Globalization Overview

Globalization

• Globalization is a multifaceted concept encompassing economic, social, and cultural phenomena.
• It involves the expansion of economic and social ties between countries.
• Globalization is characterized by the spread of corporate institutions and the capitalist philosophy leading to a "shrinking world" economically.
• Sociologists Martin Albrow and Elizabeth King define globalization as processes that integrate the world's people into a single society.
• Scholte views globalization as processes where social relations take on borderless qualities, making the world feel like a single place.
• Giddens defines it as the intensification of worldwide social relations, linking distant areas so local events are influenced by global happenings.

Definition

• Globalization is an economic, social, and cultural phenomenon.
• It’s the movement towards expanding economic and social connections between countries through institutions and capitalist principles.
• This leads to a feeling of the world shrinking economically.

Integration of Economies

• Economies are becoming increasingly reliant on each other.
• Opportunities exist to buy and sell in any country globally.
• Labor and capital can locate anywhere globally.
• Global markets in finance are growing.

Integration of Economies (Made Possible By)

• Technology networks
• Communication networks
• Internet access
• Growth of economic cooperation (e.g., EU, NAFTA, etc.)
• Collapse of communism
• Movement towards free trade

Trade versus Aid

• Benefits of Trade:
  • Increased consumer choice
  • Greater potential for increased economic growth
  • Increased international economies of scale
  • More employment opportunities
• Disadvantages of Trade:
  • Increased gap between the rich and the poor
  • Dominance of global trade by wealthy, northern hemisphere countries
  • Lack of opportunities for the poor to access markets
  • Exploitation of workers and growers

Corporate Expansion

• Multinational corporations (MNCs/TNCs): Businesses with headquarters in one country and operations in multiple others.
• Characteristics of MNCs/TNCs:
  • Expanding revenue
  • Lowering costs
  • Sourcing raw materials
  • Controlling key supplies
  • Control of processing
  • Leveraging economies of scale

Corporate Domination

• Key Issues:
  • Damage to the environment
  • Exploitation of labor
  • Monopoly power
  • Economic degradation
  • Use of non-renewable resources
  • Damage to cultures

Other Issues

• Accountability of Global Businesses
• Increased Gap between Rich and Poor: This fuels potential terrorist reactions.
• Ethical Responsibility of Businesses
• Efforts to Remove Trade Barriers

Features of Globalization

• Globalization's characteristics: Increased flow of trade, capital, and information; increased mobility of individuals.
• Integration of national economies: Countries increasingly integrate their economies into a global network.
• Information and technology revolution: Fast communication allows for rapid movement of goods, capital, information, and people worldwide.
• Opening up national economies: Foreign capital, investment, and technologies enter domestic markets.
• Free trade: Removal of trade barriers and tariffs (e.g., most favored nation status).
• Global Governance: Super-state agencies (e.g., UN, IMF, WTO) manage global issues.

Effect of Globalization

• Connecting cultures: Globalization affects international relations economically, politically, and socially, impacting understanding and shaping relationships between societies.
• Changes in international relations: Globalization enhances connections, shifts the global system to collaborative models.
• Contribution to local economies: Multinational companies create economic activity in the local economies by spending money for goods and services.
• Cultural exchange: International exchange facilitates broader cultural diversity.

Globalization and Sovereignty of the state

• Impact on international relations: Globalization affects how countries interact and manage their affairs, increasing cooperation opportunities but also challenging traditional ideas about national control.
• Cooperation on global issues: Concerns, like climate change, trade, and health require international cooperation, potentially limiting single-country decision-making.
• Economic competition: Globalization increases global economic competition, impacting local industries and job markets.