Summary: New Books Network - Interview with Harold James

Episode: Harold James, "Seven Crashes: The Economic Crises That Shaped Globalization" (Yale UP, 2023)
Host: Javier Mejia
Guest: Harold James
Date: January 11, 2026

Episode Overview

This episode features a deep discussion between Javier Mejia and Harold James, author of Seven Crashes: The Economic Crises That Shaped Globalization. James, a Princeton historian and expert on the history of economic crises, reflects on seven pivotal global economic shocks since the 1840s, examining how each one re-shaped, deconstructed, or propelled globalization and the world economy. The conversation explores his career path, methodologies, distinctions between supply and demand shocks, and why not all crises lead to fragmentation—some, in fact, renew and deepen global interconnectedness.

Key Discussion Points & Insights

1. Harold James’ Interdisciplinary Career and Intellectual Trajectory

• Academic Background: James started with a focus on the Great Depression in Germany, influenced by key economists at Princeton, including Ben Bernanke and Peter Kennan.
• Interdisciplinarity at Princeton: He describes the vibrant, boundary-crossing environment in the 1980s, where economic history, public policy, and management converged.
  • “It was a dynamic and interesting environment... That’s when I started interested in the story of depressions, how they can reverse globalization, what the future of globalization is.” (03:27)
• Shifts in Historical Discipline: Noting how history has shifted from political to social to economic/cultural over decades, James is optimistic about a return of economic history’s relevance post-2008.
  • “Since the global financial Crisis... there is more interest in economic history in history departments... but many historians don’t really have the skill set to do that.” (06:20)

2. The Role of Crisis: Regeneration vs. Collapse

• Crisis as Change Agent: James views crises not just as moments of tragedy but as engines of transformation, sometimes leading to new forms of organization and globalization rather than stagnation or isolation.
  • “Crises are moments of opportunity where things need to be rethought... the role of government has to be rethought.” (11:08)
• Contrary to Conventional Wisdom: His book pushes back against the idea that crises always lead to deglobalization; some, he contends, actually catalyze new waves of globalization.

3. The “Seven Crashes”: Selection Rationale & Chronology

Why Seven?

• Partly for “number mysticism,” but more so for moments when economic thinking itself changed.
• Excluded WWII, treating it as a downstream effect of the Great Depression.

The Seven Crises (with brief context): (14:12)

1. Mid-19th Century Famine & Shortages (1840s): Triggered the first wave of globalization.
2. Great Depression of 1873: Previously seen as the first “Great Depression”.
3. First World War: Marked a major rupturing and rethinking of global economic order.
4. Great Depression (1930s): Lead to autarky, national self-sufficiency, and WWII.
5. 1970s Oil Shock: Severe inflation and another wave of global integration.
6. 2008 Global Financial Crisis: Renewed interest in macroeconomic stabilization.
7. COVID-19 Pandemic & Russia’s Invasion of Ukraine: Supply shocks and transformation of technology and logistics.

Why exclude WWII?

• WWII is “very much an outcome of the Great Depression... unimaginable without it.” James sees it as a consequence, not a standalone driver. (17:00-18:45)

4. Core Theoretical Insight: Supply vs. Demand Shocks

• Central Thesis: Not all crises are the same. Supply shocks (e.g., shortages or sudden technological shifts) can induce new rounds of globalization, while demand shocks (collapsing consumption/investment) can trigger fragmentation.
  • “Some crises actually push the world in a different direction... more globalization, more interconnectedness.” (10:35)
• Examples:
  • Supply Shocks:
    • 1840s famine & 1970s oil crisis both led to transformative technological adoption (railroads, container shipping, digital tech during COVID).
    • “Each of these three crises... is really prompting a revolution in technology and then a revolution in globalization.” (26:45)
  • Demand Shocks:
    • 1930s Depression and 2008 crisis led to contraction, requiring coordinated governmental/macroeconomic response.
    • “The brilliant diagnosis... by John Maynard Keynes... if you have a deficiency in demand, then you need coordinated action.” (34:00)

5. Differences Between Historical Globalizations

• 19th Century: Driven by flows of agricultural commodities from “the periphery,” paired with imperialism or semi-colonialism.
• Late 20th Century & Beyond: About distributed production, complex supply chains, and eventually, “weightless” digital economies.
  • “The next globalization... is going to be about the application of data and the use of services that can be done in a weightless economy across the world.” (32:22-32:50)

6. “Pseudo Crisis” – The 1873 Great Depression

• Nature of the Crisis: More a result of positive supply shocks and financialization (railroad booms/busts), less a real-sector collapse.
  • “Anna Schwartz... used to use the word pseudo crisis... this is the moment that cements the view... that relative price movements matter...” (38:34)
• Intellectual Legacy: Spurred the birth of marginalism (Jevons, Walras, Menger), moving economics from “political economy” into a focus on relative prices.

7. The Paradox of Non-Crisis Periods & Backlash Mechanisms

• Institutional reforms from crises sow the seeds for later discontent, inefficiency, or backlash—eventually leading to new crisis and new reforms.
• “Any of these processes... lead to institutional reform and to new structures... which gradually produce inefficiencies and injustices... and backlash against globalization.” (43:00-44:05)

8. Looking Ahead: Optimism in Crisis

• Keynesian Note: James ends with an echo of Keynes at Versailles:
  • “All this makes it increasingly probable that things will have to get worse before they can get better... but I, I also wanted to emphasize... they can get better.” (46:01)
• Emphasizes the power of new technologies and popular demand for competence in governance—“we already see the glimpses of a possibly optimistic future.” (47:40)

Notable Quotes & Memorable Moments

• On Interdisciplinarity at Princeton:
  “It was a dynamic and interesting environment... That’s when I started interested in the story of depressions, how they can reverse globalization...” (03:27 – Harold James)

• On Crisis as Rebirth:
  “Crises are moments of opportunity... The role of government has to be rethought. The role of private business has to be rethought.” (11:08 – Harold James)

• On WWII as Outgrowth:
  “The Second World War is... very much an outcome of the Great Depression. I think it’s unimaginable without the Great Depression.” (17:11 – Harold James)

• On the Structure of the Book:
  "I really wanted to think about the moments when economic thinking changed." (13:38 – Harold James)

• On Technology and Supply Shocks:
  “...in the 1970s... container shipping... becomes a big network. You need the container ports in order to be able to do containers. My thoughts about the COVID pandemic... is that this was also a moment when some technologies... got widely taken up.” (24:40 – Harold James)

• On Demand Shocks and Policy:
  “If you have a deficiency in demand, then you need coordinated action above all by governments to remedy that and to supply more demand.” (34:08 – Harold James)

• On Resilience and Future Optimism:
  “They can get better and we have the technologies, we’re using the technologies already that will help them get better... what gives me confidence is that... citizens... make judgments about the competence of their governments.” (46:37 & 47:12 – Harold James)

Timestamps for Key Segments

• Harold James’s Background / Interdisciplinarity: 02:44 – 07:17
• Crisis as Driver of Change: 09:23 – 12:11
• Why These 7 Crises, Not Others: 12:11 – 19:46
• Theory: Supply vs. Demand Shocks: 20:54 – 27:40
• Comparing 19th Century Famine & 1970s Oil Shock: 27:40 – 33:03
• Demand-Driven Crises (Great Depression/2008): 33:03 – 36:42
• The “Pseudo-Crisis” of the 1870s: 37:06 – 41:31
• Non-Crisis Periods & Backlash: 41:31 – 45:21
• Future of Globalization/Ooptimism: 45:21 – 48:08

Conclusion

Harold James’ conversation offers both sweeping historical perspective and theoretical innovation on the relationship between crisis and globalization. By distinguishing between types of shocks and how societies respond, James not only retells economic history but reframes current anxieties about deglobalization—suggesting future crises, while disruptive, may also seed new global cohesion and prosperity. The episode is rich in historical context, economic theory, and guarded optimism, making it essential listening (or reading) for anyone interested in the cyclical evolution of the global economy.