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Title: A tale of two globalizations: gains from trade and openness 1800-2010

Author(s): Giovanni Federico and Antonio Tena Junguito

Publication Date: February 2016

Keyword(s): openness, Trade and welfare gains

Programme Area(s): Economic History

Abstract: This paper compares the wave of globalization before the outbreak of the Great Recession in 2007 with its alleged historical antecedent before the outbreak of World War One. We describe trends in trade and openness, estimate the gains from trade and investigate the proximate causes of the growth of openness. We argue that the conventional wisdom has to be revised. The first wave of globalization started around 1820 and culminated around 1870. In the next century, trade continued to grow, with the exception of the Great Depression, but openness and gains fluctuated widely. Growth resumed in the early 1970s. By 2007, the world was more open than a century earlier and its inhabitants gained from trade substantially more than their ancestors did. The current wave of globalization, in spite of some similarities with previous trends, has no historical antecedents.

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Bibliographic Reference

Federico, G and Tena Junguito, A. 2016. 'A tale of two globalizations: gains from trade and openness 1800-2010'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=11128