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Coping with Shocks and Shifts: The Multilateral Trading System in Historical Perspective

In: Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century

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  • Douglas A. Irwin
  • Kevin H. O'Rourke

Abstract

This paper provides a historical look at how the multilateral trading system has coped with the challenge of shocks and shifts. By shocks we mean sudden jolts to the world economy in the form of financial crises and deep recessions, or wars and political conflicts. By shifts we mean slow-moving, long-term changes in comparative advantage or shifts in the geopolitical equilibrium that force economies to undergo disruptive and potentially painful adjustments. We conclude that most shocks (financial crises and regional wars) have had relatively little effect on the trade policy, but that shifts pose a greater challenge to the system of open, multilateral trade.
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  • Douglas A. Irwin & Kevin H. O'Rourke, 2013. "Coping with Shocks and Shifts: The Multilateral Trading System in Historical Perspective," NBER Chapters, in: Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century, pages 11-37, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:12575
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    Cited by:

    1. Gary D. Libecap, 2014. "Addressing Global Environmental Externalities: Transaction Costs Considerations," Journal of Economic Literature, American Economic Association, vol. 52(2), pages 424-479, June.
    2. Colantone, Italo & Ottaviano, Gianmarco & Stanig, Piero, 2021. "The backlash of globalization," LSE Research Online Documents on Economics 113860, London School of Economics and Political Science, LSE Library.
    3. Eric B. Schneider, 2014. "Prices and production: agricultural supply response in fourteenth-century England," Economic History Review, Economic History Society, vol. 67(1), pages 66-91, February.
    4. Aled Davies, 2012. "The Evolution of British Monetarism: 1968-1979," Oxford Economic and Social History Working Papers _104, University of Oxford, Department of Economics.
    5. Schneider, Eric B., 2013. "Real wages and the family: Adjusting real wages to changing demography in pre-modern England," Explorations in Economic History, Elsevier, vol. 50(1), pages 99-115.
    6. Glaser, Darrell J. & Rahman, Ahmed S., 2016. "Ex Tridenti Mercatus? Sea-power and maritime trade in the age of globalization," Journal of International Economics, Elsevier, vol. 100(C), pages 95-111.
    7. Schneider, Eric B., 2013. "Real wages and the family: Adjusting real wages to changing demography in pre-modern England," Explorations in Economic History, Elsevier, vol. 50(1), pages 99-115.
    8. Gary D. Libecap, 2013. "Addressing Global Environmental Externalities: Transaction Costs Considerations," NBER Working Papers 19501, National Bureau of Economic Research, Inc.
    9. Italo Colantone & Gianmarco I.P. Ottaviano & Piero Stanig, 2021. "The Backlash of Globalization," CESifo Working Paper Series 9289, CESifo.
    10. Aled Davies, 2012. "The Evolution of British Monetarism: 1968-1979," Oxford University Economic and Social History Series _104, Economics Group, Nuffield College, University of Oxford.
    11. Eric B. Schneider, 2014. "Prices and production: agricultural supply response in fourteenth-century England," Economic History Review, Economic History Society, vol. 67(1), pages 66-91, February.
    12. Samuel Standaert & Stijn Ronsse & Benjamin Vandermarliere, 2014. "Historical trade integration: Globalization and the distance puzzle in the long 20th century," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 14/897, Ghent University, Faculty of Economics and Business Administration.

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    More about this item

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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