The Economics of Globalization: Theoretical, Empirical and Policy Analyses of the Past, Present and Foreseeable Future of Economic Globalization

Dear Colleagues,

Over the past 15 years, we have been witnessing the gradual transformation of economic globalization into 'slowbalization' (a process that may soon turn into open economic de-globalization, amid attempts in favour of re-globalization). This is confirmed by many indicators, including the international trade of goods (but not services) and the international mobility of factors of production, i.e., labour and capital (both financial flows and foreign direct investment).

The reasons for this new trend are not only socio-economic but also geo-political.

The former are mainly due to the cumulation of the many problems that emerged during the previous phase of economic globalization, the one which marked the abandonment at the world level of Keynesian, government-oriented policies and saw the adoption of market-centred policies of deregulation and liberalization. That new stage started with the economic and political revolution at the beginning of the 1980s, that followed the years of instability resulting from the fall of the Bretton Woods System, the inflationary oil shocks, and the resulting stagflation of the 1970s. It is usually considered to have come to an end with the global financial crisis of 2008/2009. The faults of the reliance on the smooth, short run functioning of the markets (especially, but not exclusively, the labour markets) then emerged once more after the example already provided by the Great Crash of 1929, followed by the economic depression of the 1930s. The slow market adjustment was accompanied, still after the 1980s, by a lack of attention towards most of the losers produced by the globalization of the world economy.

One of the problems, among others, was also the acceptance—in the name of efficiency and of a misunderstood idea of free competition—of the excessive concentration of economic power in the hands of just a few big players. Paradoxically, pursuing  indiscriminate free competition in a context in which production processes are characterized by increasing, rather than constant, returns to scale, has produced its nemesis, namely the creation of oligopolies and quasi-monopolies.

In this situation, the promised shared benefits deriving from the globalization of the economy (also exemplified by the celebrated trickle down hypothesis, according to which those benefits would affect everybody positively) could hardly materialise.

As a result, especially after the ‘wake up call’ represented by the 2008/09 global financial crisis, in some Western democracies, leaders promising to 'take back control' of their countries have been prevailing in their respective national elections. In some cases, disillusionment with such promises quickly emerged, but that tendency is far from subdued, as some recent elections across the world and the potential comeback of Donald Trump as president of the US in the elections of November 2024 clearly indicate.

This is also due to the fact that geo-political reasons have been adding to previous problems, particularly the challenge posed by China to the global economic leadership of the US, and the mistrust of global value chains caused not only by the central position of China itself in those chains, but also by the COVID-19 pandemic and the war currently being fought between Russia and Ukraine.

This is why countries that were once called  ‘partners’ are increasingly being defined as ‘strategic rivals’ (in the case of the European Union) or even ‘adversaries’ (in the case of the US) against whose ‘threats’ the necessary protectionist measures must be adopted. Some irresponsible commentators are even already referring to China as an ‘enemy’, thereby encouraging the perception on the public opinion of a passage from the current situation of Cold Peace to an open comeback of the Cold War experienced after World War II. Geo-political reasons are leading the European Union, for instance, to ‘re-shore’ or ‘near-shore’ certain activities and pursue an assertive industrial policy in certain critical sectors (an industrial policy that was long overdue, anyway), with the aim of ‘de-risking’ the European economy. In the US, despite the abandonment of Trump’s open ‘America first’ policy aiming at explicit ‘decoupling’ from the Chinese economy, US companies are still urged to ‘friend-shore’ the production activities they had moved abroad in the past.

What lessons can we learn from the past? What is the current situation of the different aspects of economic globalization and what are its main drivers? What can we expect for the economic future of different regions and of the whole world economy? What would be the future perspectives and effects on the global economy of international economic endeavours such as the launch of the Chinese Belt and Road Initiative or the Regional Comprehensive Economic Partnership? What can we expect for the World Trade Organization and for the other international economic organizations such as the International Monetary Fund and the World Bank? What does economic theory say about the effects that a possible further restriction of the global economy would produce on the world markets of goods, services, labour, or capital? What could be done to make the outlook on the future of economic globalization less gloomy than it appears today?

Answering these and many other related questions is the aim of this call for papers, launched for a forthcoming Special Issue of the scientific journal Economies and devoted to the  “The Economics of Globalization: Theoretical, Empirical and Policy Analyses of the Past, Present or Foreseeable Future of Economic Globalization”, edited by Pompeo DELLA POSTA.

Prof. Pompeo Della Posta
Guest Editor

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• world economy
• economic globalization
• economic slow-balisation
• economic de-globalisation
• economic re-globalisation
• regionalization
• re-shoring
• friend-shoring
• near-shoring
• international goods markets
• international services markets
• international labour markets
• international capital markets
• international financial markets
• foreign direct investments
• WTO
• IMF
• WB
• international economic institutions
• international economic and financial architecture