Williamson and O’Rourke’s seminal work on the start of globalisation argues, with extensive economic analysis, that globalisation could not have occurred any earlier than 1820. They are wrong. In fact price convergence and a spike in trading volume, which they cite as the evidence for their assertion, were only the economic effects of the political and cultural changes of the 1780s and 1790s. This report will contend that the roots of globalisation can be traced back to the American and French Revolutions and the twin forces of liberalism and nationalism that they unleashed. Moreover, the revolutions coincided with industrial revolution and caused a change in worldwide economic policy, from mercantilism and autarky to free trade. Indeed, the political and cultural developments of the late 18th century were essential for the global economic explosion of the mid-19th century. Therefore, the 1780s and 1790s were the start of Globalisation.
As the biggest historical events of the late 18th century, and arguably the modern world, the American and French revolutions can broadly be credited with unleashing the twin forces of nationalism and liberalism on the global stage. Nationalism brought more intense global competition and saw the emergence of the nation state. Rather than making the world more anti-global, national competition manifested itself in the West as regional competition within Europe, therefore spawning an increased need to a global presence and interaction. In Europe, nationalism coincided with the Enlightenment and the beginning of modernity. The ‘civilising mission’ only sought to further western desire for empire building. However, this is not to suggest that globalisation was an exclusively Eurocentric phenomenon. Liberalist policies of Asian states marked the beginning of a global exchange system based on free trade rather than autarky. Indeed, by 1855 Japan, China and Korea had all opened up their previously protectionist economic policies. It is this free trade of the mid-19th century that provides much of the impetus behind Williamson’s and O’Rourke’s argument: declining transport costs and increase in world trade volume. Therefore the roots of the shift in the global economic landscape can be traced back to the political and cultural developments of the end of the 18th century.
The spread of liberalism and nationalism at the end of the 18th century coincided with the start of the industrial revolution, which moved the world economy towards globalisation. Technological advancements such as the invention of the steam engine in 1765 signalled the start of large scale capital production. As a result, there was a huge drop in the real price of many commodities. For example, statistic compiled by Allen show that from 1781 the price of cotton dropped by over 50% in 20 years, from 8 grams of silver per metre in 1781 to 3 grams of silver per metre in 1801. This meant supply could keep up with ever increasing world demand and trade volumes. It was the liberal outlook of the late 18th century that allowed these technological developments to generally be spread and implemented in manufacturing on a global scale. For many authors, the end of the 18th century was the nexus of imperialism. For Bayly it was “the first age of global imperialism” and Hobsbawm’s “Age of Revolutions” was, through imperialism, the beginning of the modern world history. Indeed, these assertions are broadly true; European trade with the East boomed and increased trade marked the beginning of price convergence, even if would take another century before full price convergence could be achieved. For example, by the late 18th century, the price of pepper between England and India was falling its peak of 6 times the price of India in England at the beginning of the century. But imperialism brought about much more than economic interaction. More importantly, early European imperialism brought increased cultural interaction which meant the Enlightenment thoughts of French philosophes on republicanism could be translated into the American Declaration of Independence. Thus, by the 1780s and 1790s the outlook of leading nation states was decidedly global. Globalisation had begun.
This symbiotic development of the political and economic regimen of global trade in the 1780s and 1790s can be credited with the start of globalisation. This date cannot be pushed any earlier due to the prevalence of the mercantilist foreign policy of the global powers. Their inherently anti-global policies resulted in competition for a finite supply of luxury goods. Moreover, there was a global disparity between the East and the West as spices and sugar from the Asian markets were traded for silver from the New World. As there was not competing global commodity production, prices could not converge and globalisation could not truly begin. Equally, this date cannot be pushed any later because the shift in economic data in the middle of the 19th century was rooted in the developments of 1780s and 1790s. The shift towards a liberal and social economic policy in this period brought about the price convergence and increase in trading volume that has so preoccupied Williamson and O’Rourke. Therefore, in terms of the start, the genesis, the point of creation of modern globalism, one can look at no other period than the 1780s and 1790s.
Bibliography
- Allen, Robert C. Global Economic History: A Very Short Introduction. Oxford: Oxford University Press, 2011.
- Bayly, C.A. ‘“Archaic” and A-Modern Globalization in the Eurasian and African Arena, c. 1750-1850', in A.G. Hopkins, ed., Globalization in World History (2002).
- Das, Dilip K. “Globalisation: Past and Present,” Economic Affairs, 30/1 (2010), pp. 66-70.
- Ferguson, Niall “Sinking Globalization,” Foreign Affairs, 84/2 (2005), pp. 64-77.
- Lang, Michael, “Globalization and Its History,” Journal of Modern History, 78/4 (2006) pp. 914-931.
- O’Rourke, Kevin H. and Jeffrey G. Williamson. ‘When did Globalisation begin?’. European Review of Economic History. 6. Cambridge University Press. (2002). pp. 23-50.