International Trading Component

• The International Monetary Fund (IMF) regards "economic globalization" as a historical process representing the result of human innovation and technological progress
• Silk Road:

  • The oldest known international trade route
  • A network of pathways in the ancient world that spanned from China to the Middle East and to Europe
  • The age of globalization began when all important populated continents began to exchange products continuously both with each other directly and indirectly via other continents and in values sufficient to generate crucial impacts on all trading partners
• • The gold standard became more difficult to maintain during the Great Depression in the 1920s and 1930s, leading to the abandonment of the gold standard by the US government to revive the economy
• The Galleon Trade:

  • Existed during the age of mercantilism from the 16th to the 18th centuries
  • Countries, primarily in Europe, competed with one another to sell more goods in order to increase their country's income
  • Following the lead of the United Kingdom, the United States and other European nations adopted the gold standard at an international monetary conference in Paris in 1867, resulting in a more open trade system
  • The gold standard required countries to back their currencies with fixed gold reserves, making trade easier but still restrictive
• Returning to a pure standard became more difficult as the global economic crisis called the Great Depression started during the 1920s and extended up to the 1930s, further emptying government coffers

  • Economic historian Barry Eichengreen argues that the recovery of the United States really began when the US government abandoned the gold standard, freeing up money to spend on reviving the economy