authors provide deeper context wherever necessary. While all the volumes offer an historical framework for analysis, the books are written for an interdisciplinary audience and assume no prior knowledge on the part of readers.

Published

Contemporary Japan

Jeff Kingston

Contemporary America

M. J. Heale

The Contemporary Global Economy

Alfred E. Eckes Jr.

In Preparation

Contemporary Latin America

Robert H Holden & Rina Villars

Contemporary South Asia

David Hall Matthews

Contemporary Africa

Tom Lodge

Contemporary China

Yongnian Zheng

This edition first published 2011

© 2011 Alfred E. Eckes, Jr.

Blackwell Publishing was acquired by John Wiley & Sons in February 2007. Blackwell’s publishing program has been merged with Wiley’s global Scientific, Technical, and Medical business to form Wiley-Blackwell.

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Library of Congress Cataloging-in-Publication Data

Eckes, Alfred E., 1942–

 The contemporary global economy : a history since 1980 / Alfred E. Eckes.

p. cm. – (History of the contemporary world)

 Includes bibliographical references and index.

ISBN 978-1-4051-8344-4 (hardback) – ISBN 978-1-4051-8343-7 (pbk.) 1. International economic relations. 2. Economic history. 3. Globalization. I. Title.

 HF1359.E23 2011

 337–dc22

2011001494

A catalogue record for this book is available from the British Library.

This book is published in the following electronic formats: ePDFs [9781444396843]; ePub [9781444396850]

Series Editor’s Preface

The contemporary world frequently presents a baffling spectacle: “New world orders” come and go; “clashes of civilizations” seem imminent if not actual; “peace dividends” appear easily lost in the post; terrorism and “wars on terror” occupy the headlines. “Mature” states live alongside “failed” states in mutual apprehension. The “rules” of the international game, in these circumstances, are difficult to discern. What “international law” is, or is not, remains enduringly problematic. Certainly it is a world in which there are still frontiers, borders, and boundaries but both metaphorically and in reality they are difficult to patrol and maintain. “Asylum” occupies the headlines as populations shift across continents, driven by fear. Other migrants simply seek a better standard of living. The organs of the “international community,” though frequently invoked, look inadequate to deal with the myriad problems confronting the world. Climate change, however induced, is not susceptible to national control. Famine seems endemic in certain countries. Population pressures threaten finite resources. It is in this context that globalization, however understood, is both demonized and lauded.

Such a list of contemporary problems could be amplified in detail and almost indefinitely extended. It is a complex world, ripe for investigation in this ambitious new series of books. “Contemporary,” of course, is always difficult to define. The focus in this series is on the evolution of the world since the 1980s. As time passes, and as the volumes appear, it no longer seems sensible to equate “the world since 1945” with “contemporary history.” The legacy of the “Cold War” lingers on but it is emphatically “in the background.” The fuzziness about “the 1980s” is deliberate. No single year ever carries the same significance across the globe. Authors are therefore establishing their own precise starting points, within the overall “contemporary” framework.

The series treats the history of particular regions, countries, or continents but does so in full awareness that such histories, for all their continuing distinctiveness, can only rarely be considered apart from the history of the world as a whole. Economic, demographic, environmental, and religious issues transcend state, regional, or continental boundaries. Just as the world itself struggles to reconcile diversity and individuality with unity and common purpose, so do the authors of these volumes. The concept is challenging. Authors have been selected who sit loosely on their disciplinary identity – whether that be as historians, political scientists, or students of international relations. The task is to integrate as many aspects of contemporary life as possible in an accessible manner.

Most volumes in this series have a focus on particular countries, regions, or continents but this book “thinks globally” in expounding and explaining the dynamics of the “world economy.” It is the intensity of contemporary “globalization” which gives the period under review its special character. The scale of exchange, in one form or another, exceeds that in any other era. So too do the speed of international communication and the size of capital flows. In these circumstances, classical expositions of the “terms of trade,” conceived in earlier centuries, can seem archaic. “Free Trade,” however, continues both to have its enthusiastic champions and committed opponents. If the “world economy” can be thought of as a “system,” it appears volatile and unpredictable. It can sometimes be subjected to some degree of regulation of trade and tariffs through protracted and fraught negotiation, but only with great difficulty and fluctuating success. The economies of particular countries emerge, contract, or stagnate and upset assumptions of global hegemony (for politics is never far away). Charting a confident path through the complexity, this book distils the essence of the world economy and its workings with admirable lucidity.

Keith Robbins

Preface

In the generation after 1980, the world economy experienced both vast changes and enormous volatility. Technological advances in transportation, communications, and information-processing erased traditional barriers of time and distance. With the collapse of the Soviet bloc and the integration of China into the global trading system, four to five billion people entered the global market economy. These events opened the door to a new era of deregulated capitalism, led by the world’s only remaining superpower. The United States pushed its neo-liberal economic model involving free trade and open-markets. As a result, people and nations became better connected. Flows of trade, capital, migrants, and information accelerated. Trade agreements knocked down barriers to market access. Multinational enterprises began to treat the world as a single economy for purposes of producing and selling goods.

In this radically-transformed environment, many bulls foresaw a long boom with expanding growth and rising incomes. They envisaged billions of new capitalists and middle-class consumers. Nation-states would fade into insignificance.

As it turned out, the post-Cold War global economy was flawed. Lax lending, easy credit, untested financial instruments, inattentive regulators, and free-market ideology all combined to fuel a world-wide boom in real estate and equity markets. When the bubble burst in 2007–8, housing prices collapsed, borrowers defaulted on mortgages, hastily-made fortunes vanished in collapsing stock and bond markets, and enthusiasm for dere­gulation and trade expansion dampened. As had occurred in the 1930s, governments stepped in to reform and resuscitate markets, and attempted to rescue enterprises deemed too important to fail.

The collapse left most developed countries in bad shape, facing massive adjustments. It shook faith in the Washington consensus of free markets and lightly regulated capitalism. It appeared to bolster emerging market advocates of state-owned enterprises and vigorous government regulation. While Britain led the nineteenth-century world economy, and America the late twentieth-century world, many thought the 2007–10 economic crisis signaled another leadership transition. Developing countries, such as China, India, and other emerging giants, would play enhanced roles in the twenty-first-century order and become the new engines of global growth.

This book on the contemporary global economy endeavors to provide an historical perspective on important developments. Chapters examine broad trends, key regions and countries, the evolution of thought about the international economy, international trade and finance, the rise of transnational business, and the economic crisis of 2007–10. The book also explores the underside of globalization – including issues relating to human trafficking and sweatshops, crime and terrorism, health, and the environment. Finally, the epilogue reviews initial efforts to regulate and rebalance the global economy, and to achieve sustainable growth, at a time when emerging powers aspire to a leadership role in international economic affairs.

Abbreviations

ATA

Air Transport Association

BIS

Bank for International Settlement

ECB

European Central Bank

ICC

International Chamber of Commerce

ICFTU

International Confederation of Free Trade Unions

IFSL

International Financial Services London

ILO

International Labor Organization

IMF

International Monetary Fund

IOM

International Organization for Migration

ITU

International Telecommunication Union

MPI

Migration Policy Institute

OECD

Organization for Economic Cooperation and Development

TI

Transparency International

UNCTAD

United Nations Conference on Trade and Development

UNDESA

United Nations Department of Economic and Social Affairs

UNODC

United Nations Office on Drugs and Crime

UNWTO

United Nations World Tourism Organization

USBEA

US Department of Commerce, Bureau of Economic Analysis

USBoC

US Department of Commerce, Bureau of the Census

USCIA

US Central Intelligence Agency

USDoS

US Department of State

USEIA

US Energy Information Administration

USFRBG

US Federal Reserve, Board of Governors

USFRBSF

US Federal Reserve Bank, San Francisco

USGAO

US Government Accountability Office

USNIC

US National Intelligence Council

USTR

US Trade Representative

WEF

World Economic Forum

WFE

World Federation of Exchanges

WTO

World Trade Organization

Chapter 1

Introduction

At the beginning of the twenty-first century the typical resident of Western Europe, North America, or Oceania was increasingly cosmopolitan in consumption and outlook. He or she drove an imported car (perhaps German or Japanese), wore Chinese-made clothing, ate food products from various corners of the world as part of a daily diet, and communicated with an Asian-assembled computer or cell phone to friends or relatives all over the world. Internet e-mail, innovations like Skype, and Facebook, eased the way for exchanging information and images, and keeping up with a global network of friends and contacts. Those fortunate enough to have investment portfolios often diversified with foreign stocks or bonds. And residents of affluent nations thought little of vacationing abroad (France, Spain, North America, and China were popular destinations). Retirees opted for more leisurely travel, perhaps on one of the giant cruise ships that frequented Alaska or the Baltic in summer, or the Caribbean and Mediterranean in winter.

Four to five billion people joined the global market during the last quarter century. While local political and economic elites opted to hobnob with other elites, skiing at Davos in winter or yachting at St. Barts or Monaco in summer, many of the poor intersected the global economy differently. Some 500 million new factory workers – many of them young women – produced t-shirts, sneakers, iPhones and other products for export to consumers in other countries. Frequently, they labored 12-hour days, or longer, for low wages (perhaps the equivalent of $2 per day, or less), and had little leisure time. Many spent a portion of their meager earnings to enhance their mobility and connections to family and friends. Even in the most desolate locations, basic products like motor scooters, cell phones, and televisions expanded knowledge and widened opportunities. Hearing of better jobs in high-income countries, some entrusted their lives to professional smugglers who locked them in shipping containers, or led them on desert treks in the middle of the night, to cross borders. As millions of migrants had done in centuries past, they risked their lives to improve prospects for their families and themselves.1

While millions of people have benefitted from the contemporary global economy – particularly high-income and professional elites – not everyone has shared its prosperity. OECD studies show an increasingly skewed distribution of wealth in some countries.2 Jobless data indicate that factory workers, and their families, in high-income countries have experienced disruptions to their lives, as plants closed and jobs moved to countries with cheaper labor. In the Soviet Union, the collapse of state planning produced widespread hardship for pensioners and those unable to adapt to new circumstances. Others over-estimated their circumstances. They splurged, and took on risk and debt far in excess of their resources. As it turned out some of the greatest excesses were in government, where elected officials in many countries made fiscally irresponsible promises to win votes, and budget deficits soared.

In some ways the period from 1980 to 2010 was reminiscent of the late Victorian and Edwardian years before World War I. From about 1870 to 1914, the United Kingdom was the center of a similar world economy. It too was open to trade and finance, and imposed few restrictions on migration. As a result of submarine cables, news and information traveled rapidly. British-owned cables linked the world to London, and the Royal Navy protected maritime routes. Residents of the United Kingdom consumed the world’s products and invested their savings abroad in mines, ranches, railroads, and utilities. John Maynard Keynes, the famous British economist, recalled this extraordinary period nostalgically in (1920). Keynes marveled at the “internationalization” of economic life, noting in a famous passage from his writings how an inhabitant of London could order by telephone, while sipping his morning tea, the various products of the whole world. He could invest his wealth in natural resources and new enterprises overseas, or buy the bonds of any substantial municipality on any continent that his fancy or information might recommend.