We often buy goods and services that have a stamp for their country of origin - Made in Britain, Made in China, and so on - but how often do we think about exactly what this means? There was an interesting note on the Interactive Investor web site this week that poses this question from the perspective of an investor (See Article).
The main tenor of the article was to argue that an investment in the largest of companies (e.g. the FTSE 100 in the UK) is, actually, an investment in the world economy, only from a peculiarly British slant, as British companies bring all of the baggage of the British commercial heritage.
In many ways, this is quite a natural development. As globalisation progresses, we would naturally expect there to be a larger incidence of inter-connected companies. What is, perhaps, most interesting is the degree to which non-European countries (especially Australia and South Africa) are integrating with UK companies. The integration of European companies with UK companies is to be expected as the process of European Integration gathers pace at the commercial, if not the political, level. We can expect this process to continue more rapidly.
From what we can see so far, this distinguishes Globalisation 2 (G2 - which ended in 1914) from Globalisation 3 (G3). G2 involved a dramatic increase in world trade, but without the financial integration that is accompanying G3. This has to be a good thing, because it reduces the chances of G3 ending as unhappily as G2. Certainly, there are still many factors that could blow G3 off course, but most people reading this post will have an interest in keeping G3 on track. This is something that continues to underwrite our prosperity.
In the end, does the country of origin matter? In many ways, this is a litmus test for how we view the future. If it does matter, then we are unlikely to progress that far from the nationalistic divisions that blighted most of the twentieth century. If it doesn't matter, there is a chance that we may have moved on from that point.