Summary of the week
Over 200,000 years of human history, the relationship between production and consumption has changed and four main phases can be distinguished.
Phase 1 saw the world being “humanised”, Phase 2 saw the world economy being “localised”, and Phase 3 saw the take-off of traditional globalisation where international trade boomed, and nations specialised in the production of particular types of goods. Phase 4, which is the phase we are living in today, started around 1990 and is marked by the spread of global supply chains and a massive shift of manufacturing know-how from rich nations to a handful of emerging markets. This has resulted in a massive industrialisation of the emerging markets and a de-industrialisation of rich nations.
Now that you have a broad understanding of the long-run trends of globalisation, we turn next week to the economic impact of globalisation. This will involve learning some basic economics that should help you understand all sort of economic phenomenon, not just globalisation.
Let’s continue the journey together!
© Richard E. Baldwin