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Two Waves of Globalisation: Superficial Similarities, Fundamental Differences

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  • Richard E. Baldwin
  • Philippe Martin

Abstract

This paper looks at the two waves of globalisation (roughly 1820-1914 and 1960-present) focusing on key economic facts (trade investment, migration, and capital flows, Industrialisation/de-industrialisation convergence/divergence) beliefs and policymaking environments. The two waves are superficial similarities but are fundamentally different. Chief similarities include aggregate trade and capital flow ratios, and the importance of reductions in barriers to international transactions. The fundamental difference lies in the impact that these reductions had on trade in goods versus trade in ideas. Initial conditions constitute another important difference. Before the first wave, all the world was poor and agrarian. When the second wave began, it was sharply divided between rich and poor nations.

Suggested Citation

  • Richard E. Baldwin & Philippe Martin, 1999. "Two Waves of Globalisation: Superficial Similarities, Fundamental Differences," NBER Working Papers 6904, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:6904
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    JEL classification:

    • F1 - International Economics - - Trade
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance

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