**1. Introduction**

### **1.1 The processes of globalization once historically defined**

Contrary to the grammar definition of globalization according to the Oxford Dictionary ("the process by which business or other organizations develop international influence or start operating on an international scale"), to treat this topic we will take the first move from the well-known source Wikipedia, which more properly describes globalization as follows: "the process of interaction and integration among people, companies, and governments worldwide."

Once this working start could be accepted, we could rely on the following basic points, anyway to be analytically discussed:

1.political interaction,


These processes are antique ones from the origins of the civilized word or so, dating back (just to synthetically exemplify) to Etruscan and Romans relationships, to Phoenician maritime trade, to inter-African economic exchanges, and—skipping some 1000 years due to common knowledge—to Marco Polo and Euro-Asian commercial traditions along the silk way, as well as to Euro-American ones after Colombo discovering the New Lands.

In every such cases, i) new political interactions immediately started, driving in rare cases to relationships on equality base but, more frequently, to the domination of a nation over other entities, this being the origin of colonial empires from Portugal onward; ii) stable and (rapidly) growing economic relationships on the basis either of mutual agreement or of widespread embezzlement, plunder, and sack, for example, Spain started a huge gold import from South America so as to give life to her cultural *siglo de oro* but, at the same time, to a dramatic inflation that started her decline; iii) cultural exchanges, in some cases consisting in the wrecking and crossing out of local cultures (this was the case of Australian natives after Captain Cook conquest in 1770), in other ones giving life to a confused, heteroclite merger of pre-existing and imported, of local and foreign, the so-called *enculturation*, and originating the reverse process, when, for example, the Greek culture deeply influenced the Roman one ("*Graecia capta ferum victorem cepit*").

In any case, not to say always, these processes brought about i) a dominant political authority, ii) its government, bureaucracies, laws, iii) its language, and iv) its money.

Every political domination, in fact, was of close lands or far ones, in every case accompanied by the following unifying processes, some of which are highly relevant both in those times and today, as still surviving ones:


This way, reflecting back to the political *equilibria* of the last five centuries broadly speaking, we propose to distinguish here, within the geographical processes of equalization of laws, money, and bureaucracy, the three following periods:

a.the (sub)continental equalizations of a)1) the Roman Empire, especially at its climax, a)2) the Sacred Roman Empire of Charlemagne, a)3) the Persian empire of prince Babur from Saudi Arabia to Iran to India, and a)4) the <Great China> of the Quing dynasty, especially under Kangxi, Yong-zen, Quian-long Emperors;

b.the three early colonial empires of Holland, Portugal, and especially Spain;

c.the intercontinental empires deriving from the second colonization conquests, giving life to French Empire and moreover to the British one, as at the end of the nineteenth-century Great Britain dominated 1/3 of world lands.

The above distinction offers us, as a matter of fact, the chance to quote a relevant, well-known interpretative category, the Gerschenkron model referred to the *sequence of sovereign powers*, showing step by step the decline of Spanish, Portuguese, and Dutch influence facing the larger strengths and world-wide ambitions of both England and France. Once the latter was confused by the troubles of the Revolution and its ups-and-downs follow-ups (as, after the loose of its American colonies, in addition it had to face three overturns of political regimes in just 26 years and one more some 50 years later), the room was left for the aggressive, goal-minded temper of Great Britain, while i) the Imperial Russia was isolated in her social and climate problems, ii) the Empire of Austria-Hungary secluded in Mid-Europe with no costal access but Trieste and too many different ethnic groups to be governed, and iii) to conclude with Germany and Italy still to be unified under, respectively, prince Bismarck and earl Cavour. These international dynamics can be summarized in **Table 1**.

At the same time, the abovementioned distinction, once generally interpreted, allows us to recall to memory one more well-known distinction, that is, the difference between i) land powers and ii) see powers. As a matter of fact as, Babur (and China) apart, in every remaining case the intercontinental domination was the fruit of naval strength and the military fleet to conquer, to preserve, and to secure commercial routes.

Moving first to the industrial revolution, thanks to its technical advances as well as the capitals accumulated by privateer war, England succeeded both in establishing a world domination and in impeding the existence in Europe of any leading country (or even alliance) able to jeopardize its supremacy, from Napoleon onward. Later, this natural behavior was theorized by relevant Anglo-Saxon admirals and scholars,


**Table 1.** *Rise and decline of states.* Alfred T. Mahan, Halford J. Mackinder, Nicholas J. Spykman, among others. The supremacy we remember here declined anyway in favor of the USA, after the World War II (1941), Bretton Woods (1944), the atomic bombs on Hiroshima and Nagasaki (1945), the Marshall Plan (1948). This way, the supremacy of the pound sterling disappeared in favor of the US dollar, and similarly for the rest, beginning by the India independency (1949).

Not so curiously anyway—that's why we recall this theory here as globalization is regarded—in both cases these maritime superpowers realized (or tried, and the USA still try) the following realities: i) a unique country dominating the world, ii) a country isolated by the sea (or Oceans) but ready to intervene by the army in other countries or even continents, iii) under such political principles as *free market*, *monetary (and financial) supremacy*, *maritime strength*.

This rough overview of well-known century-old dynamics teaches us anyway some peculiar hints, judged relevant here with reference to the topic under discussion as in so many cases still surviving today. These suggestions respectively regarding the role of legal systems and its special regulations, the role of the (imposed) monetary regime, are still to create new currency (and financial) areas, the not-so-peaceful rotation of sovereign powers, a political struggle, which can be interpreted as the oligopoly competition, frequently leading to wars in their different forms.

### **1.2 The process of globalization and its technological drivers**

The historical dynamics are so poorly recalled here in memory because of common knowledge, brought about, along centuries and decades, a dramatic increase of international exchanges of economic goods, financial and monetary resources, capital and investments, knowledge, cultures, and ideas. At the same time, they generated the parallel increase of international trade, this happening with the Industrial Revolution of England and the further ones (**Table 2**), from the United States of America to Belgium, and to France (once she overcame the troubles of the revolution) and to the following ones of Germany, Italy, and other countries.

In particular, the Congress of Wien marked the beginning of a long period of peace for Europe—a century—till the World War I, with the French-German war of 1870–71 being there an *entre-act* of nearly no relevance.


#### **Table 2.** *The three "industrial revolutions."*

*Our Globalization Era among Success, Obstacles and Doubts DOI: http://dx.doi.org/10.5772/intechopen.105545*


#### **Table 3.**

*The main inventions 1827–1939.*

A century of peace meant, in addition, a century of technological progress (**Table 3**), this fuelling production, exchanges, communications, in such a way and in hurry we find it difficult to understand, and only comparable to the present Web revolution.

The technical progress obviously influenced also public and private bureaucracies, work organization, labor relationships, these elements being constituting a relevant (and under-esteemed) factor in accompanying or even guiding the globalization process. On one side, new investments and the search for working (labor) resources oriented in fact internal and international immigrations; moreover, they contributed—in colonial Empires—to international investments, which, on their turn, further contributed to the globalization itself. On the other side, the new organizational techniques (e.g., Frederick W. Taylor) allowed to increase productivity, productions, salaries, profits, this fuelling once more offer, demand, and investments. Taylor's suggestions had been practically anticipated and largely applied in Krupp factories before 1910, and were later utilized for large-scale consumer goods by Henry Ford from 1923 onward.

Technological advances of those days fuelled since then inter-continental integration, giving life to larger international communications, higher import-export, more trade agreements, and widespread international investments (Gualino, a tycoon ruler of Italian finance end-nineteenth-early twentieth centuries largely invested in St. Petersburg, unfortunately before 1917, Pirelli & Co. vertically integrated acquiring rubber plantations in Malaysia). All the same, on a larger scale, is happening in today world, especially after 1948 (Marshall Plan), 1976 (China's Four Modernizations), 1991 (crumbling away of Soviet Russia), WTO, and WEB revolution.

With regard to the Four Modernizations, their purpose was to make China one great economic power, and the results are evident if we consider the evolution of the national shares of world production from 2000 to 2018 (**Table 4**).

#### **1.3 Trade liberalization as a driver for globalization after the World War II**

A further driver that oriented the globalization process after the World War II was trade openness [1], to which a set of factors contributed, such as [2]:


The above factors, together with others specifically referable to the individual geographical areas, led to a significant reduction in post-war trade barriers among the major industrialized countries, as well as a notable increase in capital movements [4].

In this regard, in addition to the GATT (1947), it is important to recall the creation of the European Common Market (1958 Treaty of Rome and 1968 customs union); the Canada US Free Trade Agreement (CUSFTA) of 1987; the North American Free Trade Agreement (NAFTA) of 1992; the ASEAN Free Trade Area (AFTA) Agreement of 1992; the establishment of the World Trade Organization (WTO) of 1995; and the General Agreement on Trade in Services (GATS) of 1995.

We mentioned above only a few among a number of trade agreements signed between the '40s and '90s of the last century. Also considering the 2000s, the increase in the number of regional trade agreements (RTAs) has been continuous and rapid (**Figure 1**).

As pointed out by Urata [5], regional trade agreements (RTAs) remove trade barriers and significantly contribute to the quantitative and geographical expansion of international trade.

This expansion is clearly visible if we consider the evolution of the worldwide trade in the decade immediately following the signing of GATT (**Table 5**).


#### **Table 4.**

*National percentage share of world production 2000–2018.*

#### **Figure 1.**

*RTAs currently in force (by year of entry into force), 1948–2022. Source: WTO OMC, regional trade agreements database.*


#### **Table 5.**

*Worldwide trade 1948–1990 (billion dollars).*

In terms of percentage change, the growth of the world merchandise trade by selected region, which took place between 1990 and 1999, is presented in **Table 6**.

The positive effects of the trade agreements continued throughout the following decade, in which global trade growth remained sustained (**Table 7**). If we disregard the distributional consequences [6] and limit the analysis to the values exchanged, world exports continued to increase (**Table 7**).

The above data show the bivalence of globalization: On one hand, they reveal its positive effects on international trade; on the other hand, they show that the negative influences of crises of local origin (US), such as the 2008 financial 0ne, spread with equal speed and magnitude, especially at the expense of weaker economies.

As a matter of fact, within economic integration—be it commercial or financial the less-developed countries are generally dependent on the industrialized ones, with the consequent increase of their net indebtedness toward stronger economies.


*Source: World Trade Organization, International trade statistics 2000.*

#### **Table 6.**

*Percentage change in the volume of world merchandise trade 1990–1999.*


*Source: https://www.statista.com/statistics/264682/worldwide-export-volume-in-the-trade-since-1950/ (accessed 6 May 2022).*

#### **Table 7.**

*Global export value of trade in goods 2000–2008 (billion dollars).*

The subprime crisis caused profound effects and imbalances, to cast doubts on the real benefits of world integration in the absence of domestic growths [7].

In this latter respect, it is nevertheless relevant to consider that globalization, while not sufficient to reduce poverty on a large scale, anyway favors internal growth. According to Dreher [8], China was the country with the highest increase in the level of globalization from 1975 to 2000. Thanks to its increased integration with the rest of the world, the growth rate of its economy in 2000 was 2.33 percentage points higher than in 1975.
