The decline of globalisation?

The war in Ukraine, Brexit National ‘green’ subsidies suggest that globalisation is in reverse, but this isn’t necessarily a good thing!

A number of recent events in the 2020s suggest that globalisation is in reverse.

In America Jo Biden has made several speeches stating that more manufacturing will take place in America, rather than China, and his presidential predecessor, Donald Trump was vocally anti-globalist, while in Britain the recent immigration Bill suggests a breakdown of commitment to international human rights conventions.

Russia’s war on Ukraine and the hardening of divisions between Russia, its allies and China which is taking a neutral stance, and the U.S. and European nations supporting Ukraine with military aid suggest that the world is fracturing politically and economically, and at the same time global supply chains are still under strain from the aftermath of the Coronavirus Pandemic.

Individual countries are increasingly putting in place policies which protect their borders and economies and it seems are less inclined to support policies which promote globalisation.

The benefits of globalisation

Globalisation is about flows of things, people, finance and ideas across national borders: the more flows there are, the more the world can be said to be globalising.

Globalisation became a tidal wave in the 1990s with several events:

  • The collapse of the UUSR and the end of the cold war
  • The integration of Europe
  • The opening of of China
  • The birth of the World Wide Web

Globalisation made goods cheaper through economies of scale and lifted a billion people out of poverty. When you fragment trade

Globalisation also increases jobs in poor countries through export markets, and when China, the world’s largest exporter, shut off its trade in a chosen response to the Covid-19 pandemic its economy shrank.

For more details on the benefits see this post on the Optimist View on Globalisation.

Globalisation in decline…

Countries are increasingly putting themselves first and focusing on national gain rather than mutual benefit through gradually increasing trade barriers.

The World Trade Organization has assessed the consequences of what might happen if the world splits into separate trading blocks: it would cost the world a 5% loss in GDP in the long term, more than the costs of the entire British economy.

Global trade is essential to maintaining the quality of life we’ve come to expect because no country can produce everything itself: without global trade we have no rice or bananas in the U.K.

If Britain makes it more difficult for other countries to trade with it, other countries will do the same, meaning goods will be more expensive and probable knock on effects such as less tourism, and it be less likely that we’d work together to solve global problems.

National security concerns have affected trade in certain goods, obviously military goods but also microchips and batteries more generally, but there are increasingly trade barriers in other economic sectors too.

One form of anti-global policies is subsidies in which government money is used to make manufacturing at home cheaper than imports.

The problem with this is that it is only the richest countries that have deep enough pockets to do this, and it hurts poorer countries, and in some cases even relatively rich countries cannot compete with economic behemoths such as the United States.

British car manufacturing is at its lowest level since the 1950s because it cannot compete with subsidies in the U.S. The United States is offering billions of dollars in subsidies to companies there who produce electrical vehicle supply chains.

The European Union is thinking of retaliating against the U.S. by introducing its own subsidies for electrical vehicle manufacturers, which would actually make things WORSE for U.K. car manufacturers.

Countries are also increasingly using export controls to protect their economies.

The U.S. has put a lot of export controls on various goods that can’t be exported to China and limits on international investment to protect foreign take overs of American companies. The United States has put these measures in place mainly because it claims China has embarked on unfair competition.

President Biden’s Inflation reduction Act which focuses heavily on green tech only gives out subsidies to companies which are based in America.

One argument for subsidies is to protect strategic industries, because relying on one country alone for any one product makes you vulnerable to supply chain shocks

For example 92% of all global semi-conducted chips are made in Taiwan, which is not really an acceptable risk for other countries because these chips are essential to communications technologies.

Similarly, Africa imports 99% of its vaccines, and it would also probably be better off producing at least some of those vaccines within Africa.

National subsidies can help broaden supply chains and make countries more resilient.

The problem is if subsidies are applied to everything it destroys the free market and is very inefficient, so countries need to be very selective about how they apply them.

The current rules on subsidies were established through the World Trade Organisation in 1994 and some current agreements on trade were entered into before China became a global player. Now the world is a very different place and trade rules may need to be changed to ensure a level playing field

Why the shift to deglobalisation?

In Reagan and Clinton’s era, American was very pro global free trade, which was the mood up until the 2008 financial crisis.

Globalisation created huge wealth on a global scale but it also created enormous inequalities within countries, which are largest in the Anglo-American world, and rising inequalities withing countries may have created the politics of nationalism that we saw with Donald Trump and Brexit.

By 2008 it had become clear that the global market system was working very well for a very small global elite, but not so well for ordinary working people who made up the democratic majority, and the failure to redistribute global wealth fairly led to a backlash and the rise of nationalist politics.

The average income of the bottom 50% hasn’t gone up for 30 years.

The problem with deglobalisation

The problem with this trend towards ‘deglobalisation’ is that it increases tensions between countries making it more difficult to slow climate change and stop the next pandemic. It would also slow growth and increase poverty.

We in the West cannot afford to be cut off from Asian markets with a combined population of 3.6 billion and a growing middle class, projected to be at over 3 billion people by 2030, which will make it the world’s largest market.

If the U.S. and E.U. start to put up trade barriers with China, China might just put up barriers to trade with the U.S. and E.U., and China can probably find sufficient trading partners within Asia, Russia and South America.

Increasing trade barriers reduces international co-operation which is required to tackle pandemics, climate change and conflict.

deglobalisation isn’t the answer

Globalisation since the 1990s has increase wealth but this wealth hasn’t been distributed equally which is a problem.

Rather than pursuing anti-globalist policies such as introducing subsidies which put up barriers to trade governments would be better off focusing on fairer taxation and redistribution policies to ensure that everyone can benefit from the increased wealth that increased global trade has generated.

The last 40 years have witnessed a form of neoliberal globalisation in which national governments have entered into a race to the bottom with corporate taxes: offering lower and lower taxes to attract investment.

This has lead to massive technology shifts around the world and mass deskilling of populations as more and more jobs have become automated, which has contributed to increasing inequalities withing countries, and low taxes have meant governments haven’t been able to reinvest sufficiently to make up for the disruption caused by these changes.

At the same time failure to tackle tax havens has allowed huge amounts of international capital to flow freely out of nation states.


The World Trade Organisation is now talking about reglobalisation: globalisation with a human face so that it’s more inclusive.

This might involve the following:

  1. A global agreement on a minimum global corporate tax and getting rid of tax havens. This should work as companies are more interested in stability, infrastructure and a skilled workforce.
  2. Governments need increased tax revenue so they can invest in infrastructure and education so as to pass on the benefits of global trade to more people.
  3. Diversifying supply chains may still help with poorer countries, and reskilling poor people in rich countries.
  4. We need to strengthen co-operation in some aspects to tackle three large global problems: climate change, pandemics and conflicts.

Turning our backs on globalisation won’t bring jobs or improve security or solve climate change, and it also threatens global peace!


This material is mainly relevant to the globalisation and global development module within A-level Sociology.

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This post is a summary of a Radio 4 Analysis podcast: The Death of Globalisation?

This was hosted by Ian Goldin, Professor of Globalisation and Global Development at the University of Oxford.

The Hyper Globalist View of Globalisation

hyper globalists argue globalisation is a positive process of economic growth and increasing prosperity for the majority and the spread of democracy.

Hyper-globalists (sometimes referred to as global optimists) believe that globalisation is happening and that local cultures are being eroded primarily because of the expansion of international capitalism and the emergence of a homogeneous global culture; they (as the ‘optimist’ part of the label implies) believe that globalisation is a positive process characterised by economic growth, increasing prosperity and the spread of democracy.

Hyper-globalism (1)

Thomas Friedman (2000) argues that globalisation has occurred because of the global adoption of neoliberal economic policies. Neoliberalism insists that governments in developing countries need to remove obstacles to free trade and free market capitalism in order to generate development. Governments should limit their role to providing a business-friendly environment that enables businesses (both inside and outside the country) to make a profit.

The theory is that if governments allow businesses the freedom to ‘do business’, wealth will be generated which will trickle down to everyone.

Friedman identifies a neoliberal economic set of principles that he calls the ‘golden straight jacket’ that countries need to fit into if they are to achieve success in the global economy: deregulation, fewer protections for workers and the environment, privatisation and cutting taxes.

Friedman argues that the golden straitjacket is “pretty much one size fits all… it is not always pretty or gentle or comfortable. But it’s here and it’s the only model on the rack this historical season’.

Friedman attributes economic globalisation to the fact that most developing countries have adopted neoliberal policies since the 1980s. Neoliberalism has effectively restricted the power of nation states, making trade between nations easier. It has resulted in the freer movement of goods, resources and enterprises, and ultimately more jobs, cheaper products and increasing economic growth, prosperity and wealth for the majority of people on the planet.

These countries were often shepherded onto the ‘right’ economic path by the ‘good Samaritans’ of Western governments, especially the ‘three sisters’ of free trade: the IMF, the World Bank and the WTO, global institutions which have played a central role in shaping globalisation according to hyper globalists.

Optimist Globalism

Hyper Globalism: Supporting Evidence

Three pieces of supporting evidence include:

  • increased international trade has generally resulted in improved economic and social development for most countries
  • More cultural globalisation has led to more tolerance and more global events such as the Olympics.
  • There is more democracy and freedom as a result of globalisation
  • There are more global cities today.

More international trade is good

  • This Hans Rosling Video illustrates the relationship between increasing wealth (brought about by trade) and health
  • The case of China’s economic growth – Use this ‘trading economics’ web site to check out how China’s GDP growth over the last ten years (from 2001) appears to be directly correlated with its growth in exports (use the links to the right to change between graphs – you might need to change the years selection around too).
  • China is not the only country benefiting from increasing trade (imports and exports) – China is just one of four nations known as the BRIC Nations (Brazil, Russia, India and China) – 4 up and coming economies that are predicted to be wealthier than Britain by 2050.

Optimists argue that Transnational Corporations are a force for good. Companies such as Apple, Sony, etc bring investment and jobs to developing countries.

The benefits of cultural globalisation

More people around the world are consumers rather than living subsistence lifestyles. Also people increasingly consume similar foods and brands (and shop for them in similar ways). Increasing global tourism is another feature of this. Evidence below…

  • These photos of ‘what the world eats’ – Suggest similar consumption patterns.
  • Coke’s advertising supports the optimist view of cultural globalisation – Advert 1 (I’d like t teach the world to sing…) and advert 2 – The Happiness Bus

Also, sporting events such as the world cup and the Olympics have become more popular.

cultural globalisation olympics
Are the Olympics a good example of optimist globalism?

Globalisation has lead to more democracy and freedom

The spread of Democracy and respect for human rights since the end of WW2 – E.G. The end of colonial rule in Africa, the collapse of communism and the Arab Spring. This is also evidenced in the establishment of the United Nations and the growth of global social movements such as green peace.

The growth of social media (Facebook and Twitter) have lead more freedom around the world.

Global cities

Urban centres which have highly educated, politically engaged middle classes, which relates to Antony Giddens’ concept of Cosmopolitanism.

Signposting and Related Posts 

This material is usually taught as part of the Globalisation and Global Development module, as part of the second year of A-level sociology, but this post should be of interesting to anyone studying Globalisation.

The posts below cover related theoretical perspectives:

Kenichi Ohmae – A radical, neoliberal view of globalisation

What is Cultural Globalisation?

The Pessimist View of Globalisation

The Transformationalist View of Globalisation

The Traditionalist View of Globalisation

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Revision notes on globalisation…

If you like this sort of thing and want some more context on globalisation, then you might like these revision notes on globalisation, specifically designed for A-level sociology. 

Globalisation cover

Nine pages of summary notes covering the following aspects of globalisation:

– Basic definitions and an overview of cultural, economic and political globalisation
– Three theories of globalisation – hyper-globalism, pessimism and transformationalism.
– Arguments for and against the view that globalisation is resulting in the decline of the nation state.
– A-Z glossary covering key concepts and key thinkers.

Five mind-maps covering the following:

– Cultural, economic, and political globalisation: a summary
– The hyper-globalist view of globalisation
– The pessimist view of globalisation
– The transformationalist/ postmodernist view of globalisation.
– The relationship between globalisation and education.

These revision resources have been designed to cover the globalisation part of the global development module for A-level sociology (AQA) but they should be useful for all students given that you need to know about globalistion for education, the family and crime, so these should serve as good context.

They might also be useful to students studying other A-level or first year degree subjects such as politics, history, economics or business, where globalisation is on the syllabus.