Each of us has some friends we share with. Each of your friends has different brands of mobile phones. Some of them are Made in Japan, some of them are Made in the Us, and some of them in Made in South Korea.
Each of you lives in the same country and buys a phone from your local electronics shops. So how did the products made in different countries come to you?
Suppose you go to big multiplexes and buy foreign brand clothes that come from almost all overseas. How is it possible?
All this is possible as a result of globalization. The answer to these questions is hidden in one word, that is, globalization.
So let’s find out the answer to the question- What is Globalization? What about the history of globalization?
Table of Contents
What is Globalization?
The Information and Communication Technology (ICT) revolution, the free flow of information-based and knowledge-based economies, and the growing integration with the global economy of the national economy, and the market economy is the key to globalization.
So globalization is the process by which the free market economy is ensured all over the world. In this process, foreign companies are doing trade throughout the world. That’s why you can get all the foreign products at a minimal price from your doorstep.
It is also a mechanism of mutual interaction and interconnection that initiates coordination and interaction between governments, institutions, and peoples of different nations. The driving force of this approach is international trade and investment, and its main supporting force is information technology.
Environment, culture, political system, economic development and progress, and human and social progress; It has a clear effect on everything. Although research on globalization has literally begun, this matter must be quite ancient.
Although globalization is broadly used since 1970 globalization as a concept we can find from ancient times, people have been shown to participate in international trade. Although there was no general policy then. The history of globalization begins from thousands of years ago, in the Middle Ages, the Silk Road was used to trade China with Europe through Central Asia.
Must-Read– 5 Important Types of Globalization
Features of Globalization
From the above discussion, we also find some features of globalization. These are-
- Integration of Economies
- Liberalization
- Privatization
- Free Trade
- Interconnectedness
1. Integration of Economies
The integration of economies throughout the world is necessary for interaction and integration among people, companies, and governments worldwide.
It is a process in which agreements are done among the countries within a particular geographic region for reducing tariff barriers to ensure a free flow of goods and services.
2. Liberalization
To ensure integration of economies among the countries it is necessary to implement the process of liberalization in their own countries.
Like the integration of economies, liberalization also is a process by which a country reforms its economic policies to open its market to all. It ensures the freedom of the entrepreneurs for the establishment of any kind of legal trade or industries in their own countries or abroad.
3. Privatization
After liberalization, it’s time for privatization. Without liberalization, there is no existence of privatization. Privatization refers to the transfer of ownership of any property, corporation or business, or service from the government to the privately owned sectors.
Globalization would not be possible without LPG. Here L refers to Liberalization, P to Privatization, and lastly G for Globalization. It can be said that liberalization and Privatization are the preconditions of globalization.
4. Free Trade
It refers to free flow trade among the countries without tariff barriers. Free trade can be possible when some countries within the same geographic region sign an agreement for free trade among their countries.
5. Interconnectedness
It provides us a framework to explore the world through interaction with different people, animals, and nature by using several technological tools without any kind of barriers.
Must-Read- Advantages and Disadvantages of Globalization
History of Globalization
Globalization is not a new phenomenon. Today’s globalization has developed through different phases which started in ancient times.
Human beings always moved from one place to another place with the purpose of trade. They exchanged goods, skills, and ideas with other people from history.
Silk Road
I have already mentioned that China used the Silk Road for its trade with Europe through Central Asia. Around the 1st Century BC, Silk Road was first introduced to the Roman Empire.
Throughout history, Eurasia is one of the important paths for communication and trade which links with China. This route or path is called today as Silk Road. Through this road, people share their knowledge, ideas, culture, and beliefs.
Traders along with this road are not only attached to trade but also to intellectual and cultural exchange. Silk was a more expensive and luxurious product that was traded between East and West through this road. Besides silk, there were many products that were traded such as textiles, spices, grain, vegetables, fruits, etc.
Spice Trade
Trade of spices happened from the 7th to 15th centuries by the Islamic merchants in the Middle East. Islamic merchants traded spices from the Middle East to East Asia. The main purpose of that trade was to spread the Islamic religion. As a result of this initiative, you can see a country like Indonesia where the population is a Muslim majority.
The dominating product of Islamic trade was spice. Spice was traded mainly by sea and they were very much focused on international trade in the medieval age.
Age of Exploration
The 15th to the 18th Century was the era of exploration. During this time the exploration of the Europeans connected the East and the West. Columbus’s discovery of America is believed to have begun the journey of modern globalization.
At this time, three things were mainly focused on. These are called 3C
1. Christianity
Christianity represents Western civilization. Based on this notion, Western society sought to spread their religion throughout the world and had many successes.
2. Civilization
Christianity was one of the means of reaching Western civilization all over the world. As we look at the countries of Africa and Asia, we can see that there are many areas where Christianity is particularly prevalent. Although their Ethnic Identity is different.
If you want to know about Ethnicity then this article is a must-read.
Western civilization is perfect and the rest of religion or culture is barbaric. In order to establish this idea, they imposed their culture on these backward countries.
3. Commerce
Now the question is why did they impose their religion or culture on others?
The answer is trade. If you consider Western civilization to be superior, their practical products will attract you. Almost every civilized society is now accustomed to wearing Western clothing and other. Their real purpose was to ensure that Western trade was forever.
A must-Read– Globalization is a Myth or Reality
What are the Four Phases in the History of Globalization?
To understand globalization better, you need to be aware of every phase of it. Then you will understand exactly how globalization has become today’s globalization.
There are mainly four phases of globalization. These are:
First Phase in the History of Globalization
The first phase of globalization began primarily from the 19th century onwards and continued until the beginning of the First World War, which means 1914.
As a result of the industrial revolution, Great Britain influenced the world through their trade. Inventions such as steam engines, industrial weaving machines, and more accelerated trade worldwide. Global trade began in the true sense of this period.
Prior to this phase, the growth rate of world trade was on average at 3% per year. However, since the Industrial Revolution, global trade increased by 6% and subsequently increased by 14%.
During this time, trade in these countries, besides England, France, Portugal, USA, had increased greatly. But England was all around. That is to say, England took a huge advantage in this phase of globalization.
Then came the First World War (1914) and all the countries close their borders again. Global trade fell down again.
Great Depression
Since the First World War, there has been a gradual shift in each country, and world trade has become limited. The result was a recession which was also called as Great Depression.
The recession began in 1929 and ended at the end of the decade of 1930. It is a long-lasting and widespread recession of the twentieth century.
In the 20th century, the Great Depression was used as an example of the collapse of the global economy.
The recession began in the United States after the stock market collapsed on September 4, 1929.
Later on October 29, 1929, the news spread to the global stock market, known as Black Tuesday.
Global GDP declined by about 15% between 1929 and 1932. In some economies recovered in the middle of the 1930s, the effects of the Great Depression on the economy of many countries continued until the beginning of World War II. Then after World War II, world trade almost stopped. However, this is not the end of globalization.
Second and Third Phases in the History of Globalization
After World War II, another new chapter in globalization was launched under the leadership of the USA and World trade has increased again. This time, Iron Curtain divided the whole world into two parts – the USA led on one end and USSR led on the other. But in 1989, the iron curtain was broken and globalization gained a rapid boost.
The EU’s Free Trade and the USA’s rapid increase in trade at the beginning of 1950 helped strengthen the global economy. On the other hand, USSR increase its global trade similarly to the USA but using centralized planning rather than free trade. This time, the world economy returns to its old rhythm. Export once again increase to 14% of global GDP which was achieved in 1914.
Ever since the collapse of the Soviet Union, free trade has been rampant throughout the world. The World Trade Organization is created to promote free trade around the world.
Fourth Phase In the History of Globalization
The world we are living in now is actually the fourth phase of globalization. The two powers that govern the current world now are the USA and the other is China.
Now the Internet is the main driving force of globalization. Now we talk more about the digital economy such as E-commerce, digital services, 3D printing, and so on.
However, negative globalization is also expanding, such as the adverse effects of climate change on Earth, cross-border cyber attacks, terrorism, etc.
I think globalization is a great deal for people/contries in internal and external relation .
It has a weak side for weaks goverment from strongest ones!