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The Pace of Globalization

Series: “The Pace of Globalization” by Maximilian Staedtler

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The Pace of Globalization I

The pace of globalization is increasing. And that is good for all of us. Today, we are more inter-connected than at any other date in history. More people communicate, collaborate and compete with each other than ever before.

Globalization is the driving force behind the progress of the human race. Globalization brings peace and prosperity. Globalization is spreading smart ideas at the speed of light and pushing innovations forward. Due to globalization, authoritarian regimes around the world feel pressure to abide by the rules of the international community. The most pressing issues of our time, i.e. overpopulation, resource scarcity (water, food, oil) and climate change, demand a global solution. No country in the world is powerful enough to solve any of these problems on its own. A lack of cooperation between nations in different parts of the world makes measures implemented by one country useless. A great example that demonstrates how prone to failure one-sided attempts are is the climate policy of the European Union. By forcing up prices for emitting carbon dioxide in Europe, the EU might achieve a reduction in European CO2 emissions by lowering demand for fossil fuels, but this has zero effect on global CO2 emissions. Lower demand for oil in Europe for instance achieved through artificially high prices in the EU, is decreasing the pace at which international oil prices would increase otherwise, therefore allowing the rest of the world to consume more (and emit more CO2 emissions) at a lower price. The bottom line is that European efforts to reduce carbon emissions only reduce the pressure on emerging economies to become more efficient and consume less oil. This is what German economist Hans-Werner Sinn calls the “Green Paradox”. (For more on the Green Paradox: http://en.wikipedia.org/wiki/Green_paradox )


The Pace of Globalization II

In his bestselling book “The World is Flat”, New York Times columnist Thomas L. Friedman – one of my favorite authors – analyzes globalization and divides it into three eras:

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