4. Spain in the First Economic Globalization (1890–1914)

The combination of lower tariffs and technological breakthroughs in land and maritime transport made international trade much cheaper. It was reinforced by the diffusion of the gold standard. For a quarter of a century, the world experienced an unprecedented economic globalization, with massive movements of goods, labour and capital. Spain missed some of the available opportunities. The transport revolution played against domestic agriculture triggering a great agrarian depression. Large free trade agrarian and manufacturing interests turned to tariff protection. The loss of the last overseas colonies made things worse. Luckily enough, the formation of the modern business enterprise and the start of the second industrial revolution made Spanish investment attractive as Spain had a weak exchange rate. Nevertheless, a slow divergence with Western Europe was the dominant trend until 1913.