The Contemporary World PDF

THE CONTEMPORARY It usually focuses on understanding global issues, international relations, and the various economic, p...

THE CONTEMPORARY It usually focuses on understanding global issues, international relations, and the various economic, political, and social forces shaping the modern WORLD world. Topics such as globalization, sustainable development, 🡪This course introduces students to the contemporary human rights, cultural diversity, and global world by examining the multifaceted phenomenon of governance. globalization. 🡪Using the various disciplines of the social sciences, it In this subject, students are encouraged to critically examines the economic, social, political, technological, analyze current global events and trends, and other transformations that have created an understanding their impact on both local and increasing awareness of the interconnectedness of international levels. It aims to equip students with a peoples and places around the globe. global perspective, helping them to navigate and contribute to the increasingly interconnected world. Phenomenon- a fact or situation that is observed to exist or happen, especially one whose cause or explanation is in question. WHAT IS THE IMPORTANCE OF STUDYING synonyms: occurrence, event, happening, fact, THE CONTEMPORARY WORLD? situation, circumstance, experience, case, incident, episode "a rare phenomenon" 1. To understand the current state of global affairs. What is Contemporary World? The events, trends, and challenges happening today Trends- a general direction of change : a way of will shape the collective future, so learning about the behaving, proceeding, etc., that is developing and contemporary world gives useful context for becoming more common decisions that lie ahead. Issues- an important topic or problem for debate or 2. It develops global awareness and cultural discussion. sensitivity. The world is increasingly interconnected, so The current modern era that we are living in today, as understanding different cultures, viewpoints, and opposed to past or future time periods. global systems promotes cross-cultural competence. This can help us work together more effectively on More specifically, it has a few key meanings: shared problems. It encompasses the issues, events, trends, technologies, and global systems that define the 3. It fosters informed participation in civic life. world from approximately the late 20th century up As citizens of the world, we are all stakeholders in until the present day. addressing issues like conflict, human rights, trade, development, and sustainability. Studying This includes things like globalization, the digital contemporary affairs empowers us to make revolution, climate change, geopolitics, etc. well-informed decisions and contribute meaningfully to these important discussions. It reflects the world as we directly experience it in our own lifetime, rather than as something in the distant 4. The contemporary world is highly dynamic. past or something not yet realized. What's happening now may look quite different even just a few years in the future. Regularly learning about Studying the contemporary world examines the current events and trends assumptions helps us adapt realities of the here-and-now. to changing circumstances and avoid outdated It focuses on developments that are happening 5. It supports career preparation. across the world simultaneously, recognizing how Many fields like international relations, journalism, increased connectivity means all nations are part of foreign policy, and global business require an one globalized contemporary system/reality. understanding of the modern global landscape. It is a constantly evolving frame of reference, as what Studying contemporary world issues provides relevant is considered "contemporary" changes over time. knowledge and skills for a wide range of career paths. It emphasizes understanding the defining features of 2 Timothy 3:1 the current era - things like trends, events, This know also, that in the last days perilous times technologies, movements, etc. - that collectively shall come. shape the world we live in today on a global scale. Issues that were part of the contemporary world 30 2 Timoteo 3:1 - Datapuwa't alamin mo ito, na sa years ago may now be seen as historical, while new mga huling araw ay darating ang mga panahong challenges emerge. mapanganib. So in summary, the "contemporary world" refers to Being knowledgeable about the present-day world the globally interconnected modern system we inhabit around us is crucial for both our personal development right now in the late 20th/early 21st century, as and ability to positively shape the future through opposed to other historical periods or hypothetical informed and engaged participation. future scenarios. It captures the realities of the world as we experience it in the present day. Challenges Faced by The Contemporary ➔ it is an increased flow of trade, people, World technology, culture and ideas among countries. ➔ It is the movement towards the expansion of 1. Migration of Refugees economic and social ties between countries Migration- movement from one part of something to through the spread of corporate institutions another. and the capitalist philosophy that leads to the shrinking of the world in economic terms. Refugees- number of people who have been force to leave their country in order to escape war, persecution, or natural disaster. Generally, globalization refers to the development of universal connection, integration and 2. Cultural Differences interdependence of economic, social, 🡪 Ethnic or Indigenous- cultural group with technological, cultural, political, and common national or cultural tradition. environmental spheres. (Arion, 2014) 3. Religious/Ethnic Conflicts Religion- sect of faith or beliefs. Categories of Globalization Ethnic Groups 1. Economic globalization - 4. New Technologies is the growing global integration not only of markets Communication (everyday life) but also of systems of finance, commerce, Transportation communication, technology, and law that bypass Medicine traditional national, cultural, ethnic, and social Artificial Intelligence boundaries. 5. Poverty Poverty It leads to more efficient division of labor, greater Poor Health specialization, increased productivity, higher standards Illiteracy of living and wealth, and ultimately the end of Famine poverty. (Proponents of economic globalization) 6. Terrorism Singapore is ahead in the ranking in terms of economic 🡪It is the use of violence and threats to intimidate and globalization. This means that this country is able to coerce for political reasons. Examples: suicide perform well in terms of capital and services bombers, hijackers, and bombing threats. spearheaded by its Singapore Airlines, world class airport, shipping terminals, and oil refinery. ISIS NPA 2. Social Globalization - MILF/MNLF The impact of globalization on the life and work of AL-QAEDA people, on their families, and their societies. BIFF ABU SAYYAF Impact on employment, working conditions, income MAUTE GROUP and social protection. Beyond the world of work, the social dimension encompasses security, culture and identity, Globalization inclusion or exclusion and the cohesiveness of families and communities. Most scholars of globalization define the concept as a multidimensional set of social processes that The rankings of countries in terms of social create, multiply, stretch, and intensify worldwide globalization. It is dominated by countries in Europe social interdependencies and exchanges; where spread of ideas, information, images, and people are being measured. The exceptional compression of time and space as a result of political, economic, and cultural change, as 3. Political Globalization - well as powerful technological innovations. The amount of political co-operation that exists between different countries. The catchphrase ‘globalization is happening’ implies that we are moving from the modern socio-political This ties in with the belief that “umbrella” global order of nation states that gradually emerged in the organisations are better placed than individual states seventeenth century toward the postmodern conditions to prevent conflict. of globality. The League of Nations established after WW1 was Hence, like modernization and other verbal nouns that certainly one of the pioneers in this. Since then, global end in the suffix ‘-ization’, the term globalization organisations such as the World Trade Organisation suggests the notion of ‘development’ or ‘unfolding’ (WTO), United Nations (UN), and more regional along discernable patterns. organisations such as the EU have helped to increase the degree of political globalisation. Such unfolding may occur quickly or slowly, but it always corresponds to the idea of change, and European nations dominate the roster of countries therefore, denotes the alteration of present with high political globalization ranking. The conditions. (Steger, 2005) Globalization Index Field of Political Globalization measures the diffusion of government ➔ growth to a global or worldwide scale. policies in terms of the number of embassies, and consulates in a country, membership in the OPEC (Organization of Petroleum Exporting international organization, and the participation in the Countries) United Nations peace missions. 🡪The Organization of the Petroleum Exporting Countries (OPEC) is a group of oil-rich countries that The Divide Between Developed and together control nearly 40 percent of the world’s oil Developing Countries supply. 🡪sought to build a united front to respond to oil price The United Nations Development Program cuts imposed by the multinational oil companies (UNDP) rates countries’ development annually that controlled most petroleum imports into Western according to its Human Development Index (HDI) countries, as well as U.S. government import caps that which includes measurements of citizens’ access to depressed prices of foreign oil in the 1950s. healthcare, educational attainment, and standards of living. Members not only set out to negotiate higher global posted prices for oil but also pursued greater control The Human Development Index (HDI) is a over their own resources through the nationalization of summary measure of average achievement in key international oil company concessions. dimensions of human development: a long and healthy life, being knowledgeable and have a 81.5% of the world’s proven crude oil reserves are decent standard of living. located in OPEC member countries. The HDI is the geometric mean of normalized indices Founded in Baghdad, Iraq. for each of the three dimensions. Founders: Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. The health dimension is assessed by life expectancy OPEC MEMBERS: Algeria, Angola, Ecuador, at birth, the education dimension is measured by Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi mean of years of schooling for adults aged 25 years Arabia, UAE, Venezuela. and more and expected years of schooling for children Middle East - owns 65.5% of OPEC in total. of school entering age. TOP OIL PRODUCERS The standard of living dimension is measured by “1 fluid barrel= 119.24 liters gross national income per capita. The HDI uses the logarithm of income, to reflect the diminishing LARGEST PROVEN OIL RESERVES importance of income with increasing GNI https://www.visualcapitalist.com/ranking-the-countries (hdr.undp.org). -with-the-largest-proven-global-oil-reserves-in-the-wor ld/ Economic Oil Reserves vs. Oil Production A country with large amounts of reserves does not Globalization always translate to strong production numbers for petroleum, oil, and by-products. Oil reserves simply serve as an estimate of the ECONOMIC TERMS amount of economically recoverable crude oil in a a. International Trade - exchange of goods, particular region. To qualify, these reserves must services, and capital across international borders or have the potential of being extracted under current territories. technological constraints. b. Multinational Corporations - large companies While countries like the U.S. and Russia are low on the that operate in multiple countries beyond their home list of oil reserves, they rank highly in terms of oil country. production. c. Advances in Technology and Communication - More than 95 million barrels of oil were produced the continuous development and innovation in tools, globally every day in 2019, and the U.S., Saudi devices, systems, and methods that enhance the Arabia, and Russia are among the world’s top ability to create, share, process, and store information. oil-producing countries respectively. d. Increase in Cultural Diffusion – the accelerated Large Reserves in OPEC Nations spread and exchange of cultural beliefs, practices, The Organization of the Petroleum Exporting Countries ideas, values, and products between different societies (OPEC) is an intergovernmental global petroleum and and regions. oil distribution agency headquartered in Vienna, Austria. What has led to increased globalization? 1. UN (United Nations)- settles trade disputes The majority of countries with the largest oil reserves among member nations. in the world are members of OPEC. Now composed of 14 member states, OPEC holds nearly 70% of crude 2. WTO (World Trade Organization)- oil reserves worldwide. promotes free trade among the nations in different parts of the world. Most OPEC countries are in the Middle East, the region with the largest oil reserves, holding nearly half of the global share. POSITIVE EFFECTS OF GLOBALIZATION STRUCTURES OF MNC 1. Increased trade gives people more goods and 1. Horizontal Organization services ➔ Expanding with the use of the same structure, 2. Companies lower costs and prices by buying monopoly structure. Ex: Resto-Resto materials and hiring workers from other countries 2. Vertical Organization 3. Creates jobs and raises standards of living ➔ Structures and Industries are related in terms 4. Increases access to medicine and technology of production/products. Ex: ADIDAS (sports wear) NEGATIVE EFFECTS OF GLOBALIZATION 1. Increases the gap between the developed and 3. Diversified Organization developing nations ➔ Different industries are merging to become 2. Outsourcing leads to lower paying jobs in powerful corporations. EX: MICROSOFT developing nations CORPORATION 3. Increases spread of western culture and resentment among non-western nations. ADVANTAGES OF MNC TO THE HOST 4. Increases environmental pollution and the COUNTRY depletion of natural resources. 1. Transfer of technology, capital and entrepreneurship INTEGRATION OF ECONOMIES 2. Increase in the investment level and thus, the The increasing reliance of economies on each income and employment in the host country other. 3. Greater availability of products for local The opportunities to be able to buy and sell in any consumers country in the world. 4. Increase in exports and decrease in imports ➔ The growth of global markets in finance. INTEGRATION OF ECONOMIES MADE POSSIBLE BY: ADVANTAGES OF MNC TO THE HOME 1) Technology COUNTRY 2) Communication Networks 1. Acquisition of raw materials from abroad 3) Internet Access 2. Technology and management expertise 4) Growth of Economic Cooperation acquired from competing in global markets 5) Collapse of Communism 3. Exports of components and finished goods for 6) Movement to Free Trade assembly or distribution in foreign markets 4. In flow of income from overseas profits, MULTINATIONAL CORPORATIONS royalties and management contracts ➔ Corporations that manages production and deliver services in more than one country ➔ Also known as “International Corporations” ➔ According to Franklin Root (1994): ➔ MNC is a parent company ➔ Engages in foreign production through its affiliates located in several countries MNC Exercises direct control over the policies of its affiliates. ➔ Implements business strategies in production, marketing, finance, and staffing that transcend national boundaries How is a company classified as an MNC? 1. Subsidiaries in foreign countries 2. Operations in a number of countries 3. High proportion of assets and revenues from global operations 4. Stakeholders are from different countries HISTORY AND EVOLUTION OF MNC These corporations originated early in the 20th century and expanded after world war II ➔ A multinational corporation developed new products in its native country and manufactured them abroad ➔ Almost all the earliest and largest multinational firms were either Americans, Japanese, or West European ➔ During the last three decades, many smaller corporations have also become multinational ➔ Such enterprises maintain that they create employment, create wealth and improve technology in countries DEVELOPED VS DEVELOPING NATIONS often controlled by dictators and rarely have free markets/capitalism Developed and Developing nations are characterized women have traditional role - homemaker, by different levels of: caregiver 1. Economic Development people often do not realize what it means to ➔ Government truly have liberty ➔ Economy Environment: 2. Population Characteristics What economic factors affect the environment? ➔ Population Rate 1. Economic development – the more economic ➔ Population Growth development you have in your country, the higher the impact on the environment 3. Social Conditions ➔ Poor 2. Rapid population growth – the more people you ➔ Middle Class have in a smaller space, the higher the impact on the ➔ Rich environment Contrasts between Developed and Developing Environmental Impacts nations Pollution ➔ Developed and developing nations are Loss of Habitat characterized by different levels of: Ozone depletion ➔ economic development Global Warming ➔ population characteristics; and ➔ social conditions. FIRST WORLD COUNTRIES VS. THIRD WORLD COUNTRIES Contrasts between developed and developing 1. Factors of production nations A. Human Capital - investment in education, training and experience. B. Physical Capital - tools in a broad sense to make human productive. C. Technological Knowledge- how the world works. D. Organization -organize in a way to produces valuable goods and services. 2. INCENTIVES - imbalance between efforts and payment Characteristics of the Developed World A. Good Institutions better access to technology B. Property Rights stronger more diverse economies C. Honest Government higher literacy rates/better education D. Dependable legal system better access to good health care E. Political Stability slower population growth because of family F. Competitive and open markets planning/birth control usually have capitalism & free markets GDP VS GNP women tend to have equal rights and often Gross Domestic Product work outside the home/get educations as household income countries become developed their citizens want the most commonly used measure of a more liberty and rights country's national income. total of all economic activity in a country, Characteristics of the Developing World regardless of who owns the assets of little access to technology production. weaker economy has to do with the physical location where often dependent solely on one crop or one type it's actually made. of work weak education systems Finished goods- one that will not be sold again as high illiteracy rates part of some other goods. high population growth b/c: Capital Goods- goods that are used to make other 1. less family planning knowledge goods but are still considered finished goods. 2. more kids needed to work on farms 3. high infant mortality rate makes people try to GDP only counts goods and services produced within a have more kids country. Market Value - represents the prices at which these goods and services were sold. It reflects the monetary worth that was generated by economic activity over the course of a year within a country. If a good isn't bought and sold in the market then it's Economic Globalization not typically counted in GDP. The global economy comprises the interconnectedness of worldwide economic activities that take place between multiple countries. Nominal GDP Vs. Real GDP Nominal GDP- prices can increase, GDP number goes These economic activities may have either a up but the economy is not actually producing more positive or negative impact on the countries goods and services. It's inflation that drives for higher involved. GDP. ➔ Measures total value of goods and services The exchange of goods and services across produced at current market prices international borders result to the emergence of the ➔ Prices can increase over time due to inflation free market. even if physical output doesn't change ➔ So nominal GDP can rise just because of higher Neo-liberals seek to transfer control of prices, not actual increased production economic factors to the private sector from the ➔ This means nominal GDP growth can be driven public sector. by inflation rather than real economic growth Leans towards free-market capitalism and away from government regulation and public Real GDP - produce more valuable goods and ownership. services. If the prices of goods and services hadn't However, some theories arguing that because change how much GDP increase? decrease? of neoliberalism, the distribution of the ➔ Accounts for inflation and measures GDP in income is still unequal and widens the constant prices of a base year disparities between the rich and the poor ➔ Allows comparison of GDP over time even as prices change Economic globalization as the increasing ➔ To calculate, nominal GDP is adjusted to interdependence of world economies as a result of the remove the effect of price changes (inflation) growing scale of cross-border trade of commodities ➔ Gives a more accurate picture of whether and services, flow of international capital and wide and physical output and production actually rapid spread of technologies. Shangquan (2000) increased The exchange of goods and services across Example: international borders is widely known as the If nominal GDP grew 5% but inflation was 3%, international trade. real GDP only grew 2% Because 3% of the nominal GDP growth was Expand market for both goods and services that due to higher prices, not increased output otherwise may not have been available domestically. In summary: The market is more competitive Nominal GDP can rise with inflation even if (competitive pricing). no new goods/services are produced Trading globally gives consumers and countries Real GDP shows the true growth in the the opportunity to be exposed to goods and volume/quantity of total output by factoring services not available in their own countries, or out price changes; which would be more expensive domestically. It indicates whether the economy is actually producing more valuable goods/services over Importance of trade as follows: time after accounting for inflation 1. Make use of abundant resources 2. Comparative Advantage GNP/GNI 3. Greater choice for consumers Gross National Product -total income that is earned 4. Specialization and economies of scale by a country's factors of production regardless of 5. Service sector trade where the assets are located. 6. Global growth and economic development GNI is equal to GDP plus income earned from assets abroad minus income paid to foreign assets operating The problems arising from free trade include: domestically. 1. Infant industry argument (new industries may net property income from abroad- the difference struggle to compete with more established foreign between income earned from assets abroad minus rivals) income paid to foreign assets operating domestically. GNI= GDP + net property income from abroad 2. Trade can lead to homogenization (similarities rather than differences to emerge) Global Economy Is the exchange of goods and services integrated 3. Displacement effects (job and income losses of into a huge single global market. workers who cannot withstand import competition) It is essentially a world without borders, occupied by marketing individuals and companies who have joined the geographical world with the intent of conducting research and development and making sales. Neoliberalism and its Discontents Monopsony describes a market situation where a Neoliberalism is most commonly associated with single or small number of dominant buyers have laissez-faire (minimal or no government restrictions on leverage to dictate prices paid to many competing economic activity) economics because it emphasizes suppliers. the value of free market competition. Free markets as the most efficient allocation of Political divisions about whether or not to encourage resources, or increase integration of international markets. Minimal government intervention in economic Income disparities between the affluent and social affairs, people and the impoverished are exacerbated, Commitment to the freedom of trade and and industrialized nations grow in power at the capital. expense of under-capitalized countries Laissez-faire is an economic philosophy or system that Criticisms of neoliberalism advocates minimal government interference or Use of free markets in areas, such as health and regulation of the economy. education is misplaced because by nature these are Some key aspects of laissez-faire include: public services, which are not subject to the same It believes free markets, with minimal taxes profit motivation. and government restrictions on trade and Free market ignores the externalities of health competition, are the most efficient way to and education. Adopting a free market produce goods and services. approach can lead to widening inequality and Under laissez-faire, the government does not under-provision of an institution important for set prices, wages or production quotas. It does long-term investment in the economy. not nationalize industries or redistribute wealth. Monopoly and monopsony power. Individuals and private businesses are free to A broadly neoliberal policy has seen a widening pursue their self-interest through voluntary inequality of both wealth and income in the exchange and specialization in the free market Western world. without government intervention. (several factors, such as skilled workers in a There is a belief that an "invisible hand" will position to command higher wages, but guide individual actions toward maximum low-skilled workers in flexible labour markets benefit for all through the laws of supply and more likely to see stagnant wages) demand. Government involvement in areas like antitrust The global financial crisis laws, public education, labor laws and social Considered to be the turning point in the history of welfare programs is seen as unnecessary and capitalism and of economic thought. harmful market interference. According to the Food and Agriculture Proponents argue laissez-faire leads to greater Organization, as the incomes of the poor are innovation, efficiency and economic growth. falling due to the crisis but the international Critics argue it can result in monopolies, prices of food remain high, the number of inequality and economic instability without undernourished people in the world some regulation. increased by 11 percent in 2009, and for the In practice, most modern economies do not first time, exceeded one billion. (Pereira, 2010) follow a pure laissez-faire model and feature some level of government intervention and The cause of crisis are also moral. regulation of markets. Fraud in the banking system took place So in essence, laissez-faire advocates for causing several banks to fail, minimal or no government restrictions on The turmoil became an economic crisis. economic activity and a purely free market-driven economy. It promotes individualism and private initiative over state involvement. The Financial Crisis of 2007-2008. As of writing, this crisis is considered the most recent Laissez-faire financial collapse in history. Advocates for minimal or no government restrictions The crisis resulted in the collapse of Lehman Brothers on economic activity and a purely free market-driven –one of the biggest banks in the world triggered by the economy. collapse of the housing bubble in the US. It promotes individualism and private initiative (https://www.britannica.com/list/5-of-the-worlds-most over state involvement. -devastating-financial-crises) The idea behind globalization is free-market The Covid-19 Crisis capitalism. The COVID-19 pandemic and resulting economic fallout The more a country opens its economy to free caused significant hardship. In the early months of the trade and competition, the more efficient its crisis, tens of millions of people lost their jobs. economy will be While employment began to rebound within a few months, unemployment remained high throughout Discontents on Neoliberalism 2020. Neoliberalism is the main cause of increasing gap between rich and poor in modern society; Economic Globalization Today This is due to several factors such as giant Economic globalization denotes mobility of people, firms with monopoly power to increase capital, technology, goods and services producer surplus to eliminate competition and internationally. firms with monopsony power to limit wage growth. It shows how integrated countries are in the global economy and how interdependent different countries and regions have become across the world. Other International Economic Institutions Globalization has altered the way we live and earn a 1. United Nations Development Programme livelihood. (UNDP): Manages a “network” of development Trade and travel have been recognized as activities undertaken by the United Nations in significant determinants of the spread of the areas of democratic governance, poverty disease. alleviation, crisis prevention and recovery, The rise in urbanization and the closer energy and the environment, and HIV/AIDS. integration of the world economy have 2. World Trade Organization (WTO): An facilitated global interconnectedness. international organization governing the Globalization has emerged as an essential system of rules for global trade among its mechanism of disease transmission. member nations. It is also involved in dispute settlement and compliance monitoring related Market Integration to international trade (Goldin & Reinert, 2012). Refers to how markets trade with one another. When markets are highly integrated, there are less trade barriers and prices are similar. In case of low integration, prices among these markets fluctuate and there are several barriers in trade. International trade helps the integration of markets because the latter allows price signals to be transmitted from one market to another. The role of International Financial Institutions International financial institutions were founded by groups of countries to stimulate public and private investment and promote economic and social development in developing and transitioning countries. They offer long-term, low interest loans, and grants to finance projects run by government or even the private sector. International Financial Institutions The Bretton Woods Conference was a gathering of world leaders that took place in 1944 in Bretton Woods, New Hampshire, United States, with the aim of placing the international economy on a sound footing after the World War II. The conference resulted in the establishment of the World Bank and the International Monetary Fund. The International Monetary Fund (IMF)is a subscription-based, global financial organization whose purpose is to promote international monetary cooperation and the multilateral system of payments. Engages in four areas of activity: surveillance or monitoring, the dispensing of policy advice, lending, and providing technical assistance. The Five World Bank Group institutions 1. The International Bank for Reconstruction and Development (IBRD) (lends to governments of middle-income and creditworthy low-income countries) 2. The International Development Association (IDA) (interest-freeloans, called credits, to governments of the poorest countries) 3. The International Finance Corporation (IFC) (lends directly to the private sector developing countries) 4. The Multilateral Investment Guarantee Agency (MIGA) (guarantees to investors in developing countries against losses caused by noncommercial risks) 5. The International Centre for Settlement of Investment Disputes (ICSID) (provides international facilities for conciliation and arbitration of investment disputes)