Globalization has been a force that has dominated the second half of the twentieth century in Europe and the world and markedly impacted history. Although we hear this word bandied about constantly, what does it mean? What led to globalization in Europe and the world, and what were the effects of globalization in Europe? Learn about globalization in Europe and some of the broad trends it has led to here.
Conceptualizing and Defining Globalization
Before we consider examples of globalization in Europe and the effects of globalization in Europe, let's first consider what globalization means.
Globalization is primarily a socioeconomic force. However, it has had an impact on culture, politics, and international relations as well.
Globalization
Globalization is when businesses and other organizations operate internationally and have an international reach and influence. Some definitions of globalization also include political and cultural integration.
It's worth pointing out that there are arguments to be made that globalization, especially in an economic sense, is not a strictly 20th-century phenomenon.
For example, even as far back as medieval times, extensive international trade networks developed from the Silk Road and medieval trading towns. European colonization, first of the Americas and then of Africa and Asia, further contributed to an interconnected world through trade and the dissemination of ideas.
However, the latter half of the 20th century saw a rapid increase in globalization. No longer did goods and ideas flow between faraway places, but the societies to and from which they flowed became more interconnected.
New technologies for transportation and communication meant people could more readily adopt similar lifestyles and international brands that were as much a cultural marker as an economic good emerged.
Earlier, it may have been common for goods or raw materials from abroad to become part of people's daily lives, for example, coffee, sugar, or bananas imported from abroad. However, the late 20th century saw the rise of brands such as Nike, Coca-Cola, and Apple to transcend national borders in ways that did not occur before.
This economic integration led to political cooperation and cultural transformation as well. Globalization in Europe only increased after the end of the Cold War in the 1990s.
Fig 1 - The late 20th century saw rapid globalization in Europe and the world.
Examples of Globalization in Europe
The examples of globalization in Europe reveal how economic interconnectedness lent itself to social, political, and cultural integration.
Rise of the European Community
A few critical factors contributed to the rise of the European Community after World War Two.
Europe had been devastated by two world wars, and there was a desire to rebuild its damaged economies and provide stability to prevent future conflicts. These two desires played a vital role in the integration and globalization of Europe.
The Marshall Plan Heralds Integration of Western Europe
The US provided ample funds to rebuild Europe in the Marshall Plan. Besides stimulating the rebuilding of Europe's economy, it had two other essential impacts on European globalization.
First, it opened European markets to more US goods. Second, it promoted cooperation among the receiving countries, marking the beginning of proper economic policy coordination. The Organisation of European Economic Cooperation, or OEEC, was created to encourage coordination and cooperation in the administration of Marshall Plan Aid.
The OEEC led directly to the creation of the more globally minded Organisation for Economic Co-operation and Development, or OECD, in 1961, which included the US, Canada, Australia, New Zealand, and Japan, and eventually expanded to have much of Eastern Europe and some countries of Latin America.
Fig 2 - A poster created for the Marshall Plan in 1947.
The European Union
The OEEC was also an essential catalyst for the creation of the European Union.
The European Economic Community, or EEC, was created by the 1957 Treaty of Rome to move beyond cooperation to complete economic integration.
The European Union, or EU, grew out of the EEC by signing the 1992 Maastricht Treaty.
Fig 3 - Map showing EU member countries.
The EU is, by definition, a customs union and single market.
That means there are no trade barriers, such as tariffs between member countries, and the members set external tariffs towards other countries in unison. Essentially, they operate as a single bloc or almost as if they were one unified country for international trade.
Tariffs
Tariffs are taxes put on imported or exported goods. They encourage domestic production over foreign trade.
Not all, but many of the EU member countries have also adopted the Euro as a common currency.
Euro
A common currency used by 19 of the 27 EU member countries. They use the Euro instead of their national forms of money.
However, the impact of the EU goes beyond economics. The European Parliament also operates under the EU and promotes social integration and cooperation among member states on common laws and policies.
The Schengen Area
Although closely associated with the EU, the Schengen Area is technically separate. Not all members of the EU are members of the Schengen Agreement, and not all members of the Schengen Agreement are members of the EU, although most are members of both.
The Schengen Agreement was signed in 1985, first between 5 countries but now includes 26 participants. The countries in the Schengen Area have essentially abolished international borders, and people can pass between them without needing to acquire visas or even show a passport.
Fig 4 - The border between Austria and Germany, participating members of the Schengen Agreement allowing free movement across borders.
Effects of Globalization in Europe
There have been many effects of globalization in Europe.
Increased Trade and Access to New Technologies
The primary effect of globalization in Europe has been increased trade, both within Europe and between Europe and the rest of the world.
In addition to more varied foods and goods, European globalization also opened access to new technologies. The telephone, radio, and television contributed to spreading and mixing cultures and ideas in the mid-twentieth century. It allowed people across borders to communicate more efficiently, enjoy similar entertainment, and provide access to news and views that people can hold in common.
In more recent times, the computer, internet, cell phones, and the advent of social media only strengthened these connections. Increased adoption of the automobile and, more importantly, the ubiquitousness of travel by airplane made it even easier for people to feel more connected through the journey.
These technologies not only facilitated further trade and exchange of ideas but also made the barriers between people, such as borders, seem less defined. The creation of a single market in Europe and the free movement of people in the Schengen Area only further contributed to this dynamic.
Peace and Security
One of the underlying goals of reducing trade barriers was to promote peace in Europe. That goal has largely been successful. There has not been a major war on the scale of the World Wars in Europe, and globalization in Europe is at least one factor.
Economic cooperation and collaboration also contributed to diplomatic and political affiliation through the EU and European Parliament and organizations like the United Nations and NATO.
NATO
The North Atlantic Treaty Organization was created initially as an anti-Soviet military alliance. After the end of the Cold War, the organization adopted a broader goal of security collaboration between Europe and the US.
Fig 5 - Former US President Obama with Angela Merkel and other European leaders.
West European Politics in the Age of Globalization
The more prolonged effects of globalization are straightforward to observe in Western Europe. West European Politics in the Age of Globalization have primarily coalesced around the broad acceptance of free trade, parliamentary democracy, liberal social policies, and capitalist economic systems.
While every country has its dynamics and internal politics, it's not an overgeneralization that West European politics in the Age of Globalization largely follow those broad strokes. Since the fall of communism, Eastern European countries have adopted similar socioeconomic and political systems.
Have There Been Negative Effects of Globalization in Europe?
Discussing the positive or negative effects of globalization in Europe can be tricky. Globalization is, in and of itself, a neutral phenomenon. Whether people view its impact as a positive or negative effect of globalization in Europe is primarily a matter of perspective.
However, it has brought unique challenges and dynamics that some see as adverse effects of globalization in Europe.
Culture and Conflict in a Global Europe
While globalization and the advent of cooperation through organizations like the EU have primarily led to relative peace compared to the first half of the 20th century or earlier European history, the era has not been free from conflict.
Even as many economies and societies became more closely integrated, nationalism remained a powerful force. The Troubles in Northern Ireland, wars in the Balkans that led to the breakup of Yugoslavia, and separatist movements in Spain are all examples of the intersection of culture and conflict in a global Europe.
As globalization in Europe has expanded to include Eastern Europe, especially in former close allies of the Soviet Union, Russia has responded with trepidation to the increased alignment of these countries with Western Europe. These concerns are a crucial factor in the Russian invasion of Ukraine in 2022.
Another critical challenge and example of the clash of culture and conflict in Europe is the debate over the integration and role of immigrants in European societies. This has especially been the case as famine, drought, climate change, and wars have driven immigration to Europe from Northern Africa and the Middle East.
While much of Europe has adopted policies of open borders between them and even towards refugees from wars in places like Syria, there has been a backlash in some countries towards them.
In France, there has long been a debate about the place of Islamic immigrants. Many immigrants came from the former French colony of Algeria in the 1960s and 70s, and many lived in impoverished communities. Debates over the hijab headscarf in public schools and elsewhere in France are one example of the type of challenges globalization has caused in Europe.
Economic Crises Spread Across Borders
While increased economic integration has led mainly to increased trade and shared prosperity, the interdependence of economies can also compound financial problems. Problems in one country can more easily spread to others.
2008 Global Financial Crisis
The 2008 Global Economic Crisis highlighted the negative effect of globalization.
A crisis that began in the banking system of the US spread around the world. Several European countries, including Greece, Spain, Ireland, Portugal, and Cyprus, struggled to pay their international debt and required bailouts from other European countries.
Especially in Greece, the debt crisis had significant adverse effects.
These issues led to some questioning the long-term health of the EU and the Euro as a common currency. Concerns over economic independence were one factor, along with immigration, in the United Kingdom's withdrawal from the EU (commonly referred to as Brexit), leading to financial instability throughout Europe.
Fig 6 - Anti-globalization protests in Athens in 2006.
Anti-Globalization Politics
Political movements opposing globalization in Europe have emerged on the left and right.
Green parties have challenged what they consider to be the in-sustainability of globalization. Other political movements on the left, such as the European Social Forum, have broadly emerged as anti-consumerist and anti-globalist.
Meanwhile, immigration, especially of Muslims, has contributed to the growth of right-wing nationalist parties in some European countries in the early 21st century.
European History - Globalization in Europe - Key takeaways
- Globalization in Europe and beyond has been a significant characteristic of the second half of the 20th century, significantly accelerating after the end of the Cold War in the 1990s.
- Globalization in Europe can be defined as the increased integration of Europe's economies and the global reach of businesses and organizations beyond traditional national borders.
- European globalization includes the European Union, the Euro, and the Schengen Area.
- Effects of globalization in Europe include increased trade, increased integration of culture, and, broadly speaking, increased peace and prosperity.
- However, there are arguably some adverse effects of globalization in Europe, among them the clash of cultures and debates over immigration, as well as the ripple effects of economic difficulties in one country spreading to others.
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