Contemporary World: Globalization PDF

# **ECONOMICS** - a social science that focuses on the production, distribution, and consumption of goods and services, and analyzes the choices that individuals, businesses, governments, and nations make to allocate resources. - Assuming humans have unlimited wants within a world of limited means,...

# **ECONOMICS** - a social science that focuses on the production, distribution, and consumption of goods and services, and analyzes the choices that individuals, businesses, governments, and nations make to allocate resources. - Assuming humans have unlimited wants within a world of limited means, economists analyze how resources are allocated for production, distribution, and consumption. # **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. (IMF, 2008). - Kalakalan ng mga produkto at serbisyo; pamilihan ng mga pananalapi at puhunan; teknolohiya at talastasan; produkto o paggawa. # **GLOBALISASYON VS INTERNALISASYON** - Localization is the adaptation of a particular product or service to one of those markets. - Globalization refers to the processes by which a company brings its business to the rest of the world. - Internationalization is the practice of designing products, services and internal operations to facilitate expansion into international markets. # **PINAGMULAN NG GLOBALISASYON** (International Trading Systems) # **SILK ROAD (SILK ROUTE)** - first global trade route in history - 1,500 years; 130 B.C.E. until 1453 C.E. - 6,437 kilometers (4,000 miles) - It is hard to overstate the importance of the 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. ### An image of a world map. The Silk Road is traced in red across Eurasia, connecting Europe, Persia, Arabia, India, and China. The route is then traced in blue across the seas of the Indian Ocean. ### An image of a map showing the Silk Road. The route is traced in red across China, Persia and other countries. ### An image of a map showing the Silk Road. The route is traced in red across China, Persia and other countries. It shows the location of each country in more detail. # **GALLEON TRADE** - Took place during the age of mercantilism (16th – 18th 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 communication between Spain and its Philippine colony and served as an economic lifeline for the Spaniards in Manila. ### An image of a simple world map. The galleon route between Manila and Acapulco is traced in red. Other cities and countries are labeled. # **INTERNATIONAL MONETARY SYSTEM** - provides the institutional framework for determining the rules and procedures for international payments, determination of exchange rates, and movement 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 a silver standard. # **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 ginagarantiyahan 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. - **ADVANTAGES:** The gold standard prevents inflation as governments and banks are unable to manipulate the money supply (e.g., overissuing money). The gold standard also stabilizes prices and foreign exchange rates. - **DISADVANTAGES:** Under the gold standard, the supply of gold cannot keep pace with its demand, and it is not flexible under trying economic times. Also, mining gold is costly and creates negative environmental externalities. # **"We have gold because we cannot trust governments",** -President Herbert Hoover (1933) # **BRETTON WOODS SYSTEM** - 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 foreign exchange system, preventing competitive devaluations of currencies, and promoting international economic growth. - $35 per ounce - **International Monetary Fund (IMF) -** to monitor exchange rates and identify nations that needed global monetary support. - **World Bank -** to manage funds available for providing assistance to countries that had been physically and financially devastated by World War II. # **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 value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government. - Floating rate system # **FLOATING RATE SYSTEM** - A floating exchange rate is a regime where the currency price of a nation is set by the forex market based on supply and demand relative to other currencies. - Floating exchange rates became more popular after the failure of the gold standard and the Bretton Woods agreement. # **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 a fool-proof way to protect the economy - Creates opportunity for a bubble - Provides risk of inflation # **"We accepted money as the medium by which things are exchanged, not the value for which they are."** # **STATE** - 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 (CIR v. Campos Rueda, GR No. L-13250, October 29, 1971). # **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 the four elements. # **FOUR ELEMENTS OF STATE** 1. People 2. Territory 3. Government 4. Sovereignty # **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. # **TERRITORY** - The definite portion of the Earth where people reside and must be capable of sustaining of its inhabitants. - It is ideal for a state's territory to be large enough to sustain the needs of its inhabitants and must also be small enough for it to be easily administered and defended. - Article I section 1 of the 1987 Philippine Constitution # **NATIONAL TERRITORY** - Terrestrial Domain - Fluvial Domain (Internal or National Water, Territorial Sea, Exclusive Economic Zone, High Seas) - Aerial Domain # **MODES OF ACQUIRING TERRITORY** - Discovery and Occupation - Cession - Accretion - Prescription - Conquest # **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 agent through which the state acts. - Doctrine of Parens Patriae - guardian of the people. # **DIFFERENT KINDS/FORMS OF GOVERNMENT** # **AS TO THE NUMBER OF RULERS** - **Monarchy -** kind of government that has a single ruler that has been referred to as the monarch - **Aristocracy -** the power to govern rests on the hands of the few called aristocrats - **Democracy -** rule of the people # **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 the inherent powers - **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 - **Power of Taxation -** the power in which taxes (proportional contribution paid by the inhabitants of the state) are collected. # **OTHER IMPORTANT COMPONENTS IN INTERSTATE SYSTEM** # **INTERNATIONAL ORGANIZATIONS** - **Global/Universal -** World Bank; United Nations Educational, Scientific, and Cultural Organization (UNESCO) - **Regional -** United Nations (UN); Asia-Pacific Economic Community (APEC); European Union (EU) - **Purposive -** General or multipurpose (EU, UN); Specific (WHO). # **INTERNATIONAL NON-GOVERNMENTAL ORGANIZATIONS** - independent of governments and can be seen as two types: advocacy NGOs, which aim to influence governments with a specific goal, and operational NGOs, which provide services. - Examples of NGO mandates are environmental preservation, human rights promotions or the advancement of women. # **MULTINATIONAL CORPORATIONS** - is a company that has business operations 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 management. # **RELIGIOUS ORGANIZATIONS** ### An image of a pie chart. The different religious groups are labeled and their percentage of the population is shown. # **PRIVATE INDIVIDUALS** - 2000 - George W. Bush - 2001 - Rudolph Giuliani - 2002 - The Whistleblowers - 2003 - The American Soldier - 2004 - George W. Bush - 2005 - Bill Gates, Melinda Gates, & Bono - 2006 - You - 2007 - Vladimir Putin - 2008 - Barack Obama - 2009 - Ben Bernanke - 2010 - Mark Zuckerberg - 2011 - The Protester - 2012 - Barack Obama - 2013 - Pope Francis - 2014 - Ebola Fighters - 2015 - Angela Merkel - 2016 - Donald Trump - 2017 - The Silence Breakers - 2018 - The Guardians and the War on Truth - 2019 - Greta Thunberg - 2020 - Joe Biden, Kamala Harris # **THEORIES IN INTERNATIONAL RELATIONS** # **REALISM** - Popularized by E.H. Carr, Hans Morgenthau, George F. Kenna, and Reinhold Niebuhr. - Inspired from the philosophy of Thucydides, St. Augustine, Niccolo Machiavelli, and Thomas Hobbes - In the discipline of International Relations (IR), realism is a school of thought that emphasizes the competitive and conflictual side of international relations. - The first assumption of realism is that the nation-state (usually abbreviated to 'state') is the principle actor in international relations. Other bodies exist, such as individuals and organisations, but their power is limited. - Second, the state is a unitary actor. National interests, especially in times of war, lead the state to speak and act with one voice. - Third, decision-makers are rational actors in the sense that rational decision-making leads to the pursuit of the national interest. Here, taking actions that would make your state weak or vulnerable would not be rational. - Finally, states live in a context of anarchy - that is, in the absence of anyone being in charge internationally. The often-used analogy of there being 'no one to call' in an international emergency helps to underline this point. # **LIBERALISM** - Proposed by Dante Alighiere in his book "Monarchy" during the 4th century, promoted by US President Woodrow Wilson during the 20th 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' as a way to describe countries with free and fair elections, rule of law and protected civil liberties. - is based on the moral argument that ensuring the right of an individual person to life, liberty and property is the highest goal of government. - Consequently, liberals emphasize the wellbeing of the individual 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 vs. Realism** | Issue | Liberalism | Realism | |---|---|---| | Human Nature | Good, altruistic | Evil, selfish | | Central Problem | War and the establishment of peace | War and security| | Key Actors | States, Individuals, Institutions | States | | Actor Motives | Mutual assistance, collaboration | Power, national security, self-interest | | Interests | Long-term, collective | Short-term, individual | | Nature of IR | Cooperation, community | Anarchy | | Nature of conflict | Irrational | Rational | ### An image of two stick figure cartoons. One is smiling and has a thought bubble that says 'Liberalism'. The other is frowning and his thought bubble says 'Realism' # **INTERDEPENDENCE** - Important role of International Organizations, International Non-Governmental Organizations, Multinational Corporations, Religious Organizations - Pagtutulungan - Diplomacy over military power # **DEPENDENCE** - Based on the the philosophy of Karl Marx - World System Theory - Capitalist System # **GNED 07: The Contemporary World** - Renz Patrick H. Ledesma, Instructor # **GLOBALIZATION** - Refers to the process by which more people across large distances become connected in more different ways. - Ang globalisasyon ay ang mabilis at patuloy na inter-border ng paggalaw ng produkto, serbisyo, kapital, teknolohiya, ideya, impormasyon, kultura, at nasyon. - Kalakalan at Teknolohiya - Ang globalisasyon ay taal o naka-ugat sa bawat isa (Nayan Chanda, 2007). ### An image of a timeline depicting the history of globalization. It is divided into four eras: Ancient, Medieval, Renaissance, and Modern # **CONCEPTS OF GLOBALIZATION** - **TRANSFERENCE** - pagpapalitan o exchange ng mga bagay sa pagitan ng dalawang established units - **TRANSFORMATION** - ito ay nakababago sa buong sistema. Naapektuhan ang Kalayaan ng isang bansa na umaksyon para sa sarili nya. - **TRANSCENDENCE** - implies exchange across existing unit boundaries and between units and system, but it still presupposes that this system as well as the units remain identical with themselves throughout the globalizing process. # **ASPECTS OF GLOBALIZATION** | | | | |---|---|---| | **POLITICAL** | **CULTURAL** | **SOCIAL** | | Formation of global policy and cooperation | Unification of norms, principles, and values | Unification of social standard of living | | **ECONOMICAL** | **ECOLOGICAL** | **TECHNOLOGICAL** | | Strengthening of the economic integration and interdependence | Degradation of the environment on a planetary scale | the cross-cultural development and exchange of technology. The speed with which culture is diffused has changed as a result of technological advances. | # **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 network of states, societies and international governmental 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. # **Isyu** - tuwiran nitong binago, binabago, at hinahamon ang pamumuhay at mga perennial institutions na matagal nang naitatag. # **"Globalization is incredibly efficient but also so far incredibly unjust"** -Pascal Lamy