Understanding Globalization's Impact
Understanding Globalization's Impact
Globalization
Introduction
Most regions were economically self-sufficient
o Local consumption of locally produced foods, fuel, and raw material
o Limited trade between different regions
Current: interconnected economies single, interdependent global economy
Most important factor currently shaping the world economy
o Traced back to 1800s
What is globalization?
Encompasses multitude of processes that involve the economy, political systems, and culture
Progress, development, integration
a) Positive phenomenon
b) Occurring through and with regression, colonialism, and destabilization
CHARACTERISTICS OF GLOBALIZATION
a) Connectivity
b) Borderless World
c) Cultural Diversity
d) Free Trade
e) Mobility
f) Information Technology
ORIGINS AND HISTORY OF GLOBALIZATION
i. Hardwired
o Nayan Chanda: globalization was made possible because of our basic human need to make our lives
better
o Started when ancestors in Africa started to walk away to find better food, shelter, etc.
ii. Cycles
o A long term cyclical process finding origin will be a daunting task
o Adherence to idea that other global ages have appeared
iii. Epoch
o Ritz (2015): cited Therborn’s (2000) six great epochs of globalization
o “waves” + own origin
o Epochs vs. Cycles – does not treat epochs as returning
1. Globalization of Religion
2. European colonial conquests
3. Intra-European wars
4. Heyday of European Imperialism
5. Post-World War II Period
6. Post-Cold War Period
iv. Events Cycles
o Specific events
o Notable changes as origin of globalization:
1. Emergence of United States as the global power (post World War I)
2. Emergence of multinational corporation (MNCs)
3. Demise of the Soviet Union and the end of the Cold War
METAPHORS OF GLOBALIZATION
A. Solid and Liquid
a. Solidity – barriers that prevent/ make difficult movement of things (natural/ man-made)
b. Liquidity – increasing ease of movement of people, things, information, and places in the world
B. Flows
o Ritzer (2015): movement of people, things, places, and information growing “porosity” of global
limitations
C. Heavy and Light
a. Heavy – difficult to move; heaviness = tend to stay put + what they produced can only be moved with
great effort and great expense
b. Light – goods and people that are easier to move because of advances in technology
“The perspective of the person who defines globalization shapes its definition. It’s a starting point that will guide the rest
of any discussions.”
The Global Economy
Introduction
EIGHT MILLENIUM DEVELOPMENT GOALS
1) Having a global partnership for development
2) Achieving universal primary education
3) Improving maternal health
4) Promoting gender equality and women empowerment
5) Combating diseases such as HIV/AIDS
6) Reducing child mortality
7) Ensuring environmental sustainability
POVERTY (eradication of extreme poverty and hunger)
o Condition characterized by severe deprivation of basic human needs (food, safe drinking water,
sanitation facilities, health, shelter, education, information)
o Absolute Poverty – less than $1.25/
o Philippines: Php 100, 563 (annual)
USA: USD 12, 140 (annual)
o 4 years ago: UN reported that 836 million people still live in extreme poverty
Actually down from 1.9 billion
World Bank: by 2030, it could drop to 400 million
Climate change is threat to improvements in global poverty
o Relation to Global Economy
Economic Globalization (Grates contribution) falling of extreme poverty
Interconnection of world’s economies + free trade growth of many developing countries
Economic Growth = gain further traction; 6.7 percent (2017) 6.9 percent (2018, 2019)
UN: “developing country” with low middle income
Theories of Stratification
1) Modernization Theory
2) Walt Rostow’s Stages of Modernization
3) Dependency Theory and the Latin American Experience
4) The Modern World-Systems
MODERNIZATION THEORY
Global stratification = function of technological and cultural differences between nations
Affluence could be attained by anyone
Historical events contributing to Western Europe:
i. Columbian Exchange
Spread of goods, tech, education, and diseases between Americas and Europe after
Christopher Columbus’ “Discovery of the Americas”
Europe: gained agricultural staples population growth
ii. Industrial Revolution
New technologies (steam power, mechanization) replace human labor with machines +
increase productivity
Western countries + improved living standards for everyone
STATIONARY = tension between tradition and technological change (barrier to growth)
Europe: Protestant Reformation progress-oriented way of life – financial success = sign of
personal virtue
WALT ROSTOW’S STAGES OF MODERNIZATION
1) Traditional Stage o Societies that are structures are structured around
small, local communities + production being done in family
settings + time spent on laboring strict social hierarchy
o E.g.: what your parents do is what you will do
2) Preconditions for Take-Off Stage o Use their individual talents produce things beyond
necessity
o Creates new market for trade
3) Take-Off Stage
o Greater individualism
Social status = material wealth
4) Technological Maturity Stage o Earlier technological growth bear fruit:
Population growth
Reduction in poverty levels
More diverse job opportunities
o Begin to push for social change + economic change
5) High Mass Consumption Stage o Production: wants > needs
o Social support systems = ensure all citizens have access
to basic necessities
DEPENDENCY THEORY AND THE LATIN AMERICAN EXPERIENCE
Product of Latin American experience
Cardoso and Felato (1979): Dependency – condition in which development of the nation-states of the South
contributed to a decline in their independence and to an increase in economic development of the countries
of the North.
Liberal trade greater impoverishment, not economic improvement, to less-developed countries
Why are there many countries in the world not developing?
o Not pursuing right economic policies
Authoritarian and corrupt government
o Dependency: how poor countries have been wronged by richer nations
o “In a world with finit resources, we cannot understand why rich nations are rich without realizing
that those riches came at the expense of another country being poor.”
a) Core Nations – more industrialized nations; received much of the world’s wealth
b) Semi-peripheral Nations – middle income nations; closer ties to the global economic core
c) Peripheral Nations – less developed; receive unequal distributions
TWO MAIN SUB-THEORIES
NORTH AMERICAN NEO-MARXIST APPROACH LATIN AMERICAN STRUCTURALIST APPROACH
o Andre Gunder Frank (1969) o Palma:
Development of less developed countries Latin America’s underdevelopment
follow path taken by developed excessive reliance of primary
countries commodities (object of fluctuating prices
Rejected idea that internal sources cause in short term + download trend in
a country’s underdevelopment relative value in the long haul)
Dependency to capitalist system = lack
of development
Cardoso & Faletto (1979): Dependency is not a general theory of underdevelopment, but rather a methodology
for the analysis of concrete situations of dependency
Dependecy = used to underscore extent to which the economic and whose center of gravity was located in
developed naitons
o Perpetuated by ensemble of ties among groups and classes both between nations (Linkage)
MODERN WORLD SYSTEMS
History of colonialism inspired Immanuel Wallerstein (American sociologist)
Periphery remains economically dependent on the core
o Poor nations tend to have a few resources to export to rich countries
Corporations: buy materials cheap process sell them at a higher price
o Profits bypass poor countries unequal trade patterns
Dependency Theory: not a lack of global wealth, but not distributed well
Increased trade between countries
o North American Free Trade Agreement – pits benefits of free trade against cost of jobs within a
country’s borders
o Learning globalization know issues and debate
MARKET INTEGRATION
Introduction
Economy – social institution that has one of the biggest societal impacts
o Composed of people
o Social institution that organizes all productions, consumptions, and trade goods in society
o Systems + revolutions how people live their lives
o Economic societies = vary from each society
More complicated/ sophisticated than how it used to be
SECTORS OF PRODUCTION IN SOCIETY
o Typically how production is split in an economy
i. Primary Sector
ii. Secondary Sector
iii. Tertiary Sector
Market Integration
Extent to which markets make goods available
Keep prices stable depends on whether markets are integrated with each other
Situation = separate markets for the same product becomes one single market
An indicator that explains how much different markets are related to each other
INTERNATIONAL FINANCIAL INSTITUTIONS
Globalization closer world economies
o Strength of more powerful economy greater effect on other countries
o Crises of weaker economy less effect on other countries
Effect on countries world economy gains and crises + organizations involved
1) The Bretton Woods System
2) The General Agreement on Tariffs and Trade (GATT)
The World Trade Organization (WTO)
3) The International Monetary Fund (IMF)
The World Bank
4) OECD, OPEC, and EU
5) North American Free Trade Agreement (NAFTA)
I. AGRICULTURAL REVOLUTION
o First big economic change
o Learned how to domesticate plants and animals much more productive than hunter-gatherer societies
o Farming helped societies build surplus (not everyone had to spend time producing food) major
developments
II. INDUSTIAL REVOLUTION
o Second major revolution in 1800’s
o Rise of industry new economic tools, popping out of factories change of work
o Work at home work as wage laborers skill specialization
Productivity went up
Better standards of living
Access to wider variety of goods (mass production)
o Economic Casualties:
a) Factory workers working in dangerous conditions for low wages
b) More productivity, greater wealth, but greater economic inequality
c) Late 19th century: formation of labor unions, sought out to improve wages and working
conditions
o CAPITALISM AND SOCIALISM
Two competing economic models that sprung
Economic capital became more important to the production of goods
A. Capitalism
System in which all natural resources and means of production are privately owned
Main drivers of efficiency: profit maximization + competition
Idea: eave capitalist economy alone = regulate things themselves (Adam Smith’s Invisible
Hands) – select best-value goods and services
Practice: economy does not work well on autopilot market failures (e.g., monopoly)
(reason why some countries are not purely capitalist)
B. Socialism
Government plays an even larger role
Means of production under collective ownership
Property owned by government and allocated to all citizens
Instead of the wealthy
Karl Marx: socialism is stepping stone to communism
III. INFORMATION REVOLUTION
o Current times
o Replacement of jobs by computers and technologies automation/ outsourcing jobs offshore
o Second half of 20th century: development of technologies
o Reduced use of human labor
Shifted from a manufacturing-based economy service work and production of ideas (rather than
goods)
Multinational Corporation
Increase in international trade = supported by international regulatory groups (e.g, WTO) and transnational trade
agreements (e.g., NAFTA)
International trade agreements often benefit private industries the most
o Companies can produce their goods and services across many different countries
A.k.a. Global Corporations
o Company that operates in its home country, as well as in other countries
o Maintains central office located in one country – coordinates management of other offices (e.g.,
administrative branches, factories)
Characteristics of an MNC
a) Very high assets and turnover
b) Network branches
c) Control
d) Continued growth
e) Sophisticated technology
f) Right Skills
g) Forceful marketing and advertising
h) Good quality of products
Reasons for being an MNC
1) Access to lower production costs
2) Proximity to larger international markets
3) Avoidance of tariffs
NON-GOVERNMENTAL ORGANIZATION
Organizations that are not tied to any country operate freely throughout the world
Provide emergency relief (e.g., food, water, medical supplies) for homes destroyed by disaster/ war
Neutral in wartime
1) International Federation of Red Cross and Red Crescent Societies – help wounded during war
2) Doctors without Borders – free emergency healthcare in disaster areas
3) Oxfam – famine and diseases
4) Amnesty International – speaks out about human rights and political prisoners
5) Save the Children Fund – help kids get healthcare and education
Global Governance
Introduction
Government
o Institution that creates warfare and sets economic policies for a country
o Political unit with authority over won affairs
o Group of people who control and make decisions for a country
o Particular system used for controlling a country
Today: globalization of politics ideas of nation-state, state sovereignty government control, and state policies
challenged from all sides
o Decrease of power of the state
o Actors becoming more powerful (MNC, global civil society that cross national boundaries)
History
WWII: creation of organizations and union maximize global governance + interference prevent unbalance
between states
o Decisions should be taken together and internationally = main characterization of global governance
Debate on Globalization emergence of theories on Global Governance
EMERGENCE OF GLOBAL GOVERNANCE
a) Declining power of nation-states
o States were “highly contingent and in flux open the possibility of emergence of some form of global
governance to fill void
b) Vast flows of all things run into/ right through borders of nation-states
o Involve flow of digital information of all things internet
c) Mass Migration of people and their entry (often illegally) into various nation-states
o Flow of criminal elements + products strong factor in call for global governance
d) Horrendous events within nation-states themselves either forment and carry out, or unable to control
e) Global problems that single nation-state cannot hope to tackle on their own
o E.g., global finance crises and panic that sweep world periodically (nations often unable to deal on their
own)
No world/ government that can coordinate and facilitate cooperation among all actors deal with these threats
and challenges
1980’s: way of showing how world was geographically split into relatively richer and poorer countries
a) Richer countries are almost all located in the Northern Hemisphere (except Australia and New Zealand)
b) Poorer countries are mostly located in tropical regions and in the Southern Hemisphere
Economically developed = became part of the “North” (regardless of geographic locations)
Unqualified = “South”
a) NORTH
o 1/4 of the world population
o Controls 4/5 of the income earned anywhere in the world
o Owns and houses 90% of the manufacturing industries
b) SOUTH
o 3/4 of the world population
o Access to 1/5 of the world income
o “Third World”; countries that belong to developing and less developed
o “Emerged in part to aid countries in southern hemisphere to work in collaboration on political, economic,
social, environmental, cultural, and technical issues”
o “interconnected histories of colonialism, neo-imperialism, and differential economic, and social change
through which large inequalities in living standards, life expectancy, and access to resources are
maintained”
NORTH SOUTH
a. Less population a. Large population
b. High wealth b. Low wealth
c. High standards of living c. Low standards of living
d. High industrial development d. Low industrial development
e. Industrial society e. Agricultural society
f. More developed regions f. Poverty, War, Tyranny
95% has enough food, shelter, and functioning Lack of well-developed domestic market
education system economies
Controls 4/5 of the income earned anywhere in Lack to evolve, of appropriate technology
the world No political stability
Stage of Development
CLASSIFICATION OF COUNTRIES
(According to the United Nations)
i. Least Economically Developed Countries (LEDCs)
Asian regionalism
Introduction
REGIONALISM
A political ideology focusing on the development of political/ social system based on one or more region
Regional organizations respond to states’ attempt to reduce the perceived negative effects of globalization
o Sort of counter-globalization
Benefits:
a) Generate productivity gains, new ideas, and competition
b) Diversify sources of economic demand
c) Provide leadership
d) Create regional mechanisms
Asian Regionalism
Product of economic interaction
Result of successful, outward-oriented growth strategies richer and closer Asian economies
a) WEST ASIA
o Between Central Asia and Africa and South of Eastern Europe
o Majority = Middle East; exclusion of Egypt (also a Middle-Easter country)
o 19 states:
Georgia Israel Bahrain
Armenia Palestine Qatar
Azerbaijan Jordan Saudi Arabia
Turkey Iraq United Arab Emirates
Cyprus Iran Oman
Syria Kuwait Yemen
Lebanon
Asia’;s Resources
Continent’s immensity + geologic diversity mineral wealth of Asia (reserves of important minerals)
o Coal, Petroleum, natural gas, uranium, iron, bauxite, other ores
o Exploited/ awaiting development
o Inaccessibility of some reserves = barrier to their exploitation
Industrialization primary means of economic development
o E.g., manufacturing consumer goods (electronics, footwear, clothing) as contractors for foreign firms
o Countries with dramatic growth (South Korea, Taiwan, Singapore) state support for domestically-
owned firms + invested heavily in education + moved from low-cost manufacturing to more advanced
economic activities (higher return)
Saudi Arabia + Persian Gulf states = growth exploitation of valuable petroleum and natural gas reserves
o Hard to develop economic sectors independent of oil production for future sustainable growth
Majority = agriculture (small peasant holdings)
o China, India: biggest employer; but diminishing share of gross domestic product
o Greatest poverty in rural areas
o Acceleration of urbanization (since mid-20th century) = increasing numbers of rural peasants leaving
Asian Organizations
Regional Organizations
o Different intergovernmental organizations help solve global issues + increase economic growth
1) Asia Cooperation Dialogue (ACD)
2) Asian Development Bank (ADB)
3) Asia Pacific Economic Cooperation (APEC)
4) East Asia Summit (EAS)
5) South Asian Association for Regional Cooperation (SAARC)
6) Association of Southeast Asian Nations (ASEAN)
Asian Cooperation Dialogue
Year founded: Current Secretary General:
June 18, 2002 Bundit Limschoon
General Function:
o An intergovernmental organization
o Promotes Asian cooperation (continental level)
Help integrate separate regional organizations (e.g., ASEAN, SAARC,
the Gulf Cooperation, Shanghai Cooperation Organization, Eurasian
Economic Union)
Member countries:
34 member countries
Religion
Religare (Latin): bind together, bond between God and man
John Cuber: “Religion is a culturally entrenched pattern of behavior composed of sacred beliefs, emotional
feelings accompanying beliefs, and overt conduct implementing beliefs and feelings.”
System of beliefs and practices shared by a group of people explain questions about life, afterlife, how to
live life (in relation to concepts of supernatural, transcendent, sacred)
o Basic (to all) = beliefs concerning nature of universe + man in relation
Globalization of Religion
INSECURITY, IDEOLOGY, AND THEOLOGY
19th century: insecurities (from French and Industrial Revolution) ideologies of nationalism & socialism
20th century: insecurities (from defeats of WWI) ideologies of Soviet Communism & German Socialism
Until 18th century in Europe & America/ 20th century for others: response to deep insecurity = theological
o Religious, instead of ideological
Modern Era: Enlightenment & Secularization made secular world-views & their ideologies seem natural and
logical (to interpret the happenings)