A longitudinal analysis of globalization and regionalization in international trade: A social network approach

Although there have been heated debates over globalization and regionalization, refined empirical research has been lacking. Defining globalization and regionalization as specific types of linkages between countries, we attempt to empirically examine the following. (1) Has the world been globalized and/or regionalized? and (2) If it has, what are the consequences of these processes? To explore these questions, we analyze longitudinal data on international commodity trade using the social network approach. Data analysis shows that the world became increasingly globalized between 1959 and 1996 in the sense that each country studied traded with more countries in 1996 than in 1959. As a result, the world trade network became denser. At the core of this process has been the development of countries in the middle strata. We also find that the Structure of the world trade network became decentralized over time, a change that provides greater support for neoclassical economic theory than for world-system/dependency theory. Regarding regionalization, we find that intraregional density is greater than interregional density and that intraregional ties are stronger than interregional ones. Moreover, both intraregional and interregional density increased significantly between 1959 and 1996, indicating, first, that the flow of world trade became regionalized and, second, that globalization and regionalization are not contradictory processes.