Globalization Review PDF

**GLOBALIZATION** - Refers to the process by which by which more people across large distances become connected in more different ways - Ang mabilis at patuloy na interborder ng paggalaw ng mga produkto, serbisyo, kapital, teknolohiya, ideya, impormasyon, kultura, at nasyon - It...

**GLOBALIZATION** - Refers to the process by which by which more people across large distances become connected in more different ways - Ang mabilis at patuloy na interborder ng paggalaw ng mga produkto, serbisyo, kapital, teknolohiya, ideya, impormasyon, kultura, at nasyon - Ito ay nakaugat sa bawat isa (Nayan, Chanda 2007) **TIMELINE OF GLOBALIZATION** 1. **ANCIENT (3000 BCE - 500 CE)** The roots of globalization can be traced back to the ancient world, where trade, cultural exchanges, and early communication networks laid the foundation for global connections. - **Trade Networks**: - **The Silk Road** (c. 2nd century BCE): Connecting China to Central Asia, India, and the Mediterranean, the Silk Road facilitated the trade of silk, spices, tea, and other luxury goods, while also allowing for the exchange of ideas, art, and technologies. - **Indian Ocean Trade Network** (c. 3rd century BCE -- 15th century CE): A crucial maritime trade route that connected Southeast Asia, the Indian subcontinent, the Arabian Peninsula, and East Africa, fostering the exchange of goods like spices, textiles, and ivory, as well as the spread of religions like Islam and Buddhism. - **Trans-Saharan Trade Routes** (c. 7th century BCE onwards): Trade across the Sahara Desert linked sub-Saharan Africa with the Mediterranean world. Gold, salt, and slaves were significant commodities traded, and Islam spread along these routes. - **Cultural and Religious Spread**: - **Spread of Religions**: Major world religions such as Buddhism, Hinduism, and Judaism spread through ancient trade networks. Buddhism, for example, moved from India to China, Korea, and Japan. - **Greek and Persian Influence**: Following the conquests of Alexander the Great, Greek culture spread throughout Asia, blending with local traditions (Hellenistic culture). Similarly, Persian influence permeated much of the ancient world. - **Technological Exchange**: - **The Invention of Paper**: Paper originated in China and spread westward along trade routes, eventually reaching the Islamic world and later Europe. - **Ironworking and Agriculture**: Innovations like iron tools, plows, and agricultural practices spread across different civilizations, improving farming efficiency. **2. Medieval Period (500 CE -- 1500 CE)** The medieval period witnessed the continued expansion of trade networks, the rise of empires, and cultural exchanges across vast distances. - **Expansion of Trade and Empire**: - **The Byzantine Empire and Mediterranean Trade**: The Byzantine Empire played a key role in preserving classical knowledge and facilitating trade between Europe, Asia, and Africa. Byzantine merchants traded in luxury goods like silks and spices, which flowed into Europe and the Islamic world. - **The Mongol Empire** (1206--1368): The Mongols created the largest contiguous empire in history, linking Europe, Asia, and the Middle East. Under Genghis Khan and Kublai Khan, the empire promoted trade and communication across Eurasia. The Pax Mongolica (Mongol Peace) allowed merchants to travel safely, and the Silk Road flourished. - **Religious Spread**: - **Islamic Golden Age** (8th--13th centuries): Islamic civilization became a major hub of knowledge, science, and culture. Scholars in cities like Baghdad translated Greek, Persian, and Indian texts, which would later influence European intellectual life during the Renaissance. - **Christianity**: Christianity spread throughout Europe, particularly in Northern and Eastern Europe through missionary work and the efforts of kings like Charlemagne and Vladimir the Great. - **Crusades**: The Crusades (1096--1291) were not only military campaigns but also occasions for significant cultural exchange. Crusaders came into contact with Islamic science, mathematics, and art, while the trade routes between Europe and the Middle East brought luxury goods to Europe. - **Technological and Scientific Advancements**: - **The Compass**: The Chinese invention of the compass spread to Europe and became essential for maritime navigation, boosting trade and exploration. - **Gunpowder**: Gunpowder technology from China spread to the Islamic world and Europe, fundamentally changing warfare. - **Social and Economic Change**: - **Feudal System**: In Europe, the feudal system dominated, but increased trade and the rise of merchant guilds gradually led to urbanization and the growth of early capitalist economies. - **Black Death** (1347--1351): The plague spread from Asia to Europe along trade routes, killing millions. This event reshaped the social and economic fabric of Europe, contributing to the eventual decline of feudalism. **3. Renaissance (14th -- 17th Century)** The Renaissance marked the rebirth of art, science, and exploration, with increased globalization driven by the expansion of trade routes and new technologies. - **Age of Exploration**: - **European Exploration**: European nations, particularly Spain, Portugal, and later England and France, began global explorations that connected Europe with Africa, the Americas, and Asia. Key voyages, such as **Christopher Columbus's discovery of the Americas** (1492) and Vasco da Gama's sea route to India (1498), opened new trade routes and created lasting links between previously isolated continents. - **Colonization**: European powers began colonizing the Americas, Africa, and parts of Asia, establishing vast empires and global trade networks for resources like gold, sugar, tobacco, and slaves. - **Technological Innovations**: - **Printing Press** (c. 1440): Johannes Gutenberg\'s invention revolutionized the spread of information. The printing press facilitated the distribution of books, pamphlets, and scientific ideas, contributing to the spread of knowledge and the Protestant Reformation. - **Cartography**: Improved maps and navigational tools helped expand European exploration and trade, while also enabling the establishment of global empires. - **Cultural Exchange**: - **Renaissance Humanism**: The Renaissance was marked by a renewed interest in classical antiquity, leading to the flourishing of art, science, and literature. The exchange of ideas between Europe, the Islamic world, and China enriched European culture and thought. - **Scientific Revolution**: Ideas from the Islamic world, ancient Greece, and other regions helped fuel the European Scientific Revolution, with thinkers like Copernicus, Galileo, and Kepler transforming our understanding of the universe. - **Global Economic Changes**: - **Mercantilism**: European nations adopted mercantilist policies, which promoted the accumulation of wealth through trade. This system supported the growth of the Atlantic slave trade and the exploitation of colonies for raw materials. **4. Modern Era (18th Century -- Present)** The modern period saw unprecedented acceleration in the process of globalization, driven by industrialization, technological innovations, and the expansion of global empires. - **Industrial Revolution** (18th -- 19th Century): - **Technological Advancements**: The Industrial Revolution, beginning in Britain in the late 18th century, revolutionized manufacturing, transportation, and communication. Innovations like the steam engine, railroads, and the telegraph connected distant parts of the world. - **Global Trade Networks**: The rise of industrial economies in Europe and the United States led to global trade, with raw materials being extracted from colonies and manufactured goods being sent to new markets worldwide. - **Global Empires**: - **Colonialism**: European powers expanded their colonial empires, controlling large parts of Africa, Asia, and the Americas. This period of imperialism created a global economic system where colonies supplied raw materials for European industries. - **Atlantic Slave Trade**: The forced transportation of millions of Africans to the Americas was integral to the global economy, fueling the labor-intensive agricultural systems of the Americas and enriching European merchants. - **Global Communication**: - **Telegraph and Telephone**: The invention of the telegraph (1837) and the telephone (1876) allowed for near-instantaneous communication across vast distances, further shrinking the world. - **Steamships and Railroads**: Steam-powered transportation revolutionized the movement of goods and people, making long-distance trade more efficient and opening up new frontiers for exploration and settlement. - **Modern Global Economy**: - **Global Trade Organizations**: In the 20th century, institutions like the **World Trade Organization (WTO)**, the **International Monetary Fund (IMF)**, and the **World Bank** were established to facilitate international trade, finance, and economic cooperation. - **Technological Revolution**: The digital age, marked by the rise of the internet, mobile technology, and global supply chains, has led to the rapid movement of information, people, and goods across the world. This has created an era of hyper-globalization, where economies, cultures, and societies are deeply interconnected. - **Global Challenges**: The modern era has also seen global challenges such as climate change, pandemics (e.g., COVID-19), and the rise of global movements for human rights and environmental sustainability. **CONCEPTS OF GLOBALIZATION** **TRANSFERENCE** - Pagpapalitan o pagexchange ng mga bagay sa pagitan ng dalawang establish units - refer to the transfer of ideas, practices, values, or cultural elements across different regions, societies, and contexts during the process of globalization - describe the movement or sharing of social, cultural, economic, or political ideas from one society or culture to another - Cultural Exchange: As people from different cultures interact through trade, travel, or technology, cultural elements such as food, language, music, fashion, and values can be transferred across borders. This cultural transfer can lead to hybridity (the blending of different cultural elements) or cultural appropriation (where elements of one culture are adopted by another, sometimes without proper acknowledgment or respect). - **Examples:** The widespread popularity of American fast-food chains, the global dissemination of Bollywood films, the influence of K-pop, and the spread of Japanese anime are all examples of cultural transference in globalization. **Economic and Technological Transference:** - **Examples:** The spread of Silicon Valley's tech model to places like China or India, or the adoption of Western-style capitalism in post-Soviet Eastern Europe, are instances of economic and technological transference in the global context. **Social and Environmental Transference:** - **Social Movements**: Ideas and movements, such as **civil rights**, **feminism**, **LGBTQ+ rights**, or environmental activism, have spread across borders due to globalization. The transference of social ideas has often led to changes in societal norms, values, and policies in different regions. - **Environmental Impact**: The transfer of industrial practices and the global spread of consumerism have also led to widespread environmental challenges like climate change and resource depletion. These issues require global cooperation and have led to the transfer of **environmental policies** and sustainability practices across countries. - **Examples**: The global rise of environmental movements or human rights campaigns, such as the **\#MeToo** movement or global calls for climate action (e.g., **Fridays for Future**). **Globalization of Religion and Beliefs:** - **Religious Transference**: Religious beliefs and practices are transferred across borders due to migration, trade, colonialism, and modern communication. This can result in religious ideas spreading to new areas or being combined with local practices to create new belief systems. - **Examples**: The spread of **Islam** across Africa and Asia, the spread of **Christianity** through European colonization, or the growing interest in **Buddhism** in Western countries. **TRANSFORMATION** - Ito ay nagbabago sa buong sistema. Naapektuhan ang Kalayaan ng isang bans ana umaksyon para sa sarili niya. - refers to the profound and often irreversible changes that occur because of the increasing interconnectedness of the world's economies, cultures, societies, and political systems. - These changes can be seen in a wide variety of sectors, including economics, technology, culture, politics, environment, and social structures. - Transformation in globalization often involves shifts in how people live, work, interact, and understand the world around them. - **Global Markets**: Globalization has transformed economies by creating interconnected markets. This has led to the rise of **global capitalism**, where economic activities, from production to consumption, span across borders. This means that economies are no longer isolated, and their success or failure can be influenced by global trends. - Example: **Supply chains** for goods like electronics, automobiles, and apparel are often multinational, with production processes spread across different countries. For instance, an iPhone might be designed in the U.S., manufactured in China, and sold worldwide. - **Trade Liberalization**: International trade agreements, such as the **World Trade Organization (WTO)**, have transformed how countries trade by reducing barriers like tariffs and quotas. This has encouraged the expansion of **free trade** and has led to the rise of international corporations and a global consumer market. - Example: The **North American Free Trade Agreement (NAFTA)**, now the **United States-Mexico-Canada Agreement (USMCA)**, is an example of how trade agreements have reshaped North American economies. - **Global Financial Systems**: The rise of global finance has transformed banking, investment, and capital flows. **Global financial markets**, including stock exchanges and investment funds, operate 24/7 and are interconnected, meaning economic crises in one part of the world can affect global economies. - Example: The **2008 Global Financial Crisis** demonstrated how financial markets in the U.S. could trigger economic recessions across the world. - **Information Technology and the Internet**: The rapid spread of **information technology**, especially the internet, has transformed how people communicate, access information, and conduct business. The internet has facilitated instantaneous communication and the global sharing of knowledge, fostering innovation and creating new economic and social opportunities. - Example: Social media platforms like **Facebook**, **Twitter**, and **Instagram** have revolutionized how individuals and businesses connect, while e-commerce platforms like **Amazon** have transformed retail industries globally. - **Digitalization of Work**: With the rise of **remote work**, **automation**, and **artificial intelligence (AI)**, the workplace itself has been transformed. Globalization has allowed businesses to outsource jobs and services to different parts of the world, resulting in both job creation and job displacement in various industries. - Example: Companies in developed countries often outsource customer service, software development, and even manufacturing to countries like India, China, or the Philippines. - **Cultural Exchange and Hybridization**: Globalization has facilitated the exchange of cultural elements across borders, leading to the blending or hybridization of cultures. This transformation is evident in how global influences shape music, fashion, cuisine, and entertainment worldwide. - Example: **Hollywood** films dominate global box offices, while **K-pop** (Korean pop music) has become a global cultural phenomenon. - **Cultural Homogenization vs. Localization**: While globalization has led to greater cultural convergence, some argue it also causes the **erosion of local cultures** (cultural homogenization). However, in response, there is often **localization**, where global influences are adapted to local tastes and customs. - Example: **McDonald's** serves localized menu items around the world, such as the **McAloo Tikki** in India or the **Teriyaki Burger** in Japan. - **Rise of International Institutions**: Globalization has transformed the political landscape by promoting the establishment of international organizations that govern and regulate cross-border issues. Institutions like the **United Nations (UN)**, **World Health Organization (WHO)**, and **International Criminal Court (ICC)** shape how countries cooperate and resolve conflicts. - Example: The **Paris Agreement** on climate change represents a global political effort to address environmental challenges that no single country can solve alone. - **Geopolitical Shifts**: The power dynamics between nations have shifted due to globalization. Countries like **China** and **India** have risen economically and politically to challenge the traditional dominance of Western powers like the U.S. and the European Union. - Example: China\'s Belt and Road Initiative (BRI) is transforming global trade routes and infrastructure development, asserting China's influence on the global stage. - **Migration and Demographics**: Globalization has led to increased migration, whether due to economic opportunities, conflicts, or climate change. This has transformed the demographics of many countries, creating multicultural societies but also presenting challenges in terms of integration and social cohesion. - Example: The migrant crisis in Europe, especially during the **Syrian Civil War**, has transformed the social fabric of countries like Germany, France, and Italy. - **Social Movements and Global Activism**: Globalization has enabled the rapid spread of social movements, such as those advocating for **human rights**, **gender equality**, **racial justice**, and **environmental sustainability**. Activists now can mobilize and connect across borders more easily. - Example: The **\#MeToo movement**, originally sparked in the U.S., became a global phenomenon, highlighting issues of sexual harassment and gender inequality worldwide. - **Global Environmental Challenges**: The interconnectedness brought about by globalization has highlighted environmental issues that transcend national borders, such as **climate change**, **pollution**, and **biodiversity loss**. The global nature of these issues requires coordinated international responses. - Example: **Global warming** is a result of carbon emissions from industries and transportation around the world, leading to more extreme weather events and rising sea levels. - **Sustainable Development**: Globalization has also led to the **spread of sustainable development goals (SDGs)**, where countries are encouraged to work together to address global environmental issues, such as clean energy, poverty reduction, and sustainable agriculture. - Example: The United Nations' **Sustainable Development Goals** are an effort to guide global action towards achieving a more sustainable and equitable future. - Implies exchange across existing unit boundaries and between units and system, but it still exist and presupposes that this system as well as the units remain identical with them selves throughout the globalizing process. - refers to the idea of moving beyond traditional boundaries---such as national, cultural, or economic limits---into new, broader global connections and ways of thinking. It encompasses the ability of globalization to create new frameworks of understanding, identity, and relationships that surpass local or national contexts 1. **Breaking National Boundaries:** - **Political and Economic Transcendence**: Globalization transcends the traditional boundaries of nation-states, allowing for the creation of international agreements, transnational organizations, and global markets. This shift has blurred the lines between countries, making international cooperation more essential. - Example: The rise of **international institutions** like the **World Trade Organization (WTO)**, the **United Nations (UN)**, or the **European Union (EU)** demonstrates a transcendence of national borders in order to address issues like trade, security, and human rights. 2. **Cultural Transcendence:** - **Cultural Fusion and Global Identity**: Transcendence in globalization also refers to the blending of cultural elements across the world, creating a **global culture** or a **global identity**. This transcending of cultural boundaries allows people from different cultures to share ideas, experiences, and practices, which can lead to a more interconnected world. - Example: The worldwide influence of media, such as **Hollywood films**, **K-pop** music, or **Bollywood**, shows how cultural products transcend national identities to become part of a shared global experience. 3. **Transcendence of Economic Models:** - **Global Economic Systems**: Globalization transcends traditional economic models rooted in national self-sufficiency. It promotes an interconnected global economy, where production, trade, and finance are spread across multiple countries. This interconnectedness has transformed how industries operate, leading to the rise of **global supply chains** and **multinational corporations**. - Example: The success of companies like **Apple** or **Amazon**, which operate on a global scale, transcends national boundaries, creating markets that are not confined to any one country but are instead part of a global economic system. 4. **Technological Transcendence:** - **The Spread of Technology**: The rapid spread of technology, particularly digital technologies, has transcended geographical and national barriers. The **internet**, **smartphones**, and **social media** have made it possible for people around the world to connect instantly, share knowledge, and access information without regard to physical or political boundaries. - Example: The rise of the **internet** and **social media platforms** like **Facebook**, **Twitter**, or **Instagram** transcends borders by enabling global communication, collaboration, and knowledge-sharing. 5. **Transcendence in Social Movements:** - **Global Activism and Solidarity**: Social movements today are increasingly global in nature, as issues like **climate change**, **human rights**, **gender equality**, and **racial justice** transcend national borders. People around the world are joining forces to tackle common challenges, building a sense of global solidarity that moves beyond local or national concerns. - Example: The **global \#MeToo movement** transcended cultural and national boundaries, highlighting issues of sexual harassment and gender inequality worldwide. 6. **Philosophical and Spiritual Transcendence:** - **Global Consciousness**: Transcendence in the philosophical and spiritual sense refers to the idea of overcoming limited, local, or personal perspectives to adopt a **universal human perspective**. As global challenges such as **climate change**, **pandemics**, and **conflict** require collective action, people are increasingly viewing the world and humanity as interconnected, promoting shared solutions for global problems. - Example: The rise of **global environmental movements** like **Fridays for Future**, led by **Greta Thunberg**, represents a call for humanity to transcend national interests in favor of protecting the global environment. **Key Ideas Related to Transcendence in Globalization:** 1. **Global Consciousness and Identity**: People are increasingly identifying as global citizens, not only as members of a nation-state. This global consciousness leads to shared responsibilities, values, and challenges that go beyond local or national identities. 2. **Transnationalism**: Transcendence in globalization often involves **transnationalism**, where individuals and organizations operate and think beyond national boundaries, with complex identities and affiliations to multiple countries and cultures. 3. **The Collapse of Traditional Hierarchies**: In some areas, globalization leads to the transcendence of hierarchical structures---whether in politics, economics, or culture. For instance, the dominance of Western powers or certain cultural norms is being challenged by other rising global powers, creating a more multipolar world. **Examples of Transcendence in Globalization:** - **Climate Change and Global Cooperation**: Climate change has become a global issue that transcends national borders. International agreements like the **Paris Agreement** aim to unite countries in tackling global environmental crises, signaling a transcendence of localized policies in favor of global solutions. - **The Digital Revolution**: The ability of people around the world to access the internet and use technology to communicate, learn, and engage in business transcends national barriers, creating a global digital economy. The **internet** and **social media** platforms are examples of technologies that transcend physical and political borders, allowing for global interactions. - **Global Trade and Multinational Corporations**: Companies like **Nike**, **Apple**, or **Amazon** operate in multiple countries, transcending national borders to create a unified global market. The economic transformations driven by globalization have led to a new form of global capitalism that operates on a transnational level. **ASPECTS OF GLOBALIZATION** 1. **POLITICAL** - Formation of global policy and cooperation 2. **CULTURAL** - Unification of norms, principles, and values 3. **SOCIAL** - Unification of social standard of living 4. **ECONOMICAL** - Strengthening of economic integration and interdependence 5. **ECOLOGICAL** - Degradation of the environment on a planetary scale 6. **TECHNOLOGICAL** - The cross-cultural development and exchange of technology. The speed with which culture is diffused has charged because of technological advancements **THEORIES OF GLOBALIZATION** **WORLD SYSTEM THEORY** - An economic development theory. It seeks to answer the question "Why is economic development not equal?" **WORLD POLITY THEORY** - Conceptualized as a network of state 's, societies, and international government organizations. State remains as important component, but attention goes to global organizations. **WORLD CULTURE THEORY** - An approach of globalization cultivates principles (ideologies, philosophies, meanings, values) that go beyond from local contexts and local histories - tuwiran nitong binago, binabago at hinahamon ang pamumuhay at mga **perennial institutions** na matagal ng naitatag - defined as a politically organized sovereign community independent of outside control bound by penalties of nationhood, legally supreme within its territory, acting through a government functioning under a regime of law **STATE VS NATION** - **State** is a **legal or juridical concept** while a nation is an **ethnic or cultural concept** - **Nation** refers to those **people belonging to the same race** and is **embraced with a common cultural heritage** - The state in order for it to be considered as a state needs the presence of four elements. **THE FOUR ELEMENTS OF THE STATE** 1. **PEOPLE** - Inhabitants or population of the state - A community of person sufficient in number and capable of maintaining the permanent existence of the community and held together by a common bond of law. - Individuals residing within state's territory, sharing citizenship, geographic location, social ties and cultural identity 2. **TERRITORY** - The definite portion of the earth where people reside and must be capable of sustaining of its inhabitants - It is ideal for state's territory to be large enough to sustain the needs of its inhabitants and must be small enough for it to be easily administered and defended **NATIONAL TERRITORY** - Terrestrial Domain - Fluvial Domain (Internal or National Water, Territorial Sea, Exclusive Economic Zone, High Seas) - Aerial Domain **MODES OF ACQUIRING TERRITORY** 1. **Discovery and Occupation** - This occurs when a state discovers a previously uninhabited or unknown land and then takes possession of it. The state must demonstrate control over the area, even if no human inhabitants are present. **Example:** When European explorers \"discovered\" the Americas in the 15th century, they claimed vast territories that were not known to European powers at the time, often establishing settlements. 2. **Cession:** - It is the transfer of territory from one state to another, usually by treaty or agreement**.** **Example**: The Treaty of Guadalupe Hidalgo (1848) ended the Mexican-American War, with Mexico ceding large territories (including California and Texas) to the United States. 3. **Accretion:** - This refers to the gradual addition of land to a state's territory, often through natural processes like erosion, river shifts, or land formations. **Example**: The Mississippi River's shifting course has led to the accretion of new land into the state of Louisiana. 4. **Prescription:** - It is the acquisition of territory by continuous, peaceful possession over a long period, without protest from the original owner. **Example:** After centuries of control, the British could claim sovereignty over territories in India through prescription, as their administration had been uninterrupted and widely accepted. 5. **Conquest:** - This is the acquisition of territory through the use of force or military action, often followed by annexation. **Example:** The Roman Empire expanded its territory through military conquest, incorporating vast regions into its empire. 3. **GOVERNMENT** - The institution inside the state that is composed of the body or entity that provides for the policies that governs the entirely of state affairs and thus by doing so acts as the agents through which state acts - An organized structure of institutions, processes, and authorities that exercise power, enforce laws, provide services and make decisions **Doctrine of Parens Patriae** - guardian of the people **DIFFERENT KINDS/ FORMS OF GOVERNMENT** **AS TO THE NUMBER OF RULERS** 1. **Monarchy** -- kind of government that has singular ruler that has been referred to as the monarch **Example**: **Queen Elizabeth II** was a monarch of the United Kingdom and other Commonwealth realms. She ruled for over 70 years, from 1952 until her death in 2022, making her the longest-reigning British monarch in history. 2. **Aristocracy** -- the power to govern rests on the hands of the few called aristocrats - **r**efers to a form of government or social structure in which power is held by a small, privileged **class,** typically composed of noble families or individuals with inherited titles, wealth, and influence **Example:** **British Aristocracy (House of Lords)**: In the United Kingdom, the aristocracy has historically included the peerage, such as dukes, lords, and barons, who held hereditary titles and lands. The **House of Lords**, a part of the British Parliament, was traditionally composed of these aristocratic figures, though its role has diminished over time. 3. **Democracy** -- rule of the people **Examples:** The United States is a representative democracy, where citizens elect officials to represent their interests in government. The system operates with a balance of power between three branches: the Executive (the President), the Legislative (Congress), and the Judicial (the Supreme Court). Citizens have the right to vote in regular elections for president, members of Congress, and other local and state officials. **Executive:** - **Role:** The executive branch is responsible for implementing and enforcing laws. It manages the day-to-day affairs of the government and oversees the administration of public services and policies. - **Example:** In the United States, the President is the head of the executive, along with their administration (e.g., cabinet members and agencies). **Legislative:** - **Role**: The legislative branch makes, amends, and passes laws. It represents the interests of the people and holds the power to approve government policies and expenditures. - **Example:** In the United States, Congress (the Senate and House of Representatives) is the legislative body that creates laws. - **Role:** The judicial branch interprets laws and ensures they are applied fairly. It resolves legal disputes and protects the rights of individuals by reviewing the constitutionality of laws and government actions. - **Example:** In the United States, the Supreme Court and other federal courts form the judicial branch, interpreting the laws and ruling on legal cases. 4. **SOVEREIGNTY** - Simply means independence or freedom from outside control in the conduct of domestic and foreign affairs of the state - The ultimate power of the state to govern itself **INHERENT POWER OF THE STATE** - The three inherent power of the state can exist without the mandate of law or a constitution - The state cannot exist without its inherent power - Fundamental power of the state -- due to their immediate importance to the continuing existence of the state **POLICE POWER** - The most pervasive and the least limitable of all inherent powers - refer to the inherent authority of a state or government to regulate behaviors and enforce order within its territory, often to protect public health, safety, morals, and general welfare **Example**: During the COVID-19 pandemic, many states in the U.S. used their police powers to impose public health measures such as **mandatory quarantines**, **mask mandates**, and **social distancing** to protect the health of the population. These actions are within the state\'s police powers to protect public health during an emergency. **POWER OF EMINENT DOMAIN** - the power of the state to take any kind of private property provided it is for public welfare with the payment of just and reasonable compensation **Example:** Governments can use eminent domain to acquire land for building new public schools. For instance, a local government may use eminent domain to take a piece of residential property to build a new school to accommodate a growing population of students. **POWER OF TAXATION** - the power in which taxes (proportional contribution paid by the inhabitants of the state) are collected - refers to the government\'s authority to impose taxes on individuals and businesses to raise revenue for public purposes. This power is essential for funding government functions, such as infrastructure, defense, public services, and welfare programs. **Example**: In the United States, the federal government imposes an **income tax** on individuals and businesses. This tax is a percentage of a person's or a company's earnings, and it is used to fund various government functions, including defense, social security, education, and healthcare **OTHER IMPORTANT COMPONENTS IN INTERSTATE SYSTEM** **INTERNATIONAL ORGANIZATIONS** **GLOBAL/ UNNIVERSAL** - World Bank; United Nations Educational, Scientific, and Cultural Organization (UNESCO) **REGIONAL** - United Nations (UN): Asia Pacific Economic Community (APEC); European Union (EU) **PURPOSIVE** - General (EU, UN) - Specific (WHO) **INTERNATIONAL NON-GOVERNMENTAL ORGANIZATIONS** - Independent of governments and can be seen as two types: **advocacy NGO's**, which aim to influence governments with a specific goal, and **operational NGO's**, which provides services - Examples of NGO mandates are environmental preservation, human rights promotions or the advancements of women **MULTINATIONAL CORPORATIONS** - Is a company that has business operation in at least one country other than its home country - Generally, a multinational company has offices, factories, or other facilities in different countries around the world as well as a centralized headquarters which coordinates global managements **THEORIES OF INTERNATIONAL RELATIONS** **REALISM** - Inspired from the philosophy of Thucydides, St. Augustine, Niccolo Machiavelli, and Thomas Hobbes - in the discipline of international relations, realism is a school of thought that emphasizes the competitive and conflictual side of international relations **LIBERSLISM** - proposed **by Dante Alighiere** in his book "Monarchy" during the 4^th^ century, promoted by **US President Woodrow Wilson** during the 20^th^ century in his role in the establishment of League of nations after the WW1 - a defining feature of modern democracy, illustrated by the prevalence of the term 'liberal democracy' to describe countries with fair elections, rule of law and protected civil liberties - is based on the moral agreement that ensuring the right of an individual person to life, liberty and property Is the highest goal of government - consequently, liberals emphasize the well-being of the individuals as the fundamental building block of a just political system - a core argument of liberalism is that concentrations of unaccountable violent power are the fundamental threat to individual liberty and must be restrained **Liberalism:** - **View of Human Nature:** Optimistic; believes humans can cooperate and improve relations. - **Core Idea:** Countries can work together to solve common problems and create a peaceful, stable world through cooperation, international organizations, and laws. - **Role of International Institutions:** Supportive; believes in the importance of organizations like the United Nations (UN), treaties, and international laws to promote peace and cooperation. - **Focus on Trade and Interdependence:** Emphasizes that economic cooperation and global trade lead to peace, as countries that trade are less likely to go to war. - **Example:** The creation of the European Union (EU), where countries work together politically and economically to prevent war and foster cooperation. Realism: - **View of Human Nature:** Pessimistic; believes humans (and states) are driven by power and self-interest. - **Core Idea:** Countries are primarily motivated by their own interests and security, which often leads to conflict. The international system is anarchic, meaning there's no higher authority to enforce rules. - **Role of International Institutions:** Skeptical; sees international organizations as weak and ineffective because states usually ignore them when their interests are at stake. - **Focus on Power and Security:** Emphasizes military power and the need for states to act in ways that ensure their own survival, often through balance-of-power strategies. - **Example:** The Cold War, where the U.S. and the Soviet Union competed for global influence and security, driven by their self-interest and military power. **Comparison:** - **Human Nature:** Liberals are more optimistic, believing cooperation is possible, while realists are more cynical, believing conflict is inevitable due to power struggles. - **International Cooperation:** Liberals believe in the effectiveness of international organizations, treaties, and laws; realists focus on the limitations of these institutions and stress that power and security are the key concerns. - **Approach to Peace:** Liberals believe peace is possible through cooperation and interdependence; realists believe peace is achieved by balancing power and maintaining a strong military. **In short:** - Liberalism sees the world as capable of cooperation and peaceful coexistence through institutions and shared values. - Realism sees the world as a competition for power, where survival and national interests drive state behavior. - Important role of international organizations, International Non-Governmental Organizations, Multinational Corporations, Religious Organization - Pagtutulungan - Diplomacy over military power - refers to a situation where countries, businesses, or individuals rely on each other for resources, goods, services, or security **Example**: Countries like **China** and the **United States** are economically interdependent due to trade. China manufactures goods that the U.S. imports, while the U.S. exports technology and agricultural products to China. This interdependence creates mutual benefits and strengthens their economic ties, making conflict less likely since both depend on the other for economic growth. **DEPENDENCE** - based on the philosophy of Karl Max - World system theory - Capitalist system - refers to a situation where one country, organization, or individual relies on another for resources, support, or economic well-being. Unlike interdependence, which involves mutual reliance, dependence implies a one-sided reliance, often resulting in vulnerability. **ANG PANDAIGDIGANG EKONOMIYA** **ECONOMICS** - a social science that focuses on the production, distribution, and the consumption of goods and services, and analyzes the choices that individuals, business, governments, and nations make to allocate resources **PANDAIGDIGANG EKONOMIYA** - it is the result of human innovation and technological progress. It is characterized by the increasing integration of economies around the world through the movement of goods, services, and capital across borders - kalakalan ng mga produkto at serbisyo; pamilihan ng mga pananalapi at puhunan; teknolohiya at talastasan; produkto o paggawa **GLOBALIZATION VS. INTERNALITIZATION** - **Localization** is the adaptation of a particular product or service to one of those markets - Refers to the adaptation of products, services, or content to meet the specific needs of a local market or culture. This often involves changing language, design, marketing, or features to suit the preferences and requirements of a particular region. **Example**: McDonald's is a great example of localization. While McDonald\'s is a global brand, it adapts its menu to suit local tastes. In India, McDonald\'s offers vegetarian options like the McAloo Tikki burger (a potato-based patty) because many people in India do not eat beef or pork. Similarly, in Japan, McDonald\'s has introduced the Teriyaki McBurger, which uses teriyaki sauce, a flavor popular in Japanese cuisine. - **Globalization** refers to the process by which a company brings its business to the rest of the world - is the process of increasing interconnectedness and interdependence among countries, cultures, and economies, driven by trade, communication, and technology. It involves the spread of ideas, goods, and services across national borders. **Example:** The internet is a prime example of globalization. Platforms like Google, Facebook, and YouTube have users from all over the world, enabling global communication, information sharing, and business transactions. A person in the U.S. can interact with someone in India, watch videos from **Brazil**, and shop from an online store in **China**---all examples of globalization in action. - **Internalization** is the practice of designing products, services and internal operations to facilitates expansions into international markets - refers to the process by which companies expand their operations, products, or services to other countries. It involves the strategies that businesses use to enter foreign markets, often with less adaptation than in localization. **PINAGMULAN NG GLOBALISASYON** **SILK ROAD (SILK ROUTE)** - first global trade route in history - 1,500 years; 130 BCE until 1453 CE - It is hard to overstate the importance of silk road on history. Religion and ideas spread along the silk road just as fluidly as goods. Towns along the route grew into multicultural cities. The exchange of information gave rise to new technologies and innovations that would change the world - The Silk Road was an ancient network of trade routes that connected the East and West, facilitating the exchange of goods, culture, and ideas. It began around the 2nd century BCE and stretched from China through Central Asia to the Mediterranean, including key regions like India, Persia (modern-day Iran), and Rome. - The name \"Silk Road\" comes from the **lucrative trade in silk that was carried along these routes**, but other goods such as spices, precious metals, tea, and paper were also traded. In addition to material goods, the Silk Road helped spread cultural exchanges, including religions (like Buddhism), technologies, and artistic styles. The route remained significant until the 15th century when maritime trade routes began to dominate. - Took place during the age of mercantilism (16^th^ -- 18^th^ century) - Spanish sailing vessel that made an annual round trip (one vessel per year) across the pacific between Manila, in the Philippines, and Acapulco, in present Mexico, during the period 1565 -- 1815. They were the sole means of communications between spain and its Philippine colony and serve as n economic lifeline for the Spaniards in Manila - The Galleon Trade was a system of trade that took place between the Philippines and Mexico from the late 16th century to the early 19th century, during the period of Spanish colonial rule. Spanish galleons (large, multi-decked sailing ships) carried goods across the Pacific Ocean, linking the Spanish colonies in the Philippines and Mexico - The galleon trade began in 1565, when the first official Spanish galleon route was established between Manila (in the Philippines) and Acapulco (in Mexico). The ships transported valuable goods like silk, spices, porcelain, and luxury items from Asia to the Americas, and in return, they carried silver from the Americas to Asia. - This trade route was crucial for global commerce, linking the Pacific and the Atlantic world, and played a significant role in the spread of goods, culture, and ideas between the East and West. The trade continued until 1815, when it was phased out due to changes in international trade patterns and the rise of other maritime routes. **INTERNATIONAL MONETARY SYSTEM** - Provides the institutional framework for determining the rules and procedures for international payments, determination of exchange rates, and movements of capital **ERA OF BIMETALLISM** - Before 1870, where both gold and silver coins were used as the international modes of payment. The exchange rates among currencies were determined by their gold or silver contents. Some countries were either on a gold or silver standard - the **Era of Bimetallism** refers to a period in history when a country's monetary system was based on two metals---**gold** and **silver**---as the standard for currency. Both metals were used to mint coins, and their value was fixed in a specific ratio (e.g., 15:1, meaning 15 ounces of silver were equivalent to 1 ounce of gold). **GINTONG PAMANTAYAN** - 1875 -- 1914, gold alone is assured of unrestricted coinage. There was a two-way convertibility between gold and national currencies at a stable ratio. - The gold standard is a monetary system in which paper money is freely convertible into a fixed amount of gold - Pinaniniwalaan na gagarantiyahan nito ang isang walang implasyon, matibay na kapaligirang pangkalakalan, at isang epektibong makinarya sa isang mabilis na pandaigdigang kalakalan - U.S dollars were convertible to gold at a rate of **\$20.67 per ounce** - **Dollars to Gold:** Divide the dollar amount by the price of gold per ounce. - **Gold to Dollars:** Multiply the amount of gold by the price of gold per ounce. - The gold standard prevents inflation as governments and banks are unable to manipulate the money supply (e.g., over issuing money) The gold standard also stabilizes prices and foreign exchange rates - Under the gold standard, the supply of gold cannot keep pace with its demand and is not flexible under trying economic times. Also, mining gold is costly and creates negative environmental externalities - The Bretton Woods Agreement was negotiated in July 1944 by delegates from 44 countries at the United Nations Monetary and Financial Conference held in Bretton Woods, New Hampshire - Gold was the basis for the U.S dollar and other currencies were pegged to the U.S, dollar's value - Goals of creating an efficient devaluation of currencies, and promoting international economic growth - **\$35 per ounce** - **International Monetary Fund (IMF) -** to monitor exchange rates and identity nations that needed global monetary support - **World bank** -- to manage funds available for helping countries that had been physically devastated by WW2 **FIAT MONETARY SYSTEM** - **"Fiat"** is a latin word that is often translated as "it shall be" or "let it be done" - **Fiat Money** is a government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it - The values of that fiat money is derived from the relationship between supply and demand and the stability of the issuing government - Floating rate system - fiat monetary system is a type of currency system where money has no intrinsic value and is not backed by a physical commodity like gold or silver. Instead, the value of the currency is established by government decree (fiat), meaning it is valued because the government says it is. - Most modern economies, including the U.S. dollar and Euro, operate under a fiat system. The money\'s value is largely based on trust in the government and the economy, rather than a physical asset. **FLOATING RATE SYSTEM** - A floating exchange rate is a regime where the currency price of nation is set by the forex market based on supply and demand relative to other currencies - Floating exchange rate became more popular after the failure of the gold standard and the Bretton Woods Agreement - A floating rate system is a currency exchange system where the value of a country\'s currency is determined by market forces, such as supply and demand, rather than being pegged to another currency or a commodity like gold. In this system, the value of the currency can fluctuate freely in the foreign exchange market. For example, the U.S. dollar and the Euro are traded in a floating exchange rate system, meaning their value changes based on factors like economic conditions, interest rates, and investor sentiment. **ADVANTAGES OF FIAT MONEY** - Gives central banks greater control over the economy - Is cost-efficient to produce - Provides governments with flexibility **DISADVANTAGES OF FIAT MONEY** - Is not fool-proof way to protect the economy - Creates opportunity for a bubble - Provides risk of inflation **MARKET INTEGRATION** **MARKET** - Is a place where parties can gather to facilitate the exchange of goods and services. The parties involved are usually **buyers and sellers.** The market may be **physical**, like a retail outlet, where people meet face-to-face, or **virtua**l, like an online market, where there is no physical presence or contact between buyers and sellers - Establish the prices of goods and services, determined by supply and demand **MARKET STRUCTURE** 1. Perfect Competition 2. Monopolistic Competition 3. Oligopoly 4. Monopoly 1. **Perfect Competition**: - **Explanation**: In perfect competition, there are many sellers offering identical products, and no single seller has market control. Entry into the market is easy, and information is perfectly available to all participants. - **Example**: Agricultural markets, like wheat or corn, where many farmers sell identical products, and no single farmer can influence the price. 2. **Monopolistic Competition**: - **Explanation**: This market structure features many firms that sell similar, but not identical, products. There is some level of product differentiation, and firms can influence prices to a degree. However, there are still low barriers to entry. - **Example**: Restaurants or clothing brands, where many businesses sell similar goods but differentiate themselves through branding or features. 3. **Oligopoly**: - **Explanation**: An oligopoly consists of a few firms that dominate the market. These firms sell either identical or differentiated products. The actions of one firm can influence others, and there are significant barriers to entry. - **Example**: The automobile industry (e.g., Ford, Toyota, and Honda) or mobile phone providers (e.g., Verizon, AT&T, T-Mobile) where a small number of firms control the market. 4. **Monopoly**: - **Explanation**: A monopoly exists when a single firm controls the entire market for a particular good or service, with no close substitutes available. Barriers to entry are extremely high, and the monopolist has significant price control. - **Example**: Utility companies (e.g., local water or electricity providers) often operate as monopolies because it\'s not practical to have multiple competing firms providing the same service in a given area. **KEY DIFFERENCES** - **Perfect Competition** has the highest level of competition with many firms and no market control. - **Monopolistic Competition** features many firms and some control over prices due to product differentiation. - **Oligopoly** is dominated by a few firms with significant market control and interdependence. - **Monopoly** has no competition, with a single firm controlling the entire market and setting prices freely. 1. **Underground Market** - An illegal market where transactions occur without the knowledge of the government or other regulatory agencies **Drug Trade**: One of the most common examples of an underground market is the illegal drug trade. Drugs such as **cocaine**, **marijuana**, or **heroin** are bought and sold without government approval or regulation, often at much higher prices than their legal counterparts, and are typically exchanged in secret or untraceable ways. 2. **Auction Market** - The buyers or bidders try to top each other for the purchase price. The items for sale go to the highest bidder 3. **Financial Market** - Any places where securities, currencies, and bonds are traded between two parties. These markets are the basis of capitalist societies, providing capital formation and liquidity for businesses. - A financial market is a marketplace where buyers and sellers trade financial assets such as stocks, bonds, commodities, and currencies. **Ex. Foreign Exchange Market (Forex)**: Where currencies are traded. For example, the exchange rate between the **U.S. Dollar (USD)** and the **Euro (EUR)** is determined in the Forex market. **INTEGRATION** - The action or process of combining two or more things in an effective way - Ang proseso na pinagsama sama ang magkakahiwalay na nasyonal na ekonomiya patungo sa mas malaking pang ekonomikong rehiyon **MARKET INTEGRATION** - Markets are integrated if prices among different locations move in similar patterns - Economic integration is an arrangement among nations that typically includes the reduction or elimination of trade barriers and the coordination of monetary and fiscal policies. Economic integration aims to reduce costs for both consumers and producers and to increase trade between the countries involved in the agreemen **TARIFFS** - is a tax imposed by one country on the goods and services imported from another country to influence it , raise revenues, or protect competitive advantages **FIVE DIMENSION OF MARKET GLOBALIZATION** **(Cavusgil, 1993)** 1. Fluid nature of manufacturing and sourcing activities 2. Increase in level of competition between consumer and market due to globalization 3. Increase in international transactions 4. Technological advancements 5. Borrowing-financing **2 TYPES OF INTEGRATION** 1. **Positive integration --** pakikibahagi ng pamahalaan 2. **Negative Integration -** hindi panghihimasok ng pamahalaan **PREFERENTIAL AGREEMENT** - Key idea : "believe that more agreements = more trade and growth in developing nations - Countries in trading block give preferential access to products from other member nations - This is done through reducing tariffs, not eliminating it - Theses can me **bilateral** or **multilateral** - Example is EU and the African, Caribbean, and Pacific (ACP) group states - A **preferential trade agreement (PTA)** is a trade pact between countries that offers preferential access to certain products or services, usually by reducing tariffs or offering other trade benefits. Unlike free trade agreements (FTAs), which remove most barriers to trade, a PTA provides reduced tariffs or concessions only on certain goods and services between the participating countries, rather than across all goods. **Example:** - The **South Asian Free Trade Area (SAFTA)** is an example of a PTA between countries in South Asia, where member countries enjoy lower tariffs on selected products traded within the region. **FREE TRADE AREA** - a free-trade agreement between countries, where the countries agreed to trade freely among themselves but can trade with other countries outside of the free-trade area in whatever way they wish - A **Free Trade Area** (FTA) is a region where a group of countries agrees to reduce or eliminate trade barriers, such as tariffs and quotas, on goods and services traded among them. However, each country maintains its own trade policies toward non-member countries. - **custom external tariff for non-members** **Example:** The North American Free Trade Agreement (NAFTA), which includes the United States, Canada, and Mexico, is a well-known example of an FTA. Under NAFTA, these three countries eliminated many tariffs and trade barriers between them, allowing for smoother and cheaper trade. However, each country still has its own trade rules for dealing with countries outside the agreement **CUSTOM UNIONS** - a custom union is an agreement made between countries, where the countries agreed to trade freely among themselves, and they also agreed to adopt common external barriers against any country attempting to import into the custom union - putting **common external tariff** (para sa isang bans ana hindi bahagi ng usapan) which must be on the same amount of tariff **Example:** The European Union (EU) is a prominent example of a Customs Union. EU member countries trade freely with each other, but they also have a common external tariff on goods coming from outside the union. For instance, if a country outside the EU exports goods to the EU, it faces the same tariff regardless of whether the goods enter through Germany, France, or Italy. **COMMON MARKET** - a common market is custom union with common policies on product regulation, and free movement of goods, services, capital, and labor - Mobilization of labor and capitalist; no restrictions(seamless movements - **ECONOMIC UNION** - An economic/ monetary union is a common market with a common currency and a common central bank - Countries integrate and collaborate on the level of monetary policy, fiscal policy, and other tax policy as well **Example:** The European Union (EU) has evolved from a Customs Union to a Common Market. In addition to removing tariffs and adopting a common external tariff, the EU also allows citizens of member countries to live and work in any EU country, and businesses can operate across borders without many restrictions. This creates a highly integrated economic area, where goods, services, people, and capital move freely. **COMPLETE ECONOMIC INTEGRATION** - This would be final stage of economic integration at which point the individual countries involved would have no control of economic policy, full monetary union, and complete harmonization of fiscal policy - This is what the eurozone moving is towards - is the highest level of economic integration between countries. It goes beyond a Common Market and involves the full unification of economic policies and the establishment of a single economic entity, which may include a shared currency, unified fiscal and monetary policies, and harmonized economic regulations. **Example:** The European Union (EU), particularly the Eurozone, is an example of near-complete economic integration. The EU members have removed trade barriers, adopted a common external tariff, and the Eurozone countries have adopted the euro as a common currency. The European Central Bank (ECB) manages the monetary policy for these countries, while fiscal coordination is promoted through the Stability and Growth Pact. Additionally, there is significant political cooperation through EU institutions like the European Parliament and European Commission. **LAW OF ONE PRICE** - Assumption: competitive markets, no transaction costs, no official trade barriers, tradable goods - Is an economic concept that states that the price of an identical asset or commodity will have the same price globally, regardless of location, when certain factors are considered - The law of one price is the foundation of purchasing power parity. Purchasing power parity states that the value of two currencies is qual when a basket of identical goods is priced the same in both countries. It ensures that the buyers have the same purchasing power across global markets - states that in an efficient market, identical goods or assets should sell for the same price when expressed in a common currency, once transportation costs and trade barriers (such as tariffs or taxes) are accounted for. In other words, the price difference between two markets for the same good should be negligible after considering costs of moving the product between them. **Examples**: Suppose a smartphone costs \$500 in New York, USA. According to the Law of One Price, in a market without barriers or costs, the same smartphone should also cost €500 in Paris, France, when exchange rates are considered. If the cost is higher in one location (say €600 in Paris), it could be due to additional factors like tariffs, taxes, or shipping costs, which prevent the price from being equal **PURCHASING POWER** - The amounts of goods and services you can buy with a certain amount of money - Purchasing power is the value of currency expressed in terms of the number of goods or services that one unit of money can buy. It can weaken over time due to inflation. That's because rising prices effectively decrease the number of goods or services you can buy. It is also known as currency's buying power **Example: Cost of living.** If someone in a high-cost country like Switzerland earns 100,000 CHF, their purchasing power might be lower than someone in a low-cost country like India earning 30,000 INR because prices in Switzerland are much higher across the board, even if the nominal income in Switzerland seems higher. **PURCHASING POWER PARITY** - It is based on the Law of One Price and refers to situation where your income has the same purchasing power in all countries. - It is an economic theory that estimates the amount by which an item should be adjusted for parity, given two countries' exchange rates - It can be used to compare countries' economic activity, income levels, and other relevant data concerning the cost of living, or possible rates of inflation and deflation - is an economic theory that suggests that in the absence of transportation costs and other trade barriers, identical goods or services in different countries should have the same price when expressed in a common currency. In simpler terms, PPP indicates that exchange rates between currencies should adjust so that the purchasing power of each currency is equal when used to buy the same basket of goods and services. **Example:** Currency Overvaluation/Undervaluation: If the exchange rate between the U.S. dollar and the Indian rupee is 1 USD = 75 INR, but the same basket of goods costs significantly more in India than in the U.S., the Indian rupee may be undervalued, meaning people in India need more rupees to buy the same goods as someone in the U.S