The historical background of contemporary globalization

After reading the history of globalization, everyone should understand that globalization is not a straight road that only moves forward and never retreats. Globalization requires historical conditions and institutional foundations. This section will talk about the background of the peak of contemporary globalization.

The rise of Anglo-American neoliberalism

In 1979, Mrs. Dayall of the United Kingdom led the Conservative Party in power and advocated the so-called "withdraw the government from the market." Policies include the privatization of state-owned enterprises and the reduction of government spending, which promoted the rise of so-called neoliberalism. After President Reagan took office, he extensively implemented reforms such as tax cuts and fee reductions, encouragement of private enterprise competition, and reduction of market regulation.

The Soviet Union collapsed

While the United Kingdom and the United States pushed forward the administrative reform, the communist formation headed by the Soviet Union was gradually disintegrating. In 1989, the Berlin Wall fell, symbolizing the end of the era of world division since the Second World War. Since then, the world’s political barriers have been greatly reduced, laying the foundation for the peak of globalization.

New competition and flexible production

At the beginning of the 1980s, Japan challenged American companies with its high-efficiency production. American companies were forced to reorganize and began a long road of economic transformation and corporate reorganization. An important result of enterprise restructuring is flexible production and enterprise outsourcing. In order to increase productivity and reduce costs, companies no longer do all the processes. Instead, the process is outsourced. In the process of outsourcing, companies are constantly looking for lower-cost companies for OEM production, thereby sub-contracting processes to all over the world, forming today's global production network.

The rapid advancement of information technology

After the Second World War, military science and technology made a great leap forward, and civil science and technology also achieved rapid development. Among them, the development of computerization, telecommunications popularization, miniaturization, and digitization has not only greatly reduced the cost of call and data transmission, but also greatly increased the speed and transmission volume, enabling individuals and enterprises to maintain close contact with all parts of the world at low cost. Similar to information technology, the great leap forward in shipping technology after the war, civil aircrafts, containers, ocean-going ships, etc., all reduced the cost of cross-border transportation and became the basis of globalization.

The rise of transnational media

During the Cold War era, television and radio were classified as regulated industries in many countries. With the opening up of politics and technological progress, electronic media such as satellites, the Internet, and television enabled the world to see and hear all kinds of things instantly. The rapid development of globalization.

Reform of the capital market

The United States only began to loosen capital flow controls in the late 1970s. In the following 20 years, developed countries gradually eased capital controls. Only when the financial markets of various countries can be connected can the world financial market become possible, and investors can buy and sell all over the world. .