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A tale of two globalizations: gains from trade and openness 1800-2010

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  • Federico, Giovanni
  • Tena Junguito, Antonio

Abstract

This paper compares the wave of globalization before the outbreak of the Great Recession in 2007 with its alleged historical antecedent before the outbreak of World War One. We describe trends in trade and openness, estimate the gains from trade and investigate the proximate causes of the growth of openness. We argue that the conventional wisdom has to be revised. The first wave of globalization started around 1820 and culminated around 1870. In the next century, trade continued to grow, with the exception of the Great Depression, but openness and gains fluctuated widely. Growth resumed in the early 1970s. By 2007, the world was more open than a century earlier and its inhabitants gained from trade substantially more than their ancestors did. The current wave of globalization, in spite of some similarities with previous trends, has no historical antecedents.

Suggested Citation

  • Federico, Giovanni & Tena Junguito, Antonio, 2016. "A tale of two globalizations: gains from trade and openness 1800-2010," CEPR Discussion Papers 11128, Centre for Economic Policy Research.
    • Handle: RePEc:cpr:ceprdp:11128
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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative

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