Understanding Globalization

• Globalization is a broad topic and cannot be limited to a single definition or discipline.

Origin

• Globalization comes from the root word Global.
• Meydan Larousse (Turkish encyclopedia) defines "global" as "undertaken entirely."
• In French, it means "homogeneity," indicating uniformity or similarity.
• Most countries worldwide are experiencing and undergoing globalization.

Summarized Definition

• Globalization connects people across large distances in diverse ways. e.g. Sushi, Kdrama, and Songs
• It is an interaction among people, primarily an economic process of integration, with social and cultural aspects.
• It is equal to deteritorialization, which is a process where physical spaces lose their hold on social relations.
• Also includes the dissemination of information and knowledge.

Aspects/Areas Linked to Globalization

• Culture includes traditions, customs, and cuisines.
• The economy includes activities outside a country's borders that directly affect its economy, such as concerts/fan meetings, international shipping, and the establishment of international brands or stores.
• Politics includes bilateral/multilateral relations between countries/states.
• Also includes international organizations like Non-Governmental Organizations (NGO), Intergovernmental Organizations (IGO), and Multinational corporations (MNC).
• The environment is a platform for discussing several environmental issues through media and includes multiple advocacies and projects by organizations and nations.
• Socialization includes communication and interaction of people in different countries.
• Religion encompasses the spread of religion and teachings, inter-border movement, spread, and conversion of religion through early interactions or colonization.
• Ideology includes ideologies in International Relations such as Realism, Liberalism, Marxism and Constructivism.
• Technology refers to several innovations and modernization, such as computers, gadgets, and websites.
• Media includes digital media, print media, and social media
• Globalization is the inter-border movement of products, services, capital, technology, ideas, information, culture, and nation.

3 Concepts of Globalization

• Transference involves intensified exchange of things between pre-constituted units and across existing unit boundaries for economic, political, or cultural purposes.
• Transference is an inside-out process.
• Transformation refers to the process of transformation that occurs at the systems level and affects that system as much as it affects the identity of the units.
• Transformation is an outside-in process which alter their identity.
• Transcendence refers to meaning beyond ordinary limitations.
• Globalization is neither inside nor outside, but dissolves the distinction.
• States die and total emancipation finds the door open.
• Organizations diminish the limit or boundaries of each member nation and offer cooperation and bond between nations and move as one

History/Emergence of Globalization

Early History

• Early records of trade existed between the civilization of Sumeria and Indus Valley.
• The Silk Road was an ancient trade route that linked the Western world with the Middle East and Asia.
• Disease also traveled the Silk Road and caused the Black Death in the mid-14th century.

Medieval

• Age of Discovery/Expedition
• Christopher Columbus and Vasco De Gama
• Colonization by European countries like Spain and Philippines

Pre-modern (Industrial Revolution)

• Industrialization brought about the growth of machine production and factories.
• Changes in economic and social activities began in the 18th century with the replacement of hand tools by machinery and mass production.
• The need for income motivated men to leave their families behind for jobs.
• Women also worked outside the home, often worked as domestic servants or in the textile mills during the first century of industrialization.
• Child labor was rampant in the textile industry during the first century of industrialization.
• These women and children were paid very little and routinely compelled to work 16 hours per day or longer.

Modern

• Great development in commerce, abolishment of tariffs and taxes, creation of global corporations, and culture and traditions.
• Innovation, technology and rise of media is apparent

Misconceptions (Explained by Eriksen, 2014)

• Started during the 1980s or early 2000s.
• Economic Imperialism/Westernization.
• Homogenization
• Against Human Rights.
• Pose threats to local identities

Economic Globalization and Market Integration

• Economic globalization increases the integration of economies around the world through the movement of goods, services, and capital.

Major Players in Economic Globalization

• TNC and MNC are the main driving forces of economic globalization of the last 100 years.

Transnational Corporations (TNC)

• They do not have a centralized management.
• They do not have subsidiaries.

Multinational Corporations (MNC)

• They have centralized management which enforces all the policies and rules.
• They have subsidiaries.
• Both TNC and MNC operate in 2 or more countries with a wide range of activities.
• Both have established strong international networks.
• Both are powerful drivers of economic growth.

International Monetary System

• Refers to the system and rules that govern the use and exchange of money around the world and between countries.
• Each country has its own currency as money, and the international monetary system governs the rules for valuing and exchanging these currencies.

Gold Standard

• An international monetary system where a country's currency has a value directly linked to Gold.
• Countries must make several adjustments to maintain their exchange rates.
• It functioned reasonably well because it was backed by British Hegemony and other major powers.
• The primary objective is to promote monetary openness and stability.
• It broke down during World War 1 when most nations suspended the convertibility of their cash to gold.

Bretton Woods System

• An international monetary system where a country's currency was pegged to the US Dollar's value
• The only convertible currency to Gold was the US Dollar.
• The agreement stemmed from Bretton Woods Agreement which was negotiated in July 1944 by the delegates coming from 44 countries

World Bank

• The World Bank Group is one of the world's largest sources of funding and knowledge for developing countries.
• Its five institutions share a commitment to reducing poverty, increasing shared prosperity, and promoting sustainable development.
• The World Bank Group is a unique global partnership: five institutions working for sustainable solutions that reduce poverty and build shared prosperity in developing countries.

Five Institutions:

• The International Bank for Reconstruction and Development (IBRD)

• The International Development Association (IDA)

• The International Finance Corporation (IFC)

• The Multilateral Investment Guarantee Agency (MIGA)

• The International Centre for Settlement of Investment Disputes (ICSID)

• IDA focuses on the world's poorest countries

• IBRD assists middle-income and creditworthy poorer countries.

• IFC, MIGA, and ICSID focus on strengthening the private sector in developing countries.

International Monetary Fund (IMF)

• Works to achieve sustainable growth and prosperity for all of its 190 member countries.
• Does so by supporting economic policies that promote financial stability and monetary cooperation, which are essential to increase productivity, job creation, and economic well-being.