Globalization and the Global Economy

• The notes cover globalism, globalization, market globalization, challenges to globalization, and the emergence of contemporary global corporations.

Globalism vs. Globalization

• Globalism suggests events in one country are inseparable from those in another, necessitating internationally planned economic and foreign policies.
• Globalization is how economies develop to operate as one system, with goods, services, and socio-cultural influences becoming similar worldwide.

Global Economy

• The global economy involves trade of goods and services incorporated into a single global market.
• It operates as a virtual borderless world where individuals and companies collaborate globally for research, development, and sales.

Market Globalization

• According to Manfred Steger (2014), market globalization includes ideological dimensions with norms, claims, beliefs, and narratives.
• It has become the dominant ideology.
• Understanding globalization is vital to understanding the fundamental changes affecting the ideological landscape of the 21st century, including political ideologies and their "social imaginary".
• Ideologies become political when they claim, select, privilege, and constrict social meanings regarding the exercise of power.

The 5 Core Claims of Market Globalism

• George David's Claim: Globalization is beneficial.
• Barriers between nations are down, economic liberalism is demonstrably effective, trade and investment are booming, income disparities between nations are narrowing, and wealth generation globally is at a record high.
• He views globalization positively for the world's citizens.
• Steger's 5 Core Claims (2009):
  • Globalization involves liberalization and global market integration.
  • It is inevitable and irreversible.
  • Nobody is in charge of globalization.
  • Globalization, in the long run, benefits everyone.
  • It furthers democracy worldwide.

1st Claim: Liberalization and Global Integration of Markets

• Free trade and free enterprise become more important.
• Large enterprises and companies become less influenced by the government.
• Efficiency increases with fewer rules, free trade, and competition.
• Globalization leads to a free market in virtually every country.

2nd Claim: Inevitable and Irreversible

• Globalization is an absolute certainty with no turning back.
• Technological and scientific advances addressing both simple and complex concerns are entwined with daily life.
• Governments, political parties, and social movements must adapt.
• Their task involves facilitating the integration of national economies in the new global market.

3rd Claim: Nobody is in Charge

• Based on the classical concept of a self-regulating market.
• Technically, globalists do not dictate the process.
• According to Friedman, the global marketplace is an "Electronic Herd" of anonymous stock, bond, and currency traders and multi-national investors.
• Corporate social responsibility enters here.

4th Claim: Benefits Everyone in the Long Run

• Innovations from globalization eventually reach many regions.
• Globalization could bring economic growth and progress to developing nations.
• Developing nations may face greater risks of exploitation in trade and commerce.

5th Claim: Furthers Democracy

• Globalization and market is linked to democracy.
• This connection is significant in liberalism, conservatism, and socialism.
• Globalists view freedom, free market, and democracy as interconnected.

Challenges to Globalization

• The September 11 attacks (9/11) threatened globalization.
• A "war on terror" is used to market globalization's discursive arsenal.
• Globalization is sometimes viewed as the Americanization or McDonaldization of the world.

Emergence of Contemporary Global Corporations

• These are commonly referred to as international companies, multinational corporations (MNCs), global companies, and transnational corporations (TNCs).

International Companies

• International Companies operate solely within their home countries.
• They focus on importing and exporting, without investing outside their home country.
• Example: Universal Robina.

Multinational Corporations (MNC)

• Multinational Corporations have headquarters in their home country, but operate in one or more foreign countries.
• Product offerings are virtually the same throughout.
• Example: Jollibee.

Global Corporations

• Global Corporations have investments and presence in many countries.
• Their strategies may vary, offer same products for efficiency.
• Example: Apple.

Transnational Corporations (TNC)

• Transnational Corporations are complex organizations invested in foreign operations.
• Have central corporate facilities but give decision-making, research and development, and marketing powers to each foreign market.
• Example: McDonalds.