TCWD-Prelim.pdf

GLOBALIZATION GLOBAL ECONOMY The development of an increasingly integrated global economy marked - Global changes are attributed to how the global economy is organized by free trade, free flow of capital, and...

GLOBALIZATION GLOBAL ECONOMY The development of an increasingly integrated global economy marked - Global changes are attributed to how the global economy is organized by free trade, free flow of capital, and cheaper foreign labor markets and governed. These changes give impact to the flow of goods and (Webster) services across national borders, and the implications for how a particular Advancements in technology, culture, and economy of countries by country move up and down in the international scene. (Gary Gereffi, The active exchange of products, services, knowledge, cultural products, Global Economy: Organization, Governance and Development) languages - Inherently interdisciplinary, can be studied at different levels of analysis: “Understanding of the world and the increased perception of the world as Macro Level – includes international organizations and regimes that a whole” (Robertson, 1992) establish rules and norms for global community. (The World Bank, “All those processes by which the people of the world are incorporated International Monetary Fund, World Trade Organization, International into a single world society. This only means that people around the globe Labor Organization, EU, NAFTA) live in a borderless community.” (Albrow and King, 1990) Meso Level – countries and firms, believed to be the building blocks for Process of intensifying social relationships among countries around the global economy. Global economy is seen as an arena where countries world connecting separate localities in a manner in which local events are compete in different product markets. formed as a result of happenings that have occurred from afar. (Giddens, Micro Level – stores and local market 1991) World System Theory Advances in modern technologies that have made international transactions Upward or downward mobility of nations in the core, semi-periphery, and periphery is determined by their mode of incorporation in the Countries with the most advanced economies are the countries with most capitalist world economy. (division of labor) modern technology based on science and knowledge. Division of Labor – specialization of workers in different parts of the Five Core Claims of Market Globalism production process. 1. Globalization is about the liberalization and global integration of market Industrial (developed) countries produce manufacture goods; non- 2. Globalization is inevitable and irreversible industrialized (developing) economies supply raw materials and 3. Nobody is in charge of globalization agricultural products 4. Globalization benefits everyone 5. Globalization furthers the spread of democracy in the world MARKET INTEGRATION - It can be misleading to rely on price as a criterion for integration. Markets are integrated if adjustment mechanisms operate to correct - Process to combine separate national economies into larger economic deviations from a wage differential or “gap”. (Roberts, 2000) regions. Global Corporation Types of Integration Either a Multinational Corporation (MNC), Transnational Corporation Negative Integration – reduces non-tariffs and tariff barriers to trade as (TNC), International Company, or a Global Company. a main tool for integrating markets International Companies – importers and exporters, typically without Positive Integration – adjust domestic policies and institutions through investments outside of their home country the creation of supranational arrangements. Multinational Companies – have investments in other countries, but do Supranational Agreements – type of multinational political union where not have coordinated product offerings in each country; more focused on negotiated power is delegated to an authority by governments of member states. adapting their products and services to each individual local market Forms of Integration Global Companies – have invested in and are present in many countries; typically market their products and services to each individual local Preferential agreement – involves lower trade barriers between countries market that have signed the agreement. Transnational Companies – complex organizations which have Free Trade Area – reduces trade barrier to zero among member countries. invested in foreign operations; have a central corporate facility but give Customs Union – countries agree to abolish tariff and non-tariff barriers decision-making, research and develop and marketing powers to each to trade in goods flowing between them. individual foreign market Common Markets – allows free movement of labor and capital within the Transnational Companies – enterprises that engage in activities which member countries. add value (manufacturing, extraction, services, marketing, etc.) in more Economic Union – highest form of economic integration. than one country Complementary Criteria of Integrated Labor Markets Three Fundamental Innovations that substantially changed the character of Global Corporation Wages do not diverge from a common trend Over time wage dispersion does not increase - The advent and impact of digitalization and instantaneous global Correction mechanism pushes wages towards equilibrium relationship communications aftershocks - Structural transformation of global commerce from producer-driven commodity chains to buyer-driven  - Increasing role performed through the global system by financial - no reciprocity of civilized behavior could be expected elements and the emergence of the global national firm - ‘rules of International Law only apply to warfare between civilized nation... They do not apply to wars with uncivilized states or tribes’ Three Structural Periods (Geriffe) Investment-based globalization (1950 – 1970) - dominated by producer- driven commodity or value chain CONTEMPORARY GLOBAL GOVERNANCE Trade-based globalization (1970 – 1995) Sovereign State – has a territory, the people, and a government Digital globalization (1995 onwards) Any state admitted as a member of the United Nations will be upon the decision of the General Assembly as recommended by the Security Council. GLOBAL INTERSTATE SYSTEM United Nations Membership Requirements International Law – designed as an aid to the preservation of order among - State must be a peace-loving state which accepts the obligations sovereign states; its principles only applying to civilized states contained in the present Charter - a product of special civilization of modern Europe and forms a highly artificial - In the judgment of the Organization, must be able and willing to carry out system of which the principles cannot be supposed to be understood or these obligations recognized by countries differently civilized. - Chapter 2, Article 4 of the United Nations Charter states that only sovereign states can be members of the United Nations Three Categories of Humanity – civilized, barbaric, and savage - Belarus, India, Philippines, and Ukraine, were not independent at the Three Corresponding Grades of Recognition – plenary political, partial time of their admission in the organization political, natural or mere human) Transnational Actors Victorian International Law - Intergovernmental Organizations (IGOs) Inside Europe – protection of property, rule of law on the basis of codes or - International Nongovernmental Organizations (INGOs) institutions, effective administration of its territory by a state, warfare - Transnational Corporations (TNCs) conducted by a regular army, freedom of conscience Laws of War – codified by the Great Powers - designed to minimize the severity of conflicts between civilized states