Globalisation, International Trade and International Cooperation

Globalisation is a multi-dimensional concept. We shall begin by exploring different angles from which it can be understood and how the module is organised.

The development of the current international trade and financial system has been driven by the need for multinational corporations to securely conduct business transnationally and the states' need to integrate international business into their economic policies. In this session we shall see how these micro- and macro-economic forces have shaped the current international financial system.

In order to secure the trade with the colonies significant investments were required which exceeded the State's sole financial capacity. Hence, private investors organised themselves in new forms of corporations allowing for increased capital provision and reduced risk.

Until World War One the European empires were the uncontested leaders of the global economic development. This situation started to decline as from the moment they challenged each other's power at an industrial scale and with the abandonment of the gold standard.

At the end of the second world war the victors prepared for the post-war political and economic organisation of the world. From these negotiations emerged the United Nations and the “Bretton Woods” organisations. This evolution will be analysed in parallel with the emergence of the modern multinational corporation and the petrodollar environment.

The International Monetary Fund (IMF), the World Bank (WB) and the General Agreement on Trade and Tariffs (GATT) are the institutions initiated at the Bretton Woods conference. We shall have a look at their respective missions and governance structures. But first we have to respond to the question: "Why is a global governance of trade needed?"

The GATT and it's successor, the WTO have been the driving forces behind trade liberalisation during the last 70 years. However, the increasing complexity of the services and product exchanged throughout the world and the ever accelerating rate of innovation are increasingly challenging to the agreement on multi-lateral accords.

Globalisation has developed as a dialectic between bottom-up and top-down, local and global, centralised and distributed networks. We shall see in these sessions how this dialectic has developed over time.

The main factors of economic globalisation have been the liberalisation of the capital markets and the integration of international supply chains. We shall see how both these trends are being challenged by new forms of interventionism and protectionism.

It appears that the architecture of the post-WW2 global institutions is showing weaknesses in the current circumstances. However, new trends have emerged that are leading to further globalisation, such as the climate change, regional economic integration, etc …

Demographic shifts, environmental concerns, political competition, are sources of questioning of the benefits of globalisation. The last decade has seen a resurgence of nationalism that is may have significant consequences for the re-balancing of the world economy in the short and medium term.

New energy policies and new technologies, such as blockchains and artificial intelligence are reshaping our economies at a rapid rate. We shall investigate what consequences may be expected from these developments on the economies in the foreseeable future.

Some commentators and academics warn that our current institutions are ill-designed to absorb the radical shifts our economies will face in the coming decades. The pace of change is such that we may have to radically extend our perspective beyond the globe and an anthropocentric view of the world.

The last sessions of the course will be dedicated to an interactive discussion about the future of our current institutions and the question wether the concept of globalisation still is relevant within the perspective of the students' expected life span.