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In this paper the focus is on economic aspects of globalization, i.e. the internationalization of trade with goods and services, international labour and capital movements. Globalization, internationalization and international integration are treated as synonymous concepts. We will investigate some theoretical aspects of globalization by having a look at possible economic effects of trade, labour migration and capital movements. After that some quantitative developments are presented. [ABSTRACT FROM AUTHOR]

“The Great Depression of 1929 to 1940 in the United States was the greatest event in the history of business cycles. It devastated rich and poor alike. It destroyed wealth in the billions, tossed one-quarter of the 1929 labor force onto the shoals of unemployment, evaporated the hopes and aspirations of millions, left a majority of American families near destitution for a full decade in an event that was totally unnecessary, because properly applied monetary and fiscal policy could have cured the recession in 1930/31, not a decade later in 1941.” Introduction The similarities in American economic performance between the decades of the 1920s and 1990s are tantalizing. Particularly when 1919 is aligned with 1990 and 1929 is aligned with 2000, the evolution of many key macro-variables over the intervening decade match remarkably closely. Growth in real GDP, real GDP per capita, employment, and productivity were almost identical, the conventionally measured unemployment rate was identical in 1928 and 1999, inflation was negligible (1920s) or low (1990s), and the late 1920s stock market boom is the only such episode in the century that comes close to the stock market's ebullience in the late 1990s. Like the 1990s, the 1920s witnessed prosperity, a productivity revival, low unemployment, and low inflation. Both decades featured an explosion of applications of a fundamental general-purpose technology, electricity and the internal combustion engine in the 1920s and computer hardware, software, and networking communications technology in the 1990s. [ABSTRACT FROM AUTHOR]

Introduction The twentieth century both opened and closed with a bang: the belle époque before 1914 and the “roaring nineties” (Stiglitz, 2003) just past. It was only after the First World War that people looked back at the 1895–1914 period with nostalgia as a “beautiful era” of spreading prosperity, peaceful technical progress, low inflation, and modest financial instability. The 1990s, on the contrary, were seen as the “best of times” (Johnson, 2001) by many of those who lived through the decade – at least, those in the United States. Will future historians confirm this view? If the twentieth century is any guide, much will depend on how the twenty-first century unfolds. If peace again prevails, if productivity growth continues apace at the economic center and spreads to the periphery, if means are found to govern the international economy in ways that make the costs of globalization socially acceptable, then the 1990s may well be remembered as a moment in human history when the foundations were laid for a long period of sustainable growth. If, on the other hand, social, political, and economic instability prevails, as it did after the First World War, then people may indeed look back at the 1990s as “the best of times,” creating the myth of another belle époque. Posterity will magnify the virtues of the last decade in the twentieth century and ignore its shortcomings. [ABSTRACT FROM AUTHOR]

Introduction Euro-pessimism is back. The last bout of optimism about the economic prospects of the European Union came at the beginning of 2001, following the launch of the Lisbon reform agenda (which was supposed to modernize the EU economy and make it the most dynamic and competitive in the world) and the first indications of a significant slowdown of the US economy. At that time many European ministers expressed their belief that Europe, and the European Union in particular, was poised to become the engine of growth for the world economy. Economic performance has not been kind to such forecasts. Between 2001 and 2003 average economic growth in the Union was slightly above 1 percent, versus 2 percent in the United States. Prospects for 2005/2006 are not much better, with US growth according to the OECD projected at 3.5 percent against 2.3 percent in the European Union. Looking backward does not offer much consolation either: between 1990 and 2000 GDP increased at an average annual rate of 3.2 percent and 2.1 percent in the United States and in the European Union respectively. Focusing on the performance of the Euro area rather than on the Union would only make the gap with the United States larger. Adding to the concerns of the Euro-pessimists is the steady erosion of the EU export share in world markets. Between 1990 and 2001 Germany's export share fell from 12.1 percent to 8.1 percent. [ABSTRACT FROM AUTHOR]

Introduction This chapter considers the 1990s in the context of long-run economic growth performance. Growth in the context of this chapter should be understood to comprise the growth of real living standards as well as real GDP per capita. There were a number of new experiences during the decade that were sufficiently surprising to warrant posing the question: “Do we now need to rethink the conventional wisdom about economic growth?” The essential background to growth in the 1990s was the unprecedented extension and intensification of globalization in terms of the international integration of capital and product markets, sustained both by reductions in transport and communication costs and also by policy choices. Table 2.1 reports an increase in world merchandise exports relative to world GDP from 12.7 percent in 1990 to 18.8 percent in 2000, more than double the ratio reached before the disintegration of the world economy in the interwar years. Even more impressive has been the surge in international capital mobility, reflected in Table 2.1 through the ratio of assets owned by foreign residents to world GDP, which rose from 25.2 percent in 1980 to 48.6 percent in 1990, and further to 92.0 percent in 2000 – about five times the peak reached in the early twentieth century. Obviously, this was facilitated by the more general adoption of policies of trade openness and financial liberalization. But technological progress also played an important role. [ABSTRACT FROM AUTHOR]

INTRODUCTION After the Soviet Union collapsed in December 1991 and market reforms were initiated, the economic performance of the successor states was more than disappointing. By the end of the 1990s, output (GDP) fell by about 50 percent compared to the highest prerecession level of 1989 (see Fig. 1). Investment dropped even more, income inequalities rose greatly so that real incomes declined dramatically for the majority of the population, and death rates increased by about 50 percent with a concurrent decline in life expectancy. In Russia output fell by 45 percent in 1989–98; suicide rates, crime rates, and murder rates skyrocketed; and death rates increased from 1 percent in the 1980s to 1.5 percent in 1994 and remained at this higher level thereafter, which was equivalent to over 700,000 additional deaths annually (see Fig. 2). Over a period of several years, such population losses are comparable to the impact of World War II on Soviet society. By way of comparison, during the Second World War national income in the USSR fell by only 20 percent in 1940–2, recovered to its 1940 level in 1944, fell again by 20 percent in 1944–6 during the conversion of the defense industry, but exceeded its 1940 level by nearly 20 percent by 1948. In some of the former Soviet states that were affected by military conflicts (Armenia, Azerbaijan, Georgia, Moldova, Russia, and Tajikistan), GDP in 2000 was only 30 to 50 percent of its pretransition levels; in Ukraine, even without the military conflict GDP fell by nearly two-thirds (see Fig. 1). [ABSTRACT FROM AUTHOR]

The Western Development Program has been featured prominently in government media since it was first proclaimed by President Jiang Zemin in June 1999. The program is the centerpiece of the Chinese government's effort to strengthen national unity and integration. By initiating the Western Development Program (WDP), the government of China has acknowledged the strength of the centrifugal forces tugging China apart, and it has undertaken a highly visible and symbolically important program designed to offset those forces. In a sense, the WDP is the Chinese government's response to the trends that are the main themes of this volume, and an attempt to demonstrate the government's commitment to national unity. The first half of this chapter describes the emergence of the WDP. The concerns that led to a priority western development plan grew during the late 1980s and 1990s along with changes in the patterns of China's regional economic development, and with increasing recognition of the problem of poverty. The fiscal position of the government improved dramatically at the end of the 1990s, after the fiscal reform of 1994, and this made it possible for the government to devote substantial new resources to regional development. Thus there is a simple story at the heart of the WDP: Economic reform brought rapid growth to China's coastal regions, exacerbating regional inequality; and after the government gained adequate control of its finances, it began to make an effort to correct these regional imbalances. [ABSTRACT FROM AUTHOR]

As marketization of the economy and a concomitant decentralization of economic decision making became increasingly entrenched after 1980, new factors appeared, both political and economic, that determined a place's possibilities for growth, instead of – as in the past – its position in the state plan alone had. Thus, the provinces became much more diverse economically than they had ever been in the previous three decades, with growth in those along the coast markedly more successful than that in the provinces in the interior. In accord with this drive to marketize, at the 1997 15th Congress of the Chinese Communist Party, the leadership at last announced a mammoth project of worker cutbacks in a sudden push for enhanced enterprise efficiency. A few quotations from the following year embrace this spirit. On the domestic economy, a book on Liaoning makes this allegation: To meet market economic demand, industrial enterprises must continue to reduce staff and increase efficiency to raise their productivity. Taking a long view, this will promote economic development, and eventually provide more employment opportunities, but in the short term we can't absorb new labor but instead the demand for labor will decline. On the international economy, a major labor journal gives this caution: We must optimize the investment environment … raise the ability to absorb foreign:apital. [For this] lowering labor costs is decisive. Indeed, the switch from plans to markets did not just mean relinquishing planning domestically. [ABSTRACT FROM AUTHOR]

Introduction British defence policy in the inter-war years may be divided into two phases: 1919 to 1932, when economic problems and the absence of pressing dangers to national security led to reductions in the armed forces; and 1932 to 1939, when the darkening international situation gave defence preparedness increasing political priority. However, many of the strategic problems encountered during the later 1930s were rooted in the earlier phase, and this chapter analyses the period 1919–39 as a whole. There is a danger in this approach, since policies in the 1920s may be judged unfairly in the light of later events, but that is true even of the 1930s, when British defence policy was designed to deter aggression over an indefinite period even if the Chiefs of Staff were planning from 1934 on the basis of being ready for war by 1939. In August 1919 the Cabinet decided that the defence departments should revise their estimates of expenditure for the coming year on the assumption that ‘the British Empire will not be engaged in any great war during the next ten years, and that no Expeditionary Force is required for this purpose’. The purpose of this ‘Ten Year Rule’, as it came to be called, was to assist the chancellor of the exchequer in securing the cuts in expenditure required to balance his budget and, in one form or another, the rule remained the guiding principle of defence policy until 1932. [ABSTRACT FROM AUTHOR]

Introduction The years before the First World War saw radical changes in Britain's international relations, and consequently in defence policy. In 1902 the Cabinet's Committee of Imperial Defence (CID) identified the following priorities: first, defence of the United Kingdom from invasion, with France being seen as the main threat; second, defence of Britain's empire in India against a possible invasion from Russia; and third, defence of the route to India through the Mediterranean, against France and Russia. These priorities reflected the prevailing imperial rivalries, and it was against the French and Russian navies that the Royal Navy's two-power standard had been designed in 1889 and reaffirmed in 1893. The German Reichstag passed a naval law in 1900 providing for a larger fleet, the purpose of which was to give Germany bargaining power over Britain in the event of the latter's navy being weakened in a war with France and Russia, but it was not until after the destruction of most of the Russian navy in the Russo-Japanese War of 1904–5 that Germany clearly became Britain's principal naval rival. Britain's traditional foreign policy objectives had been a balance of power in Europe, the independence of the Low Countries and the security of her trade routes and overseas interests, but so long as German military power was balanced by the Franco-Russian alliance of 1894, Britain could avoid European commitments. [ABSTRACT FROM AUTHOR]

The starting point for this study of British defence policy between 1904 and 1969 is the tendency for the costs of new weapons systems to rise more rapidly than the national income. Three main insights are offered. First, British defence policy was based upon technological innovation. Second, reductions in the size of the armed forces to accommodate new weapons systems in defence budgets were not evidence of a decline in power. Third, British grand strategy, incorporating economic as well as military responses to external threats, was much more ambitious than is commonly believed. I first approached the relationship between economics and strategy in my book British Rearmament and the Treasury, 1932–1939, which showed that Treasury attempts to influence strategy reflected concern about Britain's ability to sustain a long war, and were related to trade and industry as well as money. Since then there have been a number of case studies of interaction between economics and strategy. For example, David French and Avner Offer have described how British strategic planning before 1914 assumed that naval blockade would cause the German economy to collapse, while Britain's access to raw materials and her industrial power would enable her to supply continental allies with munitions. David Edgerton has challenged assumptions about British military backwardness by putting forward a broad-arching thesis of Britain as a pioneer of technologically focused war, possessed of a powerful military-industrial-scientific complex that emerged in the first decades of the twentieth century and was cut back only in the late 1950s and the 1960s. [ABSTRACT FROM AUTHOR]