Dynamics of Globalization at the Crossroads of Economics

by Ahmet Arif Eren (Volume editor) Altuğ Murat Köktaş (Volume editor)
©2019 Edited Collection 444 Pages


The world is becoming interconnected via the increase in the volume of trade. This integration process is called globalization, and this led to a massive increase in the production of goods and services. The globalization process has many dimensions such as cultural, social and political. This book mainly aims to investigate the economic aspect of globalization and focuses on trade patterns.

Table Of Contents

  • Cover
  • Title Page
  • Copyright Page
  • About the author
  • About the book
  • Citability of the eBook
  • Contents
  • List of Contributors
  • An Analysis on Politics during Different Phases of Capitalism from Liberal Capitalism to Statist Capitalism
  • Terms of Trade in Foreign Trade Theory and Singer-Prebisch Thesis
  • Promotion of International Trade
  • Underdevelopment and Foreign Trade Policies
  • Globalization and Non-tariff Barriers: Neo-Mercantilism
  • The Impact of Trade Openness on Economic Growth: Example of BRICS Countries
  • Foreign Direct Investment and Foreign Trade Nexus: Example of Turkey and the BRICS Countries
  • The Might of Tinbergen Law: The Gravity Model of the European Union’s Trade Flows
  • International Trade and Energy Interactions in the G7 Countries
  • The Effect of Globalization in the Birth of International Trademarks
  • Additional Financial Liabilities Applicable within the Context of International Trade in Turkey
  • Latin American Exporting Firms in the Global Economy: The Case of Argentina, Bolivia, Colombia, Peru and Dominica
  • Multifactor Productivity and Financial Development
  • The Dynamic Relationship between Economic Growth and Shipping Trade: Evidence from Panel Vector Auto Regression
  • Relationship between Oil and Gold Prices: Evidence from the Toda–Yamamoto Causality Test
  • Institutions and International Trade: A Literature Survey
  • The Impact of Customs Union on Direct Foreign Investments: The Example of East African Community
  • Immigrant Entrepreneurs as Economic Contributors and Diversity Factors of International Trade
  • Secular Stagnation: An Overview of the Current Issue on the Global Economy
  • Financing of Global Public Goods: The Case of Syrians in Turkey
  • Globalization and Health: An Evaluation on Turkey
  • Creating Brand Loyalty in Health Care and the Case of Aydın Adnan Menderes University, Practice and Research Hospital
  • Empowered Patients as an Influence of the Digital Age
  • Relationship between Economic Growth and Health Expenditures: Review on BRICS-T Countries
  • Using the Simulation Technique Approach towards Queuing Problem in Health Care Systems: A Public Hospital Application
  • The Impact of Globalization and Economic Growth on Environmental Pollution: An Econometric Analysis
  • Economic Globalization and CO2 Emissions Relationship: The Evidence from Turkey
  • Fiscal Devaluation Practice in Turkey: The Period of 1985–2016
  • As a Global Tax Proposal: Tobin Tax
  • Budget Deficit, Private Savings Gap and Current Account Deficit Relations: Triple Deficits Case
  • Fiscal Rule in Greece during Current Crisis: Different Parties Same Politics
  • Reform Transfer in Local Governments within the Context of Central Government – Local Government Relationships
  • Price Bubble and Housing Construction Sector in Turkey
  • The Impact of Military Expenditures in Turkey and Some NATO Countries on Financial Balance and Current Account Balance (1978–2018): A Dynamic Panel Data Analysis15
  • IInd Constitutional Period and Approach of Ittihat Terakki to International Economics
  • Approach of Kadro Magazine to the Great Depression and International Economics
  • Role of International Security Organizations in the New World Order
  • Industry Performance Analysis of the Developed and Developing Economies
  • The Legal Consequence of Globalized World: The Implementation of QR Codes on Checks in Turkish Legal System

List of Contributors

Assist Prof. Dr. Seda Ekmen Özçelik (Ankara Yıldırım Beyazıt University)

Assist. Prof. Dr. Ahmet Kamacı (Bartın University)

Assist. Prof. Dr. Ayşe Ergin Ünal (Tarsus University)

Assist. Prof. Dr. Cenap Mengü Tunçay (Ankara Hacı Bayram Veli University)

Assist. Prof. Dr. Dilek Durusu Çiftçi (Pamukkale University)

Assist. Prof. Dr. Fatih Hakan Dikmen (Ankara Hacı Bayram Veli University)

Assist. Prof. Dr. Hikmet Selahaddin Gezici (Selcuk University)

Assist. Prof. Dr. Musa Atgür (Necmettin Erbakan University)

Assist. Prof. Dr. M. Sami Süygün (Tarsus University)

Assist. Prof. Dr. Zeynep Ağdemir (Ahi Evran University)

Assist. Prof. İnan Akdağ (Amasya University)

Assist. Prof. Samet Evci (Osmaniye Korkut Ata University)

Assist. Prof. Dr. Yasemin Dumrul (Kayseri University)

Assist. Prof. Dr. Zerrin Kılıçarslan (Kayseri University)

Assoc. Prof. Altuğ M. Köktaş (Ahi Evran University)

Assoc. Prof. Çağdaş Erkan Akyürek (Ankara University)

Assoc. Prof. Dr. Dilek Başar (Hacettepe University)

Assoc. Prof. Dr. Emre Güneşer Bozdağ (Ankara Hacı Bayram Veli University)

Assoc. Prof. Dr. Korhan Karacaoğlu (Nevşehir Hacıbektaş Veli University)

Assoc. Prof. Dr. Merter Akıncı (Ordu University)

Assoc. Prof. Dr. Mustafa Kocaoğlu (Necmettin Erbakan University)

Asst. Prof. Baki Yeğen (Niğde Ömer Halisdemir University)

Asst. Prof. Dr. Ayberk Nuri Berkman (Niğde Ömer Halisdemir University)

Asst. Prof. Dr. Hüseyin Kutbay (Karamanoğlu Mehmet Bey University)

Asst. Prof. Dr. Özgür Özmen (Nevşehir Hacıbektaş Veli University)

Asst. Prof. Dr. Said Ceyhan (Bartın University)

Asst. Prof. Dr. Selçuk Buyrukoğlu (Sivas Cumhuriyet University)

Asst. Prof. Dr. Bilge Doğanli (Adnan Menderes University)

Asst. Prof. Dr. Bilgen Taşdoğan (Aksaray University)

Dr. İsmail Çakmak (Ordu University)

Asst. Prof. Dr. Özlem Öztürk Çetenak (Niğde Ömer Halisdemir University)

Dr. Tuğay Günel (Çukurova University)

Dr. Yavuz Yayla (19 Mayıs University)

Dr. Zehra Doğan Çalışkan (Abant İzzet Baysal University)

Dr. Zühal Kurul (Hacettepe University)

Health Specialist Orhan Parıldar

Latif Özdoğan (Niğde Ömer Halisdemir University)

Lecturer Emrah Noyan (Pamukkale University)

Lecturer Mehmet Özgün (Pamukkale University)

Lecturer Mustafa Alpin Gülşen (Akdeniz University)

Prof. Dr. Ömer Yılmaz (Atatürk University)

Res. Assist. Ali Gökhan Gölçek (Niğde Ömer Halisdemir University)

Res. Assist. Bestami Karakahya (Abant İzzet Baysal University)

Res. Assist. Erdinç Kalaycı (Ankara University)

Res. Assist. Halis Karademir (Niğde Ömer Halisdemir University)

Res. Assist. Havanur Ergün Tatar (Bartın University)

Res. Assist. Mehmet Çakmak (Abant İzzet Baysal University)

Res. Assist. Rabia Efeoğlu (Niğde Ömer Halisdemir University)

Res. Assist. Şeyda Güdek Gölçek (Niğde Ömer Halisdemir University)

Res. Assist. Mehmet Sinan Çelik (Niğde Ömer Halisdemir University)

Seyhan Inci (Adnan Menderes University)

İnan Akdağ

An Analysis on Politics during Different Phases of Capitalism from Liberal Capitalism to Statist Capitalism

1 Introduction

On September 15, 2008, many persons announced the end of liberal world capitalism or at least they declared the death of neoliberal ideology because of the bankruptcy of Lehman Brothers and totally collapse of global financial system (Apeldoorn and Overbeek, 2012: 1). The 2008 economic crisis seemed to spread idea about the ending phase of liberal capitalism, which had started after the 1980s. Then the answer to the question about what would come is being searched. Indeed, the answer is embedded in the history. Historically, economic oscillations give the answer to us. When the history is analysed, after the birth of modern capitalism, liberal and statist capitalisms follow each other as being phases. Therefore, the new phase is being discussed whether it is a new statist economic order or not. This chapter is completely about capitalist oscillations and politics during these oscillations.

In the field of economics, historical and structural developments display that statist capitalism started to rise after the 2000s. Dialectically, all new periods emerge before this period. When the statistics is analysed, it is seen that in 2006, there were six state companies among the biggest hundred companies in the world (MacDonald and Lemco, 2015: 6). In 2013, the state companies reached to twenty among hundred biggest global companies (MacDonald and Lemco, 2015: 6). In addition, in 2013, there were three state companies among the global biggest ten companies (MacDonald and Lemco, 2015: 6). With these statistics, it can be seen that the numbers of state companies rapidly rise in economy. These state companies have generally emerged in developing countries such as China, Russia, Mexico, Brazil and so on. In this framework, the statist capitalism became reality after the 2000s. Historically, modern capitalism has oscillations, and it transforms from liberal capitalism to statist capitalism and statist capitalism to liberal capitalism from one period to another.

There is rapid accumulation in the phase of liberal capitalism, and then there appears excessive accumulation. After the phase of liberal capitalism, there emerges statist capitalism which restores capitalism. If capitalism does not restore itself, masses do not obey capitalist system. Briefly, capitalism has oscillations, from liberal capitalism to statist capitalism. Capitalism has crisis tendency, but statist capitalism has less crisis tendency. It can be seen that during 1945–1971, statist capitalism period, which is labelled as Keynesian Welfare State, there appeared 38 financial crises compared with 139 financial crises during 1973–1997, liberal capitalism or neoliberal capitalism period (Bresser-Pereira, 2010: 509). Another statistics is that the world experienced 1 banking crisis during 1947–1975 and that there appeared 31 banking crises during 1976–2008 (Bresser-Pereira, 2010: 509).

Phases of capitalism shape not only economy but also politics. Politics is formed by class struggle both between lower and upper classes and among different bourgeoisie fractions. Class struggle and class compromise lead to dominant political structure. Struggle between lower and upper classes brings about democracy or dictatorship orders. On the other hand, class struggle among different bourgeoisie fractions leads to liberal or statist capitalist orders. Compromise among classes is resulted with different political structure, all of which shape dominant politics. Right political or left political structures are sourced from class arrangement.

The main aim of this study is when the evolution of capitalism is historically analyzed, phases of liberal and statist capitalisms are natural elements of capitalism and politics shapes from these phases. The hypothesis of this study is that empirically liberal and statist capitalisms follow each other, and that politics during these phases forms from them. The importance of this study is to show that liberal capitalism, idea of liberal thought, is an illusion, that statist capitalism follows liberal capitalism in order to solve the problems which sourced from liberalism, and politics is a compromise between the left and the right which has taken shape by phases of liberal and statist capitalisms. The scope of this study is modern capitalism period.

2 Studies on the Periodization of Phases of Capitalism: Literature

Phases of capitalism from liberal capitalism to statist capitalism are defined by some authors. These phases are determined by liberal and Marxist thinkers. Mercantilist, physiocrates, laissez faire defenders and finally Marxists put forward phases of capitalism. Marxist thought has separated capitalism into free competitive capitalism and monopoly capitalism. Monopoly capitalism is thought as statist capitalism in Marxist approach. The thought of statist capitalism of Marxist approach goes back to Karl Marx’s ideas. When Marx analysed free competitive capitalism, he made important contributions to analysis of capitalism, which had defined monopoly capitalism before it was reality. His analysis was based on capital centralization and capital concentration (Marx, 2015a: 604). According to this analysis, capital unites at one hand as big groups, in other words it becomes centralization period; on the other hand, it becomes concentrated by pulling individual capitals into few numbers of big capitals. At the end of this period, in the 20th century, big monopolies appeared. Rudolf Hilferding was the first thinker to detect monopolistic features of capital. Hilferding (1981) brought forward that capitalism transformed into finance capital with the new stage of capitalism and that new monopolies which were sources of imperialism appeared. V. I. Lenin, Marxist thinker, (1983: 39) separated capitalism into two forms, one of which was state capitalism and another was private capitalism. According to Lenin, until the 20th century, free competitive capitalism had been dominant capitalist form and after the 20th century, monopoly capitalism became reality. The difference between free competitive capitalism and monopoly capitalism was sourced from production relations. During free competitive capitalism, market was constituted by individual capitals while production was being socialized during monopoly capitalism. At the stage of monopoly capitalism, state regulated free trade and private capitalism (Lenin, 1983: 189). According to Ian Bremmer (2009: 41), state capitalism is a system and in this system state as an economic actor uses market for political gains. In Marxist thought, there are three approaches for state capitalism. These are state capitalism in third world countries, state capitalism in developed capitalist countries and state capitalism in socialist countries. The approach about state capitalism in third world countries puts forward that state capitalism in those countries is a special historical conjectural production, that state capitalism in those countries is the result of anti-imperialist struggles and that state capitalism, although state is intervened in economy, continues the essence of capitalism (Dupuy ve Truchil, 1979: 8). Marxist literature for developed capitalist countries emphasizes that state structure and transformation in terms of classes and that transformation from free competitive capitalism to monopoly capitalism. State power and monopoly capital power are united as one hand in this model. However, private owner and the basic relations of capitalism continued their essence (Dupuy and Truchil, 1979: 15). Finally, in Marxist literature, state capitalism is used for socialist countries. In those countries, state capitalism is different from capitalist countries. In socialist countries, state capitalism is determined by collecting social capital in the hands of the state. Private owner does not find a place in those countries (Dupuy and Truchil, 1979: 22).

Liberal approach is interested in the structure of market, according to which there are two forms of capitalism, liberal market economy and organized market economy (Soskice, 2009: 133). Companies coordinate their activities with hierarchy and competitive market regulations at liberal market economies while companies coordinate their company activities without market relations. Liberal approach uses this label as mixed economy for statist capitalism while Marxist approach uses the term “state capitalism”. After the 1970s with oil crisis, Scott Lash and John Urry (1993) separated capitalism into two forms, organized capitalism and disorganized capitalism. According to Lash and Urry (1993: 3), organized capitalism emerged in the 19th century. Organized capitalism realized with industry, banking and trade capital. Organized capitalism was different from liberal capitalism with the expansion of state and bureaucracy in economy.

The periodization of capitalism has been made by different approaches. This periodization is mentioned in Table 1.

Tab. 1: The Periodization of Capitalism (Tanyılmaz, 2002: 326);







- Liberal (Rostow)


Agriculture, Industry,



- Monopoly Capitalism

Mode of Production

Competitive, Monopolistic



Global Capitalism

(Baran and Sweezy)

- Regulation




Post Fordism

- Long Wave


Late Capitalism


- Long Wave


Kondratieff Waves


In this framework, liberal approach divides capitalism into phases as agricultural, industrial and post-industrial societies while Marxist approach separates capitalism into competitive and monopolistic capitalisms. Regulation school determines capitalism as fordist and post-fordist societies, and finally long wave theory defines capitalism as capitalism and late capitalism.

Relevant literature stresses state role in economy because expansion or limited state determines the structure of capitalism. Marxist thought approaches emphasize the changing role of state in terms of classes while liberal thought emphasizes the role of state in economy. The role of state does not only affect economy but also affects law, politics and ideology. Both Marxist and liberal theory accented the place of state in economy during different social formations.

3 Historical Phases of Capitalism

Capitalism is a living organism. It changes its forms in terms of historical conditions. Historically, with the evolution of capitalism, respectively, free competitive capitalism and monopolistic capitalism became reality. As far as phases of capitalism are concerned, liberal capitalism and statist capitalism historically applied.

According to phases of capitalism, points of view were differently seen on the analysis of them. Liberals refused statist capitalism because of its minimal state understanding. According to liberals, markets can solve all economic problems without state intervention. Statist capitalism leads to expansion of state in economy; therefore, state capitalism is not desired by the supporters of liberalism. However, statist capitalism became active in the real world because of the survival of capitalism. Periodically, capitalism faces with economic crises, and not to lose authority, capitalism has to realize phases of statist capitalism.

Karl Marx (2015b) put forward the law of down tendency of profit rates in his magnum opus Capital. In capitalist system, capital accumulation is the main tendency; therefore, capital wants to accumulate. However, in the framework of the law of down tendency of profit rates, accumulation speed sometimes slows down. To prevent slowing down of accumulation speed, state intervenes in economy. This transformation leads to state-led economy. State-led economy brings about not only accelerating accumulation speed but also reducing violence of class struggle because state with redistribution role distributes add value to lower classes. This mechanism reduces transfer speed of add value from down to up, which lessens the level of class struggle. In addition, the struggle between statist capitalism and liberal capitalism is defined by class hierarchy in dominant power bloc. Conflicts between industrial bourgeoisie and financial bourgeoisie determine phases of statist and liberal capitalisms.

In the world history, periodical capitalist crises lead to transformation among phases of capitalism. Capital to continue its accumulation brings about transitions from statist capitalism to liberal capitalism, after economic crisis whatever its reason is excessive production or financial. From the end of the 19th century to 2008 economic crisis, capitalism has experienced four structural crises. After all crises, capitalism transformed from statist capitalism to liberal capitalism or liberal capitalism to statist capitalism. These crises are 1873, 1929, 1973 and 2008 crises. After 1873 economic crisis from 1896 to 1929 world economic crisis, there appeared liberal capitalism as a dominant capitalist phase. G. Dumenil and D. Levy (2011: 15) determine this period as the first hegemony of finance. Economic structure in this period, free market economy and the sharp development in companies’ organizations are recorded. G. Dumenil and D. Levy (2011: 15) put forward this period as the new compromise between financial sectors and manager classes. This compromise ended with 1929 Big Depression, New Deal and the Second World War. David Harvey also (2010: 221) defines financial capital as dominant power in two periods, one of which was the period from 1890 to 1929 and another was the period after 1973.

After the Second World War, until the end of the 1970s, there appeared the phase of statist capitalism, which was the new dominant class compromise. According to G. Dumenil ve D. Levy (2011: 16), the main features of this period are dominant manager classes among capitalist classes, the expansion of state to the economy – regulation, development, macro politics and low interest rates. This period is labelled as Keynesian Revolution.

After 1973 oil crisis, capitalism transmitted to liberal capitalism again, which was the second financial hegemonic period. This period is named as neoliberal period. This period has continued to today. However, with 2008 economic crisis, this period has been damaged and in the near future statist capitalism may be reality. Protectionism and trade wars may be indicators for the near future.

At this point, Immanuel Wallerstein’s model provides with explanatory framework for capitalist phases. Wallerstein establishes a tie between world hegemony and capitalist phases. Therefore, Wallerstein’s thesis includes political content. According to Wallerstein (2000: 257), all hegemonic forces, at the beginning, defend global liberal order. They want free flow of production factors. They abolish mercantilist restrictions at international trade. Wallerstein explains liberal phases in the modern capitalist system with his model. I. Globalization period during 1820 and 1914 and II. Globalization period after the 1970s that displays liberal and neoliberal periods in the World Capitalist System. However, liberal periods follow by statist capitalist periods because the world hegemon becomes more conservative. Hegemon perceives that the rivals with their cheap labor power are advantageous against liberal trade system of hegemon, and then hegemon prefers protectionist and statist economic model. This tendency is a threat to globalization of economy. However, statist economic model is limited, and at the end of this period, there would appear debt crisis, especially in developing countries. Therefore, whatever phase of capitalism from liberal capitalism to statist capitalism is not immune to crises. Only the reasons of crises change.

Tab. 2: According to G. Dumenil and D. Levy (2011: 20), the Phases of Capitalism;

Profitability crisis

- the 1890s crisis

The first financial hegemony

- 1929 Big Depression

The crisis of financial hegemony

Social Democrat

Keynesian compromise

Profitability crisis

- the 1970s crisis


The second financial hegemony

- The crisis of Neoliberalism

The crisis of financial hegemony

According to table, capitalism sometimes entered domination of financial hegemony, and then statist capitalist period started. This oscillation is related with capital accumulation needs. Crisis is the starting point of phases of capitalism. Under liberal period or financial hegemony, add value transfer from down to up gains speed, and then for restoration phases of capitalism transform into statist period. With statist capitalism, add value is redistributed by state, which reduces class struggle violence.

Tab. 3: Andreas Nölke’s (2012: 119) Capitalist Phases

The 2000s the 1990s the 1980s the 1970s

Financialisation /Neoliberalism

The 1960s the 1950s the 1940s the 1930s


The 1920s the 1910s the 1900s


The 1890s the 1880s the 1870s


The 1860s the 1850s the 1840s

Laissez Faire/Free competitive capitalism

A. Nölke puts the table like Dumenil and Levy’s periodization as well. According to his model, during the last two centuries, capitalism has taken forms, respectively, liberal, statist, liberal, statist and liberal capitalisms.


ISBN (Softcover)
Publication date
2019 (December)
Transportation Trade and devolopment Industrial performance Trade among immigrants Fiscal rule
Berlin, Bern, Bruxelles, New York, Oxford, Warszawa, Wien, 2019. 444 pp., 48 fig. b/w, 93 tables.

Biographical notes

Ahmet Arif Eren (Volume editor) Altuğ Murat Köktaş (Volume editor)

Ahmet Arif Eren is an economist at the Niğde Ömer Halisdemir University. His areas of interest include history of economic thought, history of economics, political economy of capitalism, globalization, and economic sociology.


Title: Dynamics of Globalization at the Crossroads of Economics