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Introduction to Globalization

• Parochialism means having a narrow mind and is something to avoid
• The world teaches us more about society; it opens our minds and understanding
• Filipinos increasingly interact with the world through gadgets, business, remittances, sending messages, and work
• 4,018 Filipinos per day worked abroad in 2009, and 6,092 in 2015
• Internet, cheaper travel, and multinational corporations (MNCs) are key factors

Globalization: An Interdisciplinary Study

• Integrates biological, physical, and mathematical sciences
• Allows examination of globalizing processes like banking, saving, financing, exchange, traders, and investors

Defining and Approaching Globalization

• Academic definition is based on the discipline itself
• Not confined to one
• Political scientists: "Challenge to the nation-state."
• Regional blocks gaining strength
• Global political norms emerging
• Economists focus on increased free trade and speed of trade
• Scholars of Culture and communication note the "global village"

Steger's Definition of Globalization

• Expansion and intensification of social relations and consciousness across world-time and world-space
• Connectivity is diverse (economic, political, cultural, etc.) and enabled by various factors, pressures, media
• Expansion and stretching of social relations involve NGOs, friendships, government associations, and MNCs
• Intensification and acceleration of social exchanges and activities include the transition from snail mail to Facebook and increased travel

Subjective Experiences of Globalization

• Awareness and association with global trends

Key Concepts of Globalization

• Creates, multiplies, stretches, and intensifies worldwide social interdependencies and exchange
• Makes people aware of connections between the local and the distant

Globalization's Nature and Impact

• Offers opportunities for truly worldwide development, but progress is uneven
• Not a recent phenomenon
• Manifests advances in modern technologies that have made international transactions more convenient and accessible

Market Forces and Globalization

• Some have been in operation for centuries at all levels of human economic activity, including village markets, urban industries, and financial centers
• The interplay of extraordinary technological innovation mixed with the influence of the world drives today's changing complexity

Core Claims of Market Globalism

• All about liberalization and global integration of markets
• Globalization is inevitable and irreversible due to market forces and technological innovations
• Inevitability implies nobody is in charge of globalization
• Supposed to benefit everyone
• Furthers the spread of democracy in the world

The Global Economy

• Long-distance trading flourished starting in the 11th century
• Significant contributor to the economy of the world
• There was the birth of capitalism

Characteristics of Capitalism

• Free enterprise
• The right to private property ownership
• Freedom of contract
• The right to find one's happiness
• Free come to live

Gary Gereffi's Perspective

• Global changes are attributed to how the global economy is organized and governed
• These changes impact the flow of goods and services across national borders

Global Economy: Levels of Analysis

• Analyzed at different levels: macro, meso, and micro

Macro Level

• Includes international organizations and regimes that establish rules and norms
• EX: World Bank, IMF, WTO.

Meso Level

• Building blocks are the countries and firms
• Global economy is the arena in which countries compete in different product markets

Micro Level

• Focuses on resistance to globalization by consumer groups, activists, and transnational social movements

Historical Perspectives on Trade

• Development of a world trading system created a tripartite structure of core, semi-peripheral, and peripheral economic areas
• Upward or downward mobility of nations is determined by a country's mode of incorporation in the capitalist world-economy

Market Integration

• Foreign trade connects markets or integrates them across countries
• Goods move from one market to another
• Choice of goods in the market rises
• Price disparity reduces

The Rise of the Global Corporation

• Inseparable from the phenomenon of globalization
• Corporations identified based on their roles
• Approach to the study of globalization is "historical globalization"
• Focuses on early patterns of trade and exchange

Functional and Organizational Differences

• Entities operating in the environment are not different from contemporary organizations
• They are possessed of "head offices, foreign branch plants, corporate hierarchies, extraterritorial business law, and even a bit of foreign direct investment and value-added activity."

Defining Global Corporations in the Contemporary Era

• Direct antecedents found within the dynamics of a two-plus-centuries long duration spanning the period prior to the end of WW II

Impact of Industrial Revolution and Colonialism

• Resulted in new ways to organize the world through colonialism and imperialism

Characteristics of "Global Corporations"

• Facilities and plants located worldwide
• Products and services can be shifted among countries
• Sourcing is on a global basis
• Supply chain is global
• Product design and process technology are global

The World After WWII

• Economic recovery and expansion led by American corporations
• Period until the re-entry of Japanese and European corporations onto the global scene
• Period from the end of WWII to the present is the third and distinct period in the transformation of the global corporation

Transformation of Global Corporations

• Occurred within the third period have been far-reaching and distinctive
• Reflected changes taking place within the broader structural dimensions of globalization itself

Global Corporations' Functions

• Referred to as multinational, transnational, international, or global companies
• International companies are importers and exporters, often without foreign investment
• Multinational firms invest abroad, adapting their offerings to local markets
• Transnational firms do not identify with one national home

Structures and Strategies of Global Companies

• Global companies invest and operate in many countries, marketing to local needs
• Transnational companies invest abroad and have a central corporate facility
• Decentralize decision-making, research, and marketing
• Engage in activities that add value in multiple countries

Historical Phases of Global Corporate Expansion

• 1960 major turning point for FDI, followed by subsequent tripling each decade (Hedley 1999)
• Economists "framed" growth of the global corporate structure through foreign direct investment

Foreign Direct Investment (FDI)

• When a company owns another in a different country.
• Unlike portfolio investment, signals direct involvement, knowledge, skills, and technology
• 1960 indicated as major turning point

Phases of Globalization Since 1800s

• The First Phase Of Globalization (1830-1880)
• Began about 1830
• Peaked around 1880
• Wide spread International commerce in this period due to the growth of railroads, efficient ocean transport, and the rise of large manufacturing and trading companies
• The inventions of the telegraph and telephone in the 1800
• Greatly aided early efforts to manage companies' supply chains

Second Phase Of Globalization (1900-1930)

• began around 1900
• Caused by the rise of electricity and steel production.
• Peaked before the Great Depression, a worldwide economic downturn

Third Phase Of Globalization (1948-1970s)

• At war's end in 1945, substantial pent-up demand existed for consumer products, as well as for input goods to rebuild Europe and Japan..
• U.S. was least harmed by the war and became the world's dominant economy.

Fourth Phase of Globalization (since the 1980s to present)

• began in the early 1980s and witnessed an enormous growth in cross-border trade and investment activity.
• The number of global corporations from emerging markets has increased significantly

Key BRICS Economies

• Brazil
• Russia
• India
• China
• South Africa
• Represent the most dynamic sector
• BRICS are economies suggesting a shift

The Global Interstate System

• Whole system of human interactions
• Structured politically as an interstate system
• Civilizations wealth
• A system of competing and allying states

Importance of International Law

• designed as an aid to the preservation of order among sovereign states
• its principles were explicitly stated as applying only to civilized states
• international law is a product of the special civilization of modern Europe and forms a highly artificial system
• the issue between a civilized Christendom and the noncivilized world

Categories of Humanity

• 3 Types of Humanty
• 1st civilized political
• 2nd barbaric political
• 3rd savage human

The Laws of War Objectives

• To minimize the severity of conflicts between civilized states
• Limited or absent reciprocity in uncivilized settings

Modern Perspectives on International Law

• Serves as framework for international relations
• National law becomes international law on tribunal delegation
• Treats may require national conformity

Contemporary Global Governance

• A broad concept defined in various ways
• Impossible to ignore globalization's impact on sovereign states
• Any state admitted to the UN must be peace-loving and able to carry out obligations
• Sovereignty: Foundation of Legal and Political Systems
• Sovereignty remains vital but faces challenges from intercontinental economics, global markets

Shifting Governance Dynamics

• Sovereign states face governance and deregulation challenges
• "Borderless" market relationships and political discontent

Transnational Actors in Global Governance

• Rising role of IGOs, INGOs, and TNCs in global affairs
• Transnational law emergence

Evolution of International Law

• Global governance evolves with international law
• International law: New focus on humans and legal regimes
• Power shift from state-centric to polycentric international legal system