One is not enough! An economic history perspective on world trade collapses and deglobalisation
No.1, 2017 One is not enough! An economic history perspective on world trade collapses and deglobalisation Peter A.G. van Bergeijk The author believes “one is not enough” – the economic literature studing only one event is inadequate for useful generalization. Economics can learn a lot from natural experiments, but much more from repeated natural experiments. This paper provides a comparative economic history perspective on two significant periods of deglobalization: the Great Depression in the 1930s and the period following the Financial Crisis of 2008/9. It discusses differences and similarities and provides empirical results regarding the correlates of deglobalization, including the political system (institutions), level of development (GDP per capita) and the share of manufacturing trade in imports. The author’s empirical analysis explores the substantial amount of cross-country variations in deglobalization by means of an unbalanced panel that covers 31 economies in the 1930s and 111 to 143 economies in the 2000s. The investigation relates to the extent of deglobalization during the period of import collapse of individual countries (the peak to trough movement).