i. age empires (globalization 1.0) ii. pax britannica (globalization …casey1/pge...

I. Age of Empires (Globalization 1.0)II  Pax Britannica (Globalization 2 0)II. Pax Britannica (Globalization 2.0)III. Interwar Years and CollapseIV. Pax Americana (Globalization 3.0)V. Explanations and Current Crisisp

World Map Scaled by per capita GDPWorld Map Scaled by per capita GDP

The Pre Colonial WorldThe Pre‐Colonial WorldEuropean Dominance –Why?Competitive Nation‐StatesCompetitive Nation‐StatesDevelopment of Commercial & Financial MarketsEnlightenment and Technological DevelopmentEnlightenment and Technological Development

Mercantilism and Colonial ExpansionpResources (Gold and Silver)Slave‐Based Agriculture

“That belongs tous now…”

Sources of British DominanceSources of British DominanceHegemonic Stability TheoryElements of the Pax BritannicaElements of the Pax BritannicaSecurity – ‘Britannia Rules the Waves’ You need an umbrellathe Waves

Markets –Unilateral Free TradeCommon Currency – Pound/Gold Standard

ou eed a u b e awhen the sun never sets.

y /Loans – Early Industrialization and Surplus

Sources of British Decline

Reparations and International PaymentsDemise of the Gold Standard

ll llWall Street CollapseDomestic Squeezing

h hb

Hawley and Smoot look to a grim future

Beggar‐Thy‐Neighbor’  Trade Policies Smoot‐Hawley Tariff (1930)

Collapse of the Global Economy

The BrettonWoods S stemThe BrettonWoods SystemFixed Exchange Rates (Dollar Standard)

l l l dMultilateral Free Trade (GATT)International Lending (IMF/World Bank)

I i l S i  (NATO) “S il h f International Security (NATO)The ‘Golden Age of Growth’B kd   f B W d

“Smile – the future will be brighter.”

Breakdown of BrettonWoodsEconomic Revival and R d Gl b li iRenewed Globalization

US delegation to the BrettonWoods Conference

So rces of the C rrent CrisisSources of the Current CrisisUS Housing bubble (subprime mortgages)

f dSecuritization of mortgages via derivativesContagion of Financial Markets following Housing B bbl  C llBubble Collapse

Bank Bailouts and Fiscal StimulusA G  R i    D iA Great Recession, not Depression

Q: Was Globalization the Cause?? 

Nightmare or Reality?