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{{Globalization sidebar}}

'''Trade globalization''' is a type of [[economic globalization]] and a measure ([[economic indicator]]) of [[economic integration]]. On a national scale, it loosely represents the proportion of all production that crosses the boundaries of a country, as well as the number of jobs in that country dependent upon external trade. On a global scale, it represents the proportion of all world production that is used for imports and exports between countries. 

* For ''an individual country'', trade globalization is measured as the proportion of that country's total volume of trade to its [[Gross Domestic Product]] (GDP):<ref name="Brady2011"/> 

::<math>\frac {Imports+Exports} {GDP}</math>

* For ''the world as a whole'', trade globalization is the share of total world trade in total world production (GDP), where the sums are taken over all countries:<ref name="PreyerBös2002"/> 

::<math>\frac {\sum Exports} {\sum GDP}</math>


==Definition==

Preyer and Bös provide a simple [[operationalization]] of trade globalization as "the proportion of all world production that crosses international boundaries".<ref name="PreyerBös2002"/> Chase-Dunn et al. note that trade globalization is one of the types of [[economic globalization]], and define trade globalization as "the extent to which the long-distance and global exchange of commodities has increased (or decreased) relative to the exchange of commodities within national societies", and precisely operationalize it as "as the sum of all international exports as a percentage of the global product, which is the sum of all the national gross domestic products (GDPs)."<ref name="dunn"/> Erreygers and Vermeire define trade globalization as "the degree of dissimilarity between the actual distribution of bilateral trade flows and their [[Gravity model of trade|gravity]] benchmark, determined only by size and distance." <ref name="ErreygersVermeire2012"/> They note that trade globalization would be maximized in a situation where only size and distance affected the intensity of bilateral trade flows - in other words, in a situation where neither [[trade barriers]] nor other factors would matter.<ref name="ErreygersVermeire2012"/>

Babones notes that trade globalization is the indicator of a country's level of globalization most commonly used in empirical literature.<ref name="Ritzer2008"/> Data for most countries in the modern era are available from the [[World Bank]] [[World Development Indicators]] database.<ref name="Ritzer2008"/>

==Trend==

Chase-Dunn et al. note that there have been cyclical waves of trade globalization, with declines corresponding to wars and economic depressions, and that there has been a steady trend over the centuries for trade globalization to increase.<ref name=dunn/> With regards to the modern age, trade globalization increased until 1880, then decreased until 1905, increased again until 1914, decreased during [[World War I]], increased until 1929, decreased until the end of [[World War II]], and has been growing steadily since.<ref name=dunn/> They note that the main explanatory factors in this trend are the continued decline in transportation and communication costs, and stability provided by the "[[hegemony|hegemonic system]]" supportive of trade in recent [[world-systems]].<ref name=dunn/> Decreases can be explained by wars, and periods of conflict and tension often leading to them, where international actors cannot reach consensus on trade agreements and usually give into to [[protectionism]].<ref name=dunn/>

==See also==
* [[Global financial system]]

==References==
{{reflist|30em|refs=

<ref name="Brady2011">{{cite book|author=Brady, David|title=Comparing European Workers: Policies and Institutions|url=http://books.google.com/books?id=zgxLPUv19uYC&pg=PA231|accessdate=1 February 2013|date=19 July 2011|publisher=Emerald Group Publishing|isbn=978-0-85724-932-6|pages=231–}}</ref>

<ref name="ErreygersVermeire2012">{{cite book|author1=Erreygers, Guido|author2=Mieke Vermeire|title=Macroeconomics and Beyond: Essays in Honour of Wim Meeusen|url=http://books.google.com/books?id=0uF6OUUnIA0C&pg=PA165|accessdate=1 February 2013|date=9 December 2012|publisher=Maklu|isbn=978-90-441-2855-0|pages=165–}}</ref>

<ref name="PreyerBös2002">{{cite book|author1=Preyer, G.|author2=Mathias Bös|title=Borderlines in a Globalized World: New Perspectives in a Sociology of the World-System|url=http://books.google.com/books?id=WCEN2FosXw4C&pg=PA18|accessdate=1 February 2013|date=31 March 2002|publisher=Springer|isbn=978-1-4020-0515-2|pages=18–}}</ref>

<ref name="Ritzer2008">{{cite book|author=Babones, Salvatore|editor=George Ritzer|chapter=Studying Globalization: Methodological Issues|title=The Blackwell Companion to Globalization|url=http://books.google.com/books?id=XKnmvRATtfAC&pg=PA148|accessdate=1 February 2013|date=15 April 2008|publisher=John Wiley & Sons|isbn=978-0-470-76642-2|pages=147–149}}</ref>

<ref name="dunn">Chase-Dunn, Christopher; Yukio Kawano; Benjamin D. Brewer. 2000. "Trade globalization since 1795: Waves of integration in the world-system," ''[[American Sociological Review]]'' '''65''' (1): 77-95.</ref>
}}

==External links==
* [http://irows.ucr.edu/papers/irows57/irows57.htm Chase-Dunn, Christopher, and Shoon Lio, "Global Class Formation and the New Global Left in World Historical Perspective"]
* [http://www.irows.ucr.edu/cd/appendices/asr00/asr00app.htm Appendix to "Trade Globalization since 1795: waves of integration in the world-system"]


{{Globalization}}

[[Category:International trade]]
[[Category:Economic globalization]]
[[Category:Economic history]]
[[Category:Economic indicators]]
[[Category:Economic integration]]
[[Category:Globalization terminology]]