Geography Reference
In-Depth Information
6.3.1
Nations and Empires
In many ways, from our perspective of MNEs and economic geography,
the most appropriate date to consider as the start of the modern processes
of globalization - in the sense of the rise of modern global capitalism - was
the beginning of the seventeenth century with the formation of the first
multinational corporations of the Dutch, British and French East and
West India companies (Carlos and Nicholas 1988). Many scholars of the
early globalization eras would perceive the trading company as being of
paramount importance in understanding globalization, with the country
playing instead a very limited role. In the case of the formation of the first
joint stock company - the Dutch East India Company (VOC) in 1602 - it
can be argued that the Dutch state played a major role (Ferguson 2008),
whereas this was to a much lesser extent so in the case of the founding of
the British East India Company in 1603. In general, however, once the
monopoly trading powers were granted to these trading companies, their
actual conduct during the seventeenth and eighteenth centuries was almost
entirely outside of the remit and control of the state. These arguments
would suggest that the role of the financial power of the very first genuinely
multinational joint-stock corporations, in terms of their ability to marshal
people, resources, and weapons, was far more important in driving glo-
balization during the first two centuries of modern globalization than the
role of the nation-state. As such, MNEs have been at the very heart of
the globalization process right from the beginning of the modern era. The
critical role of these companies in spearheading economic globalization
continued apace through the eighteenth and early nineteenth centuries
as international hegemony was slowly transferred from the Netherlands
and Spain to France and Great Britain. During this period the expansion
of the areas under their control by the empires of Great Britain, France,
Russia and Austro-Hungary, as well as the US (Ferguson 2004), provided
increasing resources and inputs into the national economies. The period
spanning from the sixteenth to the nineteenth century represents the era in
which almost all parts of the world came to be dominated to some degree
by the large European powers of France, Netherlands, Spain, Austria-
Hungary, Britain and Russia (Findlay and O'Rourke 2007; Maddison
2006, 2007a). In the case of Great Britain, by the end of the nineteenth
century and the beginning of the twentieth century, eventually one quarter
of the globe was contained in its Empire, in which the supply of raw mat-
erials was provided for by its colonies in return for manufactured goods
produced primarily by Britain itself (Ferguson 2003).
During this period the modern notion of sovereignty which governed
the international relations between these powers first arose, the establish-
