The paper 'Causes of the End of the First Wave of Globalization" is a great example of business coursework. Globalisation is well understood as a universal movement of political, economic, technological and individual connections (Stiglitz, 2002, pg 57). Most countries are said to be globalised when they receive economic empowerment through stable business activities and industrial development. The world has had three waves of globalisation following fiscal stability in the trading sector. It is true that a lot has been said on the causes of such globalisation movements but very little refers to the causes of the end of such economic empowerment.
This paper will, therefore, focus on the causes of the end of the first wave of globalisation. Within this discussion, attention will be paid on the effects of the First World War and the Great Depression which apparently form the foundation of the end of the first wave of globalisation. Most countries were definitely affected by the impacts resulting from these two great events and specifically in the economic sector. However, it will not be prudent enough to explore the causes to the end without establishing some of the characteristics of the wave. Research indicates that the first wave of globalisation was marked by a huge transfer of capital and labour, as well as business involvement in goods, commodities and capital products.
However, all these activities came to an end in 1914 when the First World War set in. It can, therefore, be deduced that the First World War had a big negative impact on the economic stability of most countries that got involved in the war, particularly European and Asian states.
As a result of this war, global investment flow came to a halt as well as trade patterns (Capling & Galligan, 1992, pg 100). This is from common knowledge that fighting countries could not continue carrying out business between themselves as each wanted to protect their economy and win over the opponent. At that time of the war, much movement of goods was taking place using the German submarine. However, this could not continue as a result of the First World War. The most profound effect of the war came about when the Gold Standard was left to ruin.
By the fact that the war prolonged beyond the presumed period, most states decided to abandon the Gold Standard for the one purpose of paying for the war through pursuing a monetary policy which could allow for expansion. This was accomplished through the printing of money that ultimately caused great inflation in most countries’ economy. Therefore, the First World War was an intensive war in terms of monetary expenditure putting most combatant countries at risk of economic instability. Although it should be acknowledged that the First World War had mixed impacts on the economy of Australia, the extensive part of it was negative.
This is what forms the centre of discussion in this paper since they brought the first wave of globalisation to an end. In the first place, it is realized that the war led to the disruption of trade patterns since most countries could not continue carrying out business with each other at the heart of the war. Following this instability in trade prototypes, there was a profound reduction in the Australian exports to the outside world in countries like Britain, France and Belgium.
Even though there was still stability in imports from countries within Asia and the Far East like Japan, reduced exports meant an imbalance in market capital flow. This is because of the falling down of the overall export element of expenditure model. The move had a more negative influence resulting in an economic downturn and therefore, increased unemployment statistics. This required that countries like Australia acted fast enough to recover from economic instability especially in the case of unemployment figures.
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