OK, Maybe Globalization Isn't Dead
Global trade boomed in the 1990s and 2000s, fell sharply during and after the 2008 financial crisis, and then, after a sharp recovery in 2009 and 2010, settled into a pokey, slow-growth trajectory.
Since last summer, though, things appear to have been getting less pokey. According to the monthly World Trade Monitor, maintained by the Netherlands Bureau for Economic Policy Analysis (known in Dutch as the CPB 1 ) and released this morning, the volume of world trade in February was 4.2 percent higher than it was last July.
The index -- which adjusts for, among other things, the commodity-price fluctuations that can make it difficult to detect trends in trade data -- showed a decline in February but a big upward revision for January. The 4.3 percent rise from July to January was the index's biggest six-month gain since 2010.
It's only six months, and maybe it doesn't really mean much. But as somebody who has interpreted the past doldrums in the CPB index and other trade measures as potential signs of an end to globalization or even the dematerialization of the global economy (that is, physical goods being supplanted by data flows), it still seems like I ought to take note. Perhaps those global trade doldrums -- kind of like that thing where millennials supposedly didn't want houses or cars until they did again -- were mainly just an aftereffect of an especially deep, bad financial crisis and global recession. And perhaps now the world is finally climbing out of it, for reals.
I would still bet that global trade won't go back to growing like it did in the 2000s and that economic activity, in developed countries at least, really will keep tilting toward information and services and away from stuff. But cyclical factors still matter a lot, too, and right now the cycle may be the global economy's friend.
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