Globalization: Terminologies and Characteristics

Terminologies

• Solidity: A characteristic of being limited to one place.
• Fluidity: Refers to barriers that previously hindered the free movement of people, information, and objects.
• Discursive: Describes the global age where previously solid things have melted away and become adaptable.
• Globality: Refers to the condition or quality of being global or worldwide.

Description

• Globalization is the worldwide integration of economic, technological, and political aspects between countries (Hamilton, 2008).
• Globalization reshapes how we traditionally study the social world and human culture (Appelbaum and Robinson, 2005)
• Globalization includes the reorganization of production, penetration of industries across borders, and spread of financial markets (Mittelman, 2000).
• Globalization is characterized by flows of liquid phenomena like people, objects, and information.
• Globalization is the result of opening the global economy and increased trade among nations.
• Globalization is a historical process accelerated by the international spread of capitalism, rationalism, and industrial production.

Enumeration

• Heavy example includes the pre-industrial and industrial societies.
• Light represents the era marked by advances in technology and transportation.
• Weightlessness is a metaphor for the current state of globalization.
• Globalization is about the liberalization and global integration of markets.
• Globalization requires a global war on terror.
• Globalization is inevitable and irreversible.
• Nobody is in charge of globalization.
• Globalization benefits everyone in the long run.
• Globalization furthers the spread of democracy in the world.

Dimensions of Globalization

• Globalization in Culture: Refers to the transmission of ideas around the world, extending social relations.
• Globalization in Religion: Creates a single social unit, fostering religious pluralism and influencing politics and culture.
• Globalization in Economics: Involves the international movement of goods and services and economic integration.
• Globalization in Politics: Political activities transcend national borders through global movements and NGOs.
• Globalization in Technology: Driven by technological diffusion, spread of technology across borders, and rapid technology transfer.

Global Issues

• Population
• Poverty
• Energy
• Economic
• Environmental
• Food Production
• Military Issues

Additional Information

• Inequality remains despite greater liquidity, with developed countries benefiting more from globalization.
• Important international political organizations include the United Nations, World Bank, and International Monetary Fund.
• Globalization can lead to countries liberalizing import protocols and welcoming foreign investment.
• Politics occurs above the state via political integration patterns like the European Union.
• Globalization in culture involves common consumption of culture diffused by the internet and popular media.
• Globalization increases global awareness but also illicit cross-border activities.
• Global awareness in deprived areas can raise expectations and lower tolerance, potentially spreading democracy.
• In rich areas, the information revolution helps to forge a sense of global community.

Additional Notes about the Global Issues

• Food Production: Import of food supplies, especially influenced by bilateral trade, can assist to maintain supply
• Economic: Policies promote actions that lead to reductions in global inequality.
• Environmental: Development can lead to the depletion of natural resources, so sustainability should be considered.

Terminogies

• Decolonization: The process of dismantling remaining colonialist power even after political independence.
• Laissez-faire Ideology: Advocates for minimal government intervention in the economy for efficiency.
• Modernization Theory: Views the West as a map of global development.

Ennumeration

• Colonialism involves settlers and formal mechanisms of political control, using hard power.
• Imperialism describes methods to gain control and exercise control, typically setting up an empire, using soft power.
• Neo-Liberalism favors free trade and investment anywhere, encouraging international economic interdependence.

Additional Info

• Development of the northern part of the globe can be attributed to key factors, early start of human activity, spread and impact of capitalism, and the process of modernization.
• Globalization approaches include a process from the dawn of history, coterminous with capitalism and modernity, and a phenomenon associated with post-industrialization.

Terminologies

• Economic: A foundation that influences society and politics, affecting a country's ability to compete.
• Silk Road: An ancient Chinese international trade route.
• Depression: A post-war economic slowdown.
• Bretton Woods System (1944-1971): Aimed to create a stable international monetary framework.
• US Dollar: Adopted as a "global currency" under the Bretton Woods system.

Terminologies

• Richard Nixon stated that the Bretton Woods system collapsed due to excessive U.S. dollar production causing inflation

Additional Info

• The International Monetary Fund (IMF) aimed to create a stable global monetary system.
• During the Philippines' "Golden Era," the Bretton Woods system helped stabilize and foster economic growth.
• The U.S. held major gold reserves and a major share of global exports.

Terminologies

• Epoch = A significant period.
• Remittance = Money sent back to country of origin.
• Autarky = Nation-state becoming economically self-sufficient.
• July 1944 = Meeting for the establishment of Bretton Woods system.
• TRIPS = Trade-Related Aspects of Intellectual Property Rights, WTO agreement to protect creators.
• TRIMS = Trade-Related Investment Measures, WTO agreement on trade measures government can impose on foreign firms
• GATT = General Agreement on Trade and Tariffs; to facilitate the liberalization of trade
• WTO = World Trade Organization, Headquarters: Geneva, Switzerland
• IBRD = International Bank for Reconstruction and Development
• IMF = International Monetary Fund, Goal: macroeconomic stability
• TNC = Transnational Corporation, operates in multiple countries but decentralizes management
• MNC = Multinational Corporation, operates in multiple countries but maintains a central headquarters
• Portfolio Investment = An MNC activity that involves the purchase of equities in companies in other countries for financial gain, not control
• Greenfield Investment = An MNC activity that involves the building of totally new corporate facilities in another country
• Offshore = The transfer of activities to entities in other countries
• Outsourcing = The transfer of activities once performed by an entity to a business in exchange for money

Notes

• GATT is a forum for the meeting of countries, focuses on trade
• WTO is an independent organization that took responsibility for trade in services

Key elements in Bretton Woods

• The state should establish a "par value" for its currency expressed in gold
• The monetary authority should agree to exchange its own currency
• The IMF was created to establish and oversee exchange rates.
• The state agreed to eliminate all restrictions of currency use for international trade
• The entire system was based on the US dollar.

Economic chains in global trade

• Supply Chains = Label for value-adding activities in the production process
• International Production Networks = networks of producers involved in the process of producing a finishing product
• Global Commodity Chains = Idea of value-adding chains and the global organization of industries
• Global Value Chains = Overreaching label for all work of all chains

Ways which a corporation becomes trans an multinational

• Greenfield investment
• Merger and acquisition
• Strategic collaborations

Additional info

• The US pegged its currency at 35 dollars per ounce of gold, while in Nicaragua it was pegged at 175 cordobas per ounce of gold.
• The US had about 3/4 of the world's gold supply and also had about 1/5 of world exports.
• Bretton Woods had its most powerful effects on global trade (with idea of unconditional most-favored nation), global monetary order (envisioned for IMF), and global investment (envisioned for World Bank,
• The membership for the World Bank is open to member states of IMF and also includes the 184 nations. Among its missions are encouraging development of productive facilities in less-developed countries and encouraging international investment
• The Nine Dragons Paper is a paper manufacturing company in China founded in 1995 by Zhang Yin, with her business partner Chung Nam, Los Angeles-based America, with their manufacturing process involving taking of mountains of US waste paper, and were being recycled
• The Organization of Petroleum Exporting Countries (OPEC) was formed in 1960, consisting of countries that are major oil exporters, such as Irn, Iraq, Saudi Arabia, which was established to stabilize oil markets and ensure a regular supply of petroleum
• TNCs in the Philippines include companies like Unilever, Nestlé, Shell, McDonald's, and Procter & Gamble, which operate locally while following global strategies
• MNCs in the Philippines include Toyota, Coca-Cola, Samsung, Honda, and PepsiCo, where local operations are managed under the control of their foreign headquarters

Terminologies

• Macroeconomics: Study of households, individuals, and firms behavior concerning allocation of resources and decision-making.
• Transactions: Explains the functioning of a global economy.
• Contract Manufacturing: Permitting a local manufacturer in a foreign country to produce their products.
• Brandt Line: Invisible line across the world that divides the rich north from the poor south.
• Brandt Report: Written by the Independent Commission, chaired by Willy Brandt in 1980, to review international development issues.

Categories of Organization

• Intergovernmental Organizations are organizations composed of sovereign states (e.g. WTO, WHO).
• Transnational Corporations are businesses that operate in multiple countries.
• Supranational Organizations are organizations that promote economic, political, or cultural unity (e.g. UN).
• International Non-Governmental Organizations extend from the concept of NGOs to an international scope (e.g. Amnesty International).
• Multinational Corporations own and control production of goods or services in more than one country.

Characteristics Comprising the Global Economy

• International Trade facilitates exchange of goods and services between countries.
• International Finance allows for faster money transfer between countries.
• Global Investment happens via foreign direct investment.

Benefits of Global Economy

• Free Trade allows countries to specialize in the production of goods, allowing countries to specialize in products
• Increased Investment attracts countries due to the presence of global economy
• Increased Economies of Scale includes lower average cost and lower price for customers
• Movement of Labor helps increase migration, which helps solve high unemployment and reduce geographical inequality

Factors Affecting Global Economy

• Modern World System: Has boundaries, structures, and member groups, made up of conflicting forces.
• Actors in Globalization: Influential in the result of globalization, are categorized in organizations
• Global Economic Integration: Considered a trend in civilization that includes factors such as privatization, deregulation, trade liberalization, and regional integration.

Factors Affecting Global Economy Growth

• Privatization: Transfer of ownership or business from the government to the private sector.
• Deregulation: Process of removing state regulations, typically in the economic sphere.
• Foreign Direct Investment Investment in the form of controlling ownership in a business in one country by an entity based in another country.
• Regional Integration: Process by which 2 or more nation states agree to cooperate to achieve peace, stability, and wealth, usually involving one or more written agreements that describes the areas of cooperation in detail.
• Trade Liberalization: Removal of restrictions on the free exchange of goods between nations.

Market Intergration

• Integration provides an opportunity to expand market coverage, helps to reduce market and should be equal if they are well integrated.

Characteristics

• It is about an organization with global membership or influence
• Should play a crucial role in shaping international policies and facilitating cooperation among nations

Attributes Of Global System

• When countries or states are independent and govern themselves
• When countries interact with each other through diplomacy

Contemporary global governance

• Establish policies and ensure continuous monitoring of implementation by the members of the governing body

United nation

• Aims to ensure peaceful conditions and international coorperation

Reasons for creating the UN

• Ensure peace and security in the world following the Second World War
• Promote friendly relations among nations
• Encourage cooperation in solving global problems
• Uphold and respect human rights worldwide

Key organs of United Nations

• General Assembly
• Secretariat
• International Court of Justice
• Trusteeship Council
• Economic and Social Council
• Security Council

Acheivements of the united nations

• Promotions of democracy and peace in many countries
• Safety and health for developing countries
• Protects environment
• Ensure access to water

Terminologies

• Governance describes the establishment of policies and their implementation.
• North-South Divide is the economic and political division between wealthy ("North") and poorer ("South") countries.
• Global Divide refers to division by economic, political, and social characteristics.
• "Third World refers to countries with poverty & exploitation.
• Second World refers to socialist and former communist countries
• First World refers to most developed and Capitalistic countries

Global South and Global North Comparison

• Global North comprises 25% of the global population, richer, manufacturing industries
• The south is characterised by poverty and economic dependency.

Terminologies

• Governance = establishment of policies and continuous monitoring
• Global North = Wealthy countries
• First World = Developed Capitalistic countries
• Second World = Socialist and former communist countries
• Third World = Underdeveloped countries

Indicators Of Socio-Economic Development

• Social Relations
• Education & Work
• Safety
• Environment
• Health
• Economic Risk
• Material Living Conditions
• Participation and Trust

Socio-Economic Factors

• Wealth
• Occupation
• Where Someone Lives
• Income
• Education

Characteristics Of Developed Countries

• Better Living Standards
• Education
• Gross Domestic Product
• Human Development Index
• Industrialization
• Per Capita Income
• Political Freedom

Characteristics Of Developing Economies

• Low per capita income
• High population growth rate
• Dependence on primary sector
• Dependence on exports of primary commodities
• High rates of unemployment

Characteristics Of Less Developing Countries

• Rapid population growth
• Dependence on international trade
• Unskilled labor force
• Low literacy

Extra notes

• The Global South is not as economically sound or politically stable as Global North
• The three world theory made no longer sense when in 1989-1991

ASEAN

• a regional organization of Southeast Asian nations, serving as a key player in regional cooperation and development, while gaining influence in East Asian regionalism through partnerships with major powers
• Monoploy means one producer controls supply of a good or service
• Monoposrtation means one producer controls supply of a good or service
• Regional integration = the process by which two or more nation-states agree to co-operate

Extra notes

• In Asia, the Southeast Asian countries have already formed ASEAN
• Goal of regionalism became encapsulated in the concept of an East Asian community
• Globalisation has trade and market advancements