Is this the end of globalization (as we know it)?

ABSTRACT

According to different media and analysts, globalization could be in a phase of ‘slowbalization’, de-globalization or even secular stagnation. After surveying academic proposals for defining, classifying and measuring globalization, by means of the Elcano Global Presence Index, this paper explores to what extent globalization has stagnated and/or whether it has changed its nature. Our results show that globalization has slowed down, but not retrenched. However, economic globalization has lost traction (something that probably explains the general perception on de-globalization) while soft projection has become the main driver of globalization.

KEYWORDS:

• Globalization
• de-globalization
• economic
• military
• soft
• Elcano Global Presence Index

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 See Figge and Martens (2014) and Kacowicz and Mitrani (2016) for comprehensive surveys of globalization definitions.

2 This index is not described in Table 1 as it is made up of other composite indexes, most of which are already surveyed in this exercise.

3 This index was initially intended to explore the external projection of countries, both in volume and nature, as a tool for analysing them from the global governance and/or foreign policy perspectives. The index has been used in academic literature for exploring the projection, global or regional power of countries, their role in global governance and even development processes (see, for instance, Armijo, Mühlich, & Tirone, 2014; Christiansen, 2015; Cohen, 2005; Escribano, 2014; Fan & Shahani, 2014; Fenko & Pozgan, 2017; Jurkiewicz-Eckert, 2014; Malamud, Rodríguez, & César, 2014; Wojciuk, Michalek, & Stormowska, 2015; Zaheer, 2018; Zielinska, 2016).

However, given the high number of countries included in its calculation and, therefore, its high representativeness of the world economic, military and soft systems in terms of GDP and population it can now also be used to understand global trends such as, for instance, the globalization process itself (Olivié & Gracia, 2017, 2018). Moreover, selected indicators are unidirectional –reflecting only one direction of the globalization or externalisation process–, so that all 120 countries’ global presences can be aggregated for obtaining a proxy of the globalization process, in its internationalization facet following Martens et al. (2014) category.

4 This feature is prevalent in the KOF Globalization Index despite its recent methodological update, where de iure and de facto indicators are separated in two distinct composite indicators. The reason is that indexes of diplomatic efforts are part of the de facto sub-index.

5 $\mathrm{\Delta }{C}_{t,t-1}^i=W_{t-1}^i\ast {\mathrm{V}\mathrm{A}\mathrm{R}}_{t,t-1}^i$; where $\mathrm{\Delta }{C}_{t,t-1}^i$ is the variation of the contribution of variable i to aggregate global presence growth; $W_{t-1}^i$is the weight of variable i in aggregate global presence recorded the previous year, and ${\mathrm{V}\mathrm{A}\mathrm{R}}_{t,t-1}^i$ the rate of change of variable i' s value.

6 In this paper, contributions therefore refer to the capacity of variables to drive global presence growth. For their part, weights are variables’ proportions or shares in aggregate global presence.

7 ‘Slowbalisation. The steam has gone out of globalisation’, The Economist, 24/I/2019.

Additional information

Notes on contributors

Iliana Olivié

Iliana Olivié is a Senior Analyst at the Elcano Royal Institute and an Associate Professor at the Department of Applied Economics, Structure and History at Complutense University of Madrid, where she teaches economic development in post-graduate programmes and coordinates the Master's Programme on Strategies and Technologies for Development (Polytechnic and Complutense universities of Madrid). She holds a Ph.D. in Economics (in 2002); she also coordinates the International Cooperation and Development research area and the Elcano Global Presence Index at the Elcano Royal Institute. She is also a member of the Spanish Council for Development Cooperation (a consultation body of the Spanish Administration).

Manuel Gracia

Manuel Gracia is an Analyst at the Elcano Royal Institute, where he works on the Elcano Global Presence Index. He is also an Associate Lecturer in the Department of Applied Economics, Structure and History at Complutense University of Madrid. He holds a Ph.D. in Economics and a Master's Degree in International Economics and Development. He has taken part in a number of research projects related to the European automotive sector, the impact of foreign investment on development in Morocco and Algeria, the processes of production relocation in the EU, and the determinants of productivity and restructuring processes in the Spanish capital-goods sector.