Globalization: Definitions, Importance, and Impacts PDF

MODULE IN GEC 3 (THE CONTEMPORARY WORLD) CHAPTER 1: GLOBALIZATION: DEFINITIONS, IMPORTANCE AND ITS IMPACTS/EFFECTS, METAPHORS AND FORMS Chapter Introduction The Contemporary World is an ever changing mix of...

MODULE IN GEC 3 (THE CONTEMPORARY WORLD) CHAPTER 1: GLOBALIZATION: DEFINITIONS, IMPORTANCE AND ITS IMPACTS/EFFECTS, METAPHORS AND FORMS Chapter Introduction The Contemporary World is an ever changing mix of social and political changes. Challenges of the 21st century includes the emerging technologies, health care, overpopulation, climate change, poverty, illiteracy, disease and migration. In this chapter, the different definitions of Globalization, its importance will be discussed. We all know that globalization is not just a simple topic that we can explained it in one sentence. In fact it is a broad topic which are also interrelated on the different sectors of the society. The term globalization is derived from the word “globalize” which refers to the emergence of an international network of economic systems. Actually, most globalization scholars viewed this concept as a primarily an economic process usually referring to the integration of the national markets to a wider global market signified by the increased free trade. However, anti-globalist groups believed that globalization negatively affect that force poorer countries of the world to do whatever the big developed countries are dictated them to do. Another viewpoint is that developed countries, including Canada, are the ones who may lose out because they are involved in outsourcing many of the manufacturing jobs that used to be done by their own citizens. Thus, in this chapter these topics will be discussed. Value/Thrusts Integration Concern for others; cooperation Lesson 1 - GLOBALIZATION: DEFINITIONS, IMPORTANCE AND ITS ADVANTAGES/DISADVANTAGES; METAPHORS, NATURE AND FORMS Introduction: 1 | GEC 3 (The Contemporary World)  In this chapter, different definitions of globalization will be discussed which reveals a variety of perspectives. It is further said that globalization is moving towards a borderless world that we can explore different countries without having dangers such as travelling abroad. Aside from the benefits globalization has also a negative results that brings not only on the economic aspect, but also cultural, political, ecological, and military. In addition, metaphors and forms of globalization will also be discussed in this chapter. Its liquidity and solidity as well as its forms: economic, political, cultural, environmental, military, and criminal globalizations. Intended Outcome/Learning Objectives: At the end of the lesson the students will be able to: 1. Write a personal definition of globalization based on a concept map 2. Discuss the different definition of globalization cited by different authors. 3. Identify the importance and impacts of Globalization as well as its metaphors and forms. Stimulating Learning (Motivation) 1. Why do we need to study globalization? 2. Do you have any idea of what globalization is? 3. Does globalization mean that all countries of the world are becoming the same? 4. Does it mean the integration of economic, political, and cultural systems around the world? 5. Does it mean that individual countries will not be able to make business and trade decisions on their own but will have to consult other countries? 6. If these are the realities of globalization, what kinds of impacts will it have on the way we live? Is globalization good or bad? Is it beneficial or detrimental? Inculcating Concepts (Input/Lesson Proper) DEFINING GLOBALIZATION: THERE ARE SEVERAL DEFINITIONS. 2 | GEC 3 (The Contemporary World) o Much has changed since time immemorial; “Globalization is a very important change, if not, “the most important” (Bauman, 2013). o The omnipresence of globalization we refer it as “global age” (Albrow, 1996). The presence of internet by simply browsing google as well as mass media allows us for connecting people, communities, and countries all over the world. o According to The G-World, Globalization first used in 1959; the noun appears in the Oxford English dictionary in 1962; but three decades passed before GLOBALIZATION was developed in social sciences as a paradigm. And it was in 1992 through Roland Robertson that Globalization is applied to almost everything. o Anthony Giddens defined “Globalization as a concept refers both to the compression of the world and the intensification of the consciousness of the world as a whole.” o Roland Robertson defined “Globalization as a concept refers to both the compression of the world and the intensification of consciousness of the world as a whole.” The key dynamics at play here are global interconnectedness and global consciousness. o David Held defined “Globalization may be thought of as a process … which embodies a transformation in the spatial organization of social relations and transactions … generating transcontinental or interregional flows and networks of activity, interaction, and the exercise of power.” o Manfred Steger defined “Globalization as The expansion and intensification of social relations and consciousness across world-time and across world-space.”  Expansion refers to “both the creation of new social networks and the multiplication of existing connections that cut across traditional political, economic, cultural, and geographical boundaries.  Intensification refers to the expansion, stretching, and acceleration of these networks. Not only are global connections multiply but they are also becoming more closely-knit and expanding their reach. o “Globalization means the onset of the borderless world (Ohmae 1992).” This is an example of a broad and inclusive type of definition because it includes a variety of issues that deal with overcoming traditional boundaries. o According to Robert Cox, “the characteristics of Globalization trend include the internationalizing of production, the new international division of labor, new migratory 3 | GEC 3 (The Contemporary World)  movements from North to South, the new competitive environment that accelerate these processes, and the internationalizing of the state…making states into the agencies of the globalizing world.”(cited in RAWOO Netherlands Development Assistance Council,2000.) o George Ritzer defined Globalization as “an increasing liquidity and the growing multi- directional flows of people, objects, places and information as well as the structures they encounter and create that are barriers to, or expedite those flows.” o In General…..Over-all, globalization is a concept that is not easy to define, because in reality, it has a shifting nature.  It is complex, multi-faceted, and can be influenced by the people who define it;  Issues and concerns have a wide-range –from individual to society, from small communities to nation and states, and from the benefits we can gain from it to the cost it could carry.  Globalization involves twin processes: the physical process of interconnectedness, or ‘compression’, which implies that the world is getting smaller. o Arjun Appadurai For anthropologist Arjun Appadurai, different kinds of globalization occur on multiple and intersecting dimensions of integration that he calls scapes. 1. Ethnoscape refers to the global movement of people 2. Mediascape is about the flow of culture 3. Technoscape refers to the circulation of mechanical goods and software 4. Financescape denotes the global circulation of money 5. Ideoscape is the realm where political ideas move around. Appadurai’s argument are simple that there are multiple globalizations that it is divided into 5 SCAPES. IMPORTANCE OF GLOBALIZATION Globalization is about the interconnectedness of people and businesses across the world that eventually leads to global cultural, political, and economic integration. Due to the increased demand in high tech industry around the world, business and industry have potential for huge profits working globally. 4 | GEC 3 (The Contemporary World) ADVANTAGES/DISADVATAGES OF GLOBALIZATION ADVANTAGES OF GLOBALIZATION: 1. Peaceful Relations – most of the countries has resorted to trade relations with each other in order to boost their economy, leaving behind any bitter past experiences if any. 2. Employment - considered as the most crucial advantages, globalization has led to the generation of numerous employment opportunities. Companies are moving toward the developing countries to acquire labour force. 3. Education - a very critical advantage that aided the population is the spread of education. With numerous educational institutions around the globe, one can move out from home country for better opportunities elsewhere. 4. Product quality – the product quality has been enhanced so as to retain the customers. Today the customers may compromise with the price range but not in the quality of the product. Poor or low quality can adversely affect consumers’ satisfaction. 5. Cheaper prices – globalization has brought in fierce competition in the market. 6. Communication – every single information is accessible from almost all corners of the world. Circulation of information is already a tedious task, and can happen in seconds. The internet has significantly affected the global economy, thereby providing direct access on the information of the product. 7. Transportation – considered as the wheel of any business organization, connectivity to the various parts of the world is no more a serious problem. Today with various mode of transportation available, one can conveniently deliver the products to a customer located at any part of the world. 8. GDP increase – Gross Domestic Product, commonly known as GDP, is the money value of the final goods and services produced within the domestic territory of the country on an accounting year. 9. Free Trade – Free Trade is the policy in which a country does not levy taxes, duties, subsidies, or quota on the export/import of goods or services from other countries. There are countries which have resolved to free trade in specific regions. This allows consumers to buy goods and services, comparatively at a lower prices. 5 | GEC 3 (The Contemporary World)  10. Travel and Tourism – globalization has promoted tourism to great heights. International trade among countries also help in the increase on the number of tourists that visit different places of the world. 11. External Borrowing – with the help of globalization, there is opportunity for the corporation, national, and sub-national borrowers to have better access to external finance, with facilities such as external commercial borrowing and syndicated loans. DISADVANTAGES OF GLOBALIZATION 1. Health issues – Globalization has given rise to more health risks and present new threats and challenges for epidemics. The dawn of HIV/AIDS. Having its origin in the wilderness of Africa, the virus spread like wildfire throughout the globe in no time. Food items are also transported to various countries, and this is a matter of concern, in of perishable items. 2. Loss of culture – with large number of people moving in and out of the country, the culture takes a backseat. People may adopt to the culture of the resident country. They tend to follow the foreign culture more, forgetting their own roots. This can give rise to cultural conflict. 3. Uneven wealth distribution - it is said that rich are getting richer, while the poor are getting poorer. In the real sense, globalization has not even been able to reduce poverty. 4. Environmental Degradation – the industrial revolution has changed the outlook of the economy. Industries are using natural resources by means of mining, drilling, etc. which puts a burden on environment. 5. Disparity – though globalization has opened new avenues like wider markets and employment, there are still disparity that exist in the development of the economies. Structural unemployment owes to the disparity created. Developed countries are moving their factories to foreign countries where labour is cheaply available. 6. Conflicts – it has given rise to terrorism and other forms of violence. Such acts did not only cause the loss of human life but also huge economic losses. 7. Cut-Throat Competition – opening the doors of international trade has given birth to intense competition. This has affected the global markets dramatically. The local players 6 | GEC 3 (The Contemporary World)  thereby suffer huge losses as they lack the potential to advertise or export their products on a large scale. Therefore, the domestic market shrinks. METAPHORS OF GLOBALIZATION The epochs that preceded today’s globalization paved way for people, things, information, and places to harden over time. Consequently, they have limited mobility (Ritzer, 2015). Their social relationships and objects remained where they were created. 1. Solidity - refers to the barriers that prevent or make difficult the movement of things; Solids can either be natural or man-made (i.e. natural solids are land forms and bodies of water; man-made barriers include the Great Wall of China and the Berlin Wall; an imaginary line such as nine-dash line used by China in their claim of South China Sea- is an example of modern man-made solid. 2. Liquidity - as a state of matter, takes the shape of its container; are not fixed; it refer to increasing ease of movement of people, things, information, and places in the contemporary world; o Zygmunt Bauman’s said about liquidity of globalization, that today’s liquid phenomena change quickly and their aspects, spatial and temporal, are in continuous fluctuation. This means that space and time are crucial elements of globalization (i.e. in global finance changes in the stock market are a matter of seconds; Their movement is difficult to stop – i.e. videos uploaded on You Tube or Facebook are unstoppable once they are viral (internet sensations become famous globally); o Finally, the forces (the liquid ones) made political boundaries to the flow of people and things (Cartier, 2001). This brings us to what Ritzer (2015, p.6) regarded globalization as the most important liquid, “it tends to melt whatever stands in its path (especially solid).” The clearest example is the decline, if not death of the nation-state. Flows o Liquid flows of phenomena – flows are the movement of people, things, places, and information brought by growing porosity of global limitations (Ritzer, 2015). i.e. think of a different foreign cuisines being patronized and consumed by Filipinos. Aside from local 7 | GEC 3 (The Contemporary World)  dishes, many of us are fond of eating sushi, ramen, hamburger and French fries – foods introduced by foreign cultures. NATURES OF GLOBALIZATION 1. LIBERALIZATION – it stands for the freedom of the entrepreneurs to establish any industry or trade or business venture, within their own countries or abroad. 2. FREE TRADE – it stands for the free flow of trade relations among nations. Each state grants MFN (most favoured nation) status to other states and keeps its business away from excessive and hard regulatory and protective regimes. 3. GLOBALIZATION OF ECONOMIC ACTIVITY – Economic activities are to be governed both by the domestic market and also the world market. It stand for the process of integrating the domestic economy to the world economies. 4. LIBERALIZATION OF IMPORT-EXPORT SYSTEM – it stands for liberating the export- import activity and securing a free flow of goods and services across borders. 5. PRIVATIZATION – keeping the state away from ownership of means of production and distribution letting the free flow of industrial, trade and economic activity across borders. 6. INCREASED COLLABORATION – encouraging the process of collaborations among the entrepreneurs with a view to secure rapid modernization, development and technological advancement. 7. ECONOMIC REFORMS – encouraging fiscal and financial reforms with a view to give strength to free world trade, free enterprise and market forces. 8. DEREGULARIZATION – this refers to the lifting of government’s control or regulating powers over the trade and operation of public utilities or goods, as in the case of power and oil in the Philippines. Globalization accepts and advocates the value of free world trade, freedom of access to world markets and a free flow of investments across borders. It stands for integration and democratization of the worlds’ culture, economy, and infrastructure through global investments. 8 | GEC 3 (The Contemporary World) ASPECTS OF GLOBALIZATION (Forms) THESE ASPECTS ARE ALL INTERCONNECTED! 1. Economic Globalization may be defined as the intercontinental exchange of products, services, and labor. Multinational corporations have been instrumental in globalization of both production and distribution networks. o It refers to the increasing interdependence of the world economies as a result of a growing scale of cross-border trade of commodities and services, flow of international capital and wide and rapid spread of technologies (Shangquan, 2000). 2. Political globalization is the proliferation of international and regional organizations composed of states and the spread of non-state political actors. o Through globalization, political issues such as rights of women and children are now currently discussed in which this aspect promote globally certain values such as equality, human rights, justice democracy, and moral values (Gazleh, 2001). 3. Military globalization is characterized by extensive as well as intensive networks of military force that operate internationally. o According to David Held, “military globalization is the process which embodies the growing extensity and intensity of military relations among the political units of the world system. It reflects both the expanding network of worldwide military ties and relations, as well as the impact of key military technological innovations (from steamships to satellites) which over time, have reconstituted them into a single geostrategic space.” Robert Keohane and Joseph Nye, “military globalization entails long distance networks interdependence in which force, and the threat or promise of force are employed.” Example: Global alliances become clear during war time; US alliance with Britain in wars against Afghanistan and Iraq; North Korea and its nuclear weapons - North Korea suggested on April 24, 2017 it will continue its nuclear weapons tests, saying it will bolster its nuclear force "to the maximum" in a "consecutive and successive way at any moment" in the face of what it calls U.S. aggression and hysteria; US is the #1 exporter of weapons globally and the last on the list of exporters of non-military aid to the developing world. 4. Cultural globalization refers to the spread of one culture across national borders. 9 | GEC 3 (The Contemporary World)  o It is the transmission of ideas, meanings, and values around the world in such a way to extend and intensify social relations. This process marked by the consumption of cultures that has been diffused by the internet, popular culture media, and international travel. o However, the downside of this is, some cultures that are exclusive on a certain country are slowly vanishing. 5. Environmental globalization refers to the interdependence of countries to work together to solve environmental problems. o The effects of globalization to the environment are still not completely identified, though some studies suggest that process has many consequences in the environment. 6. Criminal globalization is the intercontinental spread of global crime and its impact on governments and individuals.Globalization has internationalized crimes such as drug trafficking, and the trafficking of women and children have come much more difficult to control because of their international character. Not only crimes are globalized, but also diseases (Muzaffar, 1998). i.e. Criminal case vs Duterte filed before International Criminal Court. Lawyer Jude Sabio shows the stamped complaint he filed before the International Criminal Court in The Hague, Netherlands on Monday, April 24, 2017. Remember what Kofi Annan, former UN Secretary-General: said: ACTIVITY/IES. Let the student research and answer the following: A. Activity 1: The World Made Closer 1.1. Is globalization a new or an old phenomenon? 10 | GEC 3 (The Contemporary World)  1.2. Is globalization good or bad? 1.3. Is globalization really “global” or inclusive of all people? Using/Applying Knowledge (application/integration) Activity 1. In this activity, you are to see the actual application of globalization on the different aspects of daily life such as politics, music, sports, film, celebrity, and disaster. 1. Answer the following: a. Enumerate at least 3 of the most recent songs you have listened. Where did they originate? Identify the nationality of the writer and/ or artist for each music. b. What gadget or devices do you usually use to listen to music? c. Where are these gadgets or devices made? Where is the company based? d. How did you access the music? Did you purchase them on line or listen them through YouTube, Spotify, and other music channels? Activity 2. 1. Evaluate the over-all impact of globalization in terms of socio-economic aspect in our country. Write your answers on the box below: EFFECTS OF GLOBALIZATION IN THE PHILIPPINES BENEFICIAL HARMFUL 2. Based on what we have discussed on the concept of globalization. Make an essay on your understanding of the term globalization. Write it in a piece of paper. Evaluating Understanding (Assessment) Answer in a one whole sheet of paper: Quiz/Assessment: I. TRUE or FALSE. Write True if the statement is correct and False if otherwise. 11 | GEC 3 (The Contemporary World) __________1. Globalization is reality and it is changing as human society develops. __________2. Zygmunt Bauman regarded globalization as the most important liquid for it tends to melt whatever stands in its path and one clearest example is the decline, if not death of the nation-state. __________3. According to the G-World, “Globalization was first used in 1959, appear as noun in the Oxford English dictionary in 1962; but three decades passed when GLOBALIZATION was developed in social sciences as a paradigm in 1990. __________4. Globalization open the doors of international trade that has given birth to intense competition which we called it, cut-throat competition. __________5. Globalization is seen as negative for it brings regression, colonialism, and destabilization. II. MULTIPLE CHOICE. Choose the correct letter of your choice: ___6. He was an Anthropologist believing that different kinds of globalization occur on multiple and intersecting dimensions of integration that he calls “scapes.” A. George Ritzer C. Arjun Appadurai B. Zygmunt Bauman D. Roland Robertson ___7. He define “military globalization as the process which embodies the growing extensity and intensity of military relations among the political units of the world system. A. Anthony Giddens C. Joseph Nye B. David Held D. Manfred Steger ___8. According to him, “Globalization as a concept refers both to the compression of the world and the intensification of the consciousness of the world as a whole.” A. Anthony Giddens C. Joseph Nye B. David Held D. Manfred Steger ___9. A nature of globalization that refers to the lifting of government’s control or regulating powers over the trade and operation of public utilities or goods, as in the case of power and oil in the Philippines. A. Liberalization C. Privatization B. Deregularization D. Free Trade 12 | GEC 3 (The Contemporary World) ___10. He define “globalization as an expansion and intensification of social relations and consciousness across world-time and across world-space.” A. Robert Keohane C. Roland Robertson B. David Held D. Manfred Steger Upgrading Competence and Expanding Insights (enrichment phase) Make a reflection paper on the issue, Globalization. Is it good or bad? Is it beneficial or detrimental? How does it affect in your daily life? Reference to/Reflection on Value/Thrusts Integration: 1. Lisandro E. Claudio and Patricio N. Abinales. The Contemporary World. C and E Publishing, Inc. 2018, 839 EDSA, South Triangle, Quezon City. 2. Martinez, et.al. The Contemporary World. Mindshapers Co. Inc. Intramuros, Mtro Manila 3. Prince Kennex Reguyal Aldama. The Contemporary World, 1st ed. Rex Book Store. Manila, Philippines.2018. CHAPTER 2: GLOBALIZATION: HISTORY, THEORIES AND IDEOLOGIES Chapter Introduction There are many established definitions and issues of defining globalization that we can use to understand easily its concept. This chapter will give a glimpse on the origins and history, 13 | GEC 3 (The Contemporary World) as well as important theories and ideologies on Globalization. It is also helpful that theories had been asserted for us to see globalization as a process that increases homogeneity and heterogeneity. Value/Thrusts Integration Integration and cooperation Lesson 2 - GLOBALIZATION: HISTORY, THEORIES AND IDEOLOGIES Introduction: Globalization is often referred to as a contemporary or modern phenomenon that need to be analyzed historically, its origin, theories, and ideologies in order to have a better understanding of the concept and discussion surrounding. Thus, this chapter will focus on the origin and history, as well as the different theories and ideologies behind the development of the concept of Globalization. Intended Outcome/Learning Objectives: At the end of the lesson the students will be able to: 1. Come up with a time line of the history of Globalization 2. Identify the different theories and ideologies of Globalization Stimulating Learning (Motivation) 1. Do you have any idea on how globalization started? 2. What are the different theories and ideologies in the study of globalization? Inculcating Concepts (Input/Lesson Proper) A. ORIGINS AND HISTORY OF GLOBALIZATION HARDWIRED 14 | GEC 3 (The Contemporary World)  According to Nayan Chanda (2007), “it is because of our basic need to make our lives better that made globalization possible”; he further said that commerce, religion, politics, and warfare are the “urges’ of people toward better life which are respectively connected to four aspects of globalization and they can be traced throughout history: trade, missionary work, adventures and conquest. CYCLES For some, globalization is a long-term cyclical process and thus, finding its origin will be a daunting task; there is also a notion to suspect that this point of globalization disappear and reappear. PERIODS OF GLOBALIZATION There are five waves of globalization; these are also called “waves” and each has its own origin. 1. The first wave of globalization is as old as human civilization. For more than five thousand years human beings from different places have interacted, mostly through trade, migration, and conquest. 2. The second wave of globalization is closely associated with the Western European conquest of Asia, Latin America, and Africa and the spread of capitalism to these areas. 3. The third wave of globalization, which began around 1870 and declined around 1914, was marked by breakthroughs in technological development, the global production of primary commodities as well as manufactured products, and mass migration. 4. The fourth wave of globalization, from 1945 to 1980, was spurred by the retreat of nationalism and protectionism and the strengthening of internationalism and global cooperation, led by the United States. The removal of trade barriers was selective, but institutions – such as the World Bank, the International Monetary Fund, and the General Agreement of Tariff and Trade (GATT) – were formed to encourage global trade and development. 5. The fifth wave of globalization, which is the current period, is characterized by unprecedented interdependence among nations and the explosive growth of powerful actors. 15 | GEC 3 (The Contemporary World) B. THEORIES OF GLOBALIZATION Globalization is not a single concept …. Globalization is a concept that has been defined variously over the years, with some connotations referring to progress, development and stability, integration and cooperation, and others referring to regression, colonialism, and destabilization. In 1995, Martin Khor, President of the Third World Network in Malaysia, referred to globalization as colonization. THEORIES OF GLOBALIZATION 1. THE WORLD-SYSTEM THEORY BY IMMANUEL WALLERSTEIN In the 1950s, the dominant theory was modernization theory; its problem was that some countries were not developing/ modernizing as predicted.  Evidence did not fit the theory  hence... World System Theory was developed out of attempt to explain the failure of certain states to develop.  Looking at Latin America, their economies could not compete, global capitalism forced certain countries into under-development  Trade is asymmetrical  Poor countries are dependent on rich states Immanuel Wallerstein (The Modern World System, 1976) argued that “Globalization represents the triumph of a capitalist world economy tied together by a global division of labor.” A world- system is a "multicultural territorial division of labor in which the production and exchange of basic goods and raw materials is necessary for the everyday life of its inhabitants." KEY STRUCTURE OF THE CAPITALIST WORLD-SYSTEM The division of the world into three great regions, or geographically based and hierarchically organized tiers: 1. The Core - is composed of the highly industrialized countries having the most advance level of technology and dominate the world’s banking and financial institutions. 16 | GEC 3 (The Contemporary World)  2. The Periphery – is composed of economically depressed countries, mostly from Asia, Africa and Latin America. These countries provide the core states and semi-peripheral areas with cheap raw materials and labor. 3. The Semi-Periphery - act as the intermediary or the “go-in between” are relatively less developed than the core states but more developed than the peripheral areas. Their industries and banking systems are fairly developed but they still depend on the core states for capital and technology. The powerful and wealthy "core" societies dominate and exploit weak and poor peripheral societies. There is unequal exchange of goods and services and capital accumulation. States are used by class forces to pursue their interest, in the case of core countries. The idea that governments and international institutions can make the system ‘fair’ is an illusion (because they always reflect interests of capitalists). In addition, "GLOBALIZATION" refers to some asserted new, chronologically recent, process in which states are said to be no longer primary units of decision-making, but are now, only now, finding themselves located in a structure in which something called the "world market," a somewhat mystical and surely reified entity, dictates the rule." 2. THEORIES OF GLOBAL CAPITALISM 2.1. THE TRANSNATIONAL PRACTICES (TNP) by LESLIE SKLAIR  rejects both state-centrism (realism) and globalism (the end of the state)  there is existence of a global system TRANSNATIONAL PRACTICES (TNP), practices that cross state boundaries but do not originate with state agencies or actors. Transnational practices (TNPs) which originate with non- state actors and cross-state borders. TNPs at three levels (Leslie Sklair):  the economic, whose agent is transnational capital;  the political, whose agent is a transnational capitalist Class (TCC);  the cultural-ideological, whose agent is cultural elites. 17 | GEC 3 (The Contemporary World) His theory involves the idea of the TCC as a new class that brings together several social groups who see their own interests in an expanding global capitalist system:  the executives of transnational corporations;  globalizing bureaucrats, politicians, and professionals’, and  consumerist elites’ in the media and the commercial sector (Sklair, 2000). 3. GLOBAL CAPITALISM BY WILLIAM ROBINSON World Economy Each country developed a national economy that was linked to others through trade and finances in an integrated international market. Global Economy Globalization of the production process itself, which breaks down and functionally integrates what were previously national circuits into new global circuits of production and accumulation. Transnational class formation takes place around these globalized circuits. Like Sklair, Robinson analyzes the rise of a Transnational Capitalist Class (TCC) as the class group that manages these globalized circuits that led to the birth of the Emergent transnational state (TNS) apparatus (William Robinson). However, in distinction to Sklair, for whom state structures play no role in the global system, Robinson theorizes an emergent transnational state (TNS) apparatus. This Transnational State (TNS) is a loose network comprised of supranational political and economic institutions together with national state apparatuses that have been penetrated and transformed by transnational forces. 4. THE NETWORK SOCIETY BY MANUEL CASTELLS A network society is a society whose social structure is made of networks powered by microelectronics-based information and communication technologies. This new economy is: 18 | GEC 3 (The Contemporary World) 1. Informational, knowledge-based; 2. Global, in that production is organized on a global scale; and 3. Networked, in that productivity is generated through global networks of interaction. The Internet constructs a new symbolic environment, global in its reach, which makes “virtuality a reality”. Castells argues that globalization is a network of production, culture, and power that is constantly shaped by advances in technology, which range from communications technologies to genetic engineering. Globalization represents a new ‘age of information’.  The development of new information technology (IT), in particular, computers and the Internet, representing a new technological paradigm and leading to a new ‘mode of development’ that Castells terms ‘informationalism’. Informationalism refers to a technological paradigm that replaces and subsumes the previous paradigm of industrialism (Castells 1996). From metallurgy to transportation, industrialism was marked by a revolution in materials engineering triggered by the Industrial Revolution. Moreover, Informationalism is connected with the information revolution that begins after World War II, covering developments associated with computer science and its various expressions in electronics and telecommunication networks. DISTINCT FEATURES OF THE NEW SYMBOLIC ENVIRONMENT 1. SPACE OF FLOWS, in which informational flows bring physical spaces closer through networks 2. TIMELESS TIME in which technology is able to manipulate the natural sequence of events, and 3. REAL VIRTUALITY based on a hypertext reality and global interconnection which bends space and time relations. CENTRAL THEME (Global Network Society) The division of the world into those areas and segments of population 19 | GEC 3 (The Contemporary World)   switched on to the new technological system  and those switched off or marginalized digital divide For Castells, the advancement of the Information Age does not necessarily mean that the world has become flat; rather, with technological advance, he argues, come new global forms of exclusion and inclusion, fragmentation and integration. 5. THEORIES OF SPACE, PLACE AND GLOBALIZATION 5.1. TIME-SPACE DISTANCIATION BY ANTHONY GIDDENS Giddens defines time-space distanciation as ‘the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa’ – social relations are ‘lifted out’ from local contexts of interaction and restructured across time and space (1990: 64). GLOBAL RISK SOCIETY (Anthony Giddens) In Runaway World, Giddens provocatively argues that globalization has led to the creation of a “global risk society.”  Human social and economic activities, especially in modernity, produce various risks such as pollution, crime, new illnesses, food shortages, market crashes, wars, etc., and societies have become more responsible for managing these risks that their activities intentionally or, more often than not, unintentionally produce. 5.2. ‘TIME-SPACE COMPRESSION’ BY DAVID HARVEY  Time-space compression is the process whereby time is reorganized in such a way as to reduce the constraints of space, and vice-versa.  Time–space compression refers to the way the acceleration of economic activities leads to the destruction of spatial barriers and distances. 6. THEORIES OF GLOBAL CULTURE BY TOMLINSON 1999; NEDERVEEN PIETERSE 2004 There are three main bodies of theory regarding the effects of globalization on local culture: 20 | GEC 3 (The Contemporary World)  1. homogenization, 2. hybridization and 3. heterogeneity or polarization. 1. Homogenization Theory Homogenization is the name given to the process whereby globalization causes one culture to consume another. Moreover, Homogenization theories see a global cultural convergence and would tend to highlight the rise of world beat, world cuisines, world tourism, uniform consumption patterns and cosmopolitanism (Appadurai). 2. Hybridization Hybridization occurs when people mix cultural forms, genres or styles to create something new. 3. Heterogeneity or polarization Heterogeneity approaches see continued cultural difference and highlight local cultural autonomy, cultural resistance to homogenization, cultural clashes Burundi drummers and dancers and polarization, and distinct subjective experiences in New Zealand of globalization. 7. THE GLOBAL VILLAGE by Marshall McLuhan His insights were revolutionary at the time, and fundamentally changed how everyone has thought about media, technology, and communications ever since. McLuhan chose the insightful phrase "global village" to highlight his observation that an electronic nervous system (the media) was rapidly integrating the planet -- events in one part of 21 | GEC 3 (The Contemporary World) the world could be experienced from other parts in real-time, which is what human experience was like when we lived in small villages. The late Marshall McLuhan, a media and communication theorist, coined the term “global village” in 1964 to describe the phenomenon of the world’s culture shrinking and expanding at the same time due to pervasive technological advances that allow for instantaneous sharing of culture (Johnson 192). Moreover, McLuhan's second best known insight is summarized in the expression is "the medium is the message", which means that the qualities of a medium have as much effect as the information it transmits. 8. MCDONALDIZATION THEORY BY GEORGE RITZER McDonaldization theory is defined as “the process whereby the principles of the fast-food restaurant are coming to dominate more and more sectors of American society and the world” (Ritzer, 1993:19). The Four Main Dimensions of McDonaldization 1. Efficiency - The optimum method of completing a task. The rational determination of the best mode of production. Individuality is not allowed. 2. Calculability - Assessment of outcomes based on quantifiable rather than subjective criteria. In other words, quantity over quality. They sell the Big Mac, not the Good Mac. 3. Predictability - The production process is organized to guarantee uniformity of product and standardized outcomes. All shopping malls begin to look the same and all highway exits have the same assortment of businesses. 4. Control - The substitution of more predictable non-human labor for human labor, either through automation or the deskilling of the work force. 9. GLOCALIZATION BY ROLAND ROBERTSON Roland Robertson’s concept of glocalization suggests that the global is only manifest in the local. GLOCALIZATION means that ideas about home, locality and community have been extensively spread around the world in recent years, so that the local has been globalized, and the stress upon the significance of the local or the communal can be viewed as one ingredient 22 | GEC 3 (The Contemporary World) of the overall globalization process (Robertson 1995). In addition, “Glocalization” is a more specific concept coined by Roland Robertson in 1992. To him, as global forces interact with local factors or a specific geographic area, the glocal is being produced. In political institutions, Benjamin Barber provided the alternate of McWorld – the “jihad”, it refers to the political groups engaged in an intensification of nationalism and that leads to greater political heterogeneity throughout the world. 10. SCAPES by ARJUN APPADURAI “Disjuncture and Difference in the Global Cultural Economy” Arjun Appadurai (1990) Landscapes or Dimensions of Cultural Flows 1. Mediascapes are about the flows of image and communication. 2. Ethnoscapes are concerned with the flows of individuals around the world. 3. Ideoscapes deal with exchanges of ideas and ideologies. 4. Technoscapes refer to flows of technology and skills to create linkages between organizations around the world. 5. Financescapes relate to the interactions associated with money and capital. Appadaurai uses the suffix SCAPE to connote the idea that these processes have fluid, irregular, variable shapes end C. IDEOLOGIES OF GLOBALIZATION by Manfred B. Steger Since its earliest appearance in the 1960s, ‘globalization’ has been used in both popular and academic literature to describe a wide variety of phenomena, including a process, a condition, a system, a force, and an age. Given the different meanings of these concepts, their indiscriminate usage invites confusion. 23 | GEC 3 (The Contemporary World) GLOBALITY The term globality signifies a future social condition characterized by thick economic, political, and cultural interconnections and global flows that make currently existing political borders and economic barriers irrelevant. It should not be assumed that ‘globality’ refers to a determinate endpoint that precludes any further development. Rather, this concept points to a particular social condition destined to give way to new, qualitatively distinct, constellations. What is an Ideology?  set of ideas  committed to attain an ideal state  through an organized political action Components of Ideology Components Examples 1. Values Communism: collectivist attitudes (Common good) Democracy: individual freedom 2. Vision of an Communism: withering of the state Ideal state Democracy: power to the masses 3. Conceptions of Communism: Marxist, i.e., Capitalists exploit workers Human Nature Democracy: Liberalist,i.e., Man is born free, endowed with potentials 4. Strategy for Communism: Communist Party control of public and private action affairs Democracy: Government interference in private affairs must be kept to an absolute minimum. 5. Political Tactics Communism: Violent overthrow of Capitalism Democracy: Popular political participation (Republicanism) “Theories of Globalization” by Manfred B. Steger Main Issues of the Article 24 | GEC 3 (The Contemporary World)  Is Globalization an Ideology or just a Process or Condition? Is “Globalism” a mature Ideology? Criteria for a mature Ideology by Michael Freeden Degree of: 1. Uniqueness and morphological sophistication 2. Ability to produce effective context-bound responsiveness to a broad range of political issues 3. Conceptual decontestation chain ***According to Steger, Globalization has reached maturity as an Ideology (globalism is a widespread belief among powerful people that the global integration of economic markets is beneficial for everyone, since it spread freedom and democracy across the world.) as seen in its 6 Core Claims. THE SIX (6) CORE CLAIMS (IDEOLOGIES OF GLOBALIZATION) Claim 1: “Globalization” is about “liberalization” and “global integration of Markets”.  “Liberalization is liberation of markets from state control.” The only role of government is to get out of the way - to remove barriers to the free flow of goods, services and capital. (Neo-liberalism)  “Integration of markets” is opening the country's economy to free trade and competition (shrinking in time and space -uniqueness of globalism regardless of the political and cultural preferences of the local citizens. (Globalization vs Indigenization?) Claim 2: Globalization is inevitable and irreversible  Determinist terms of globalization: inevitable, inexorable, irresistible, irreversible  ‘Globalization is inevitable and inexorable and it is accelerating.... Globalization is happening, it’s going to happen. It does not matter whether you like it or not, it’s happening, it’s going to happen’.  Frederick W. Smith, chairman and CEO of FedEx Corporation  “...it is the reality of the modern world” (Manny Villar)  Globalization (global free market) is “providential” (a natural force for human survival) 25 | GEC 3 (The Contemporary World) Political implications:  Political leaders simply carry out what is demanded by Globalization Claim 3: Nobody is in charge of Globalization Globalization is ‘self-regulating market’; “Globalists” do not dictate.  in the sense of imposing their own political agenda on people Globalization is not controlled by any individual, government or institution Claim 4: Globalization benefits everyone (...in the long run) 1996 G-7 Summit “Economic growth and progress in today’s interdependent world is bound up with the process of globalization. Globalization provides great opportunities for the future, not only for our countries, but for all others too. Its many positive aspects include an unprecedented expansion of investment and trade; the opening up to international trade of the world’s most populous regions and opportunities for more developing countries to improve their standards of living; the increasingly rapid dissemination of information, technological innovation, and the proliferation of skilled jobs. These characteristics of globalization have led to a considerable expansion of wealth and prosperity in the world. Hence we are convinced that the process of globalization is a source of hope for the future.” 1996 G-7 Summit 1. expansion of investment and trade 2. opening up to international trade of the world's most populous regions and opportunities for more developing countries to improve their standards of living 3. increasingly rapid dissemination of information 4. technological innovation 5. proliferation of skilled jobs September 11, 2001 AL-QAEDA at World Trade Center (USA) 26 | GEC 3 (The Contemporary World)   9-11 al- Qaeda attacked was the greatest challenge to globalization  Globalization shifted from economic globalism to military globalism.  US President Bush: “Free trade and free markets have lifted the whole societies out of poverty - so the US will work with individual nations, entire regions, and the global trading community to build a world that trades in FREEDOM and therefore grows in PROSPERITY.” Claim 5: Globalization furthers the spread of Democracy in the world Democracy is synonymous to freedom, free markets, free trade; Level of economic development is correlated to a successful democracy. Globalization economic development. Middle class = Democracy But... Globalism limits the definition of Democracy by emphasizing procedures (ex. voting), at the expense of Direct participation. “Polyarchy” - the rule of the elected elite minorities; Voting in elections is the only political participation of the citizens vs Popular Democracy - political and economic power in the hands of the masses CLAIM 6: GLOBALIZATION REQUIRES A GLOBAL WAR ON TERROR Like the previous claims, this final decontestation chain attests to globalism’s political responsiveness and conceptual flexibility. It combines the idea of economic globalization with openly militaristic and nationalistic ideas associated with the American-led global War on Terror. LOGICAL CONTRADICTIONS OF THE CLAIM 1. War on terror undermines the idea of “self-regulating market” and historical 'inevitability'. 2. Enforcing democracy and freedom at gunpoint conflicts with “liberty as absence of coercion.” 3. Anglo-American war on terror contradicts the cosmopolitan, universal concept of globalization. 27 | GEC 3 (The Contemporary World) NEW DISTINCT REGIONS OF THE WORLD - BY T.P.M. BARNETT I. Functioning Core or Core - globalization is thick of...  network connectivity, financial transactions, liberal media flows, collective security, transparency, rising standards of living, more deaths by suicide than murder  North America, most of Europe, Australia, New Zealand, small part of Latin America II. Globalization is thinning or absent  plagued by repressive political regimes, regulated markets, mass murder, widespread poverty and disease  Caribbean rim, all of Africa, the Balkans, the Caucasus, Central Asia, China, Middle East, much of Southeast Asia III. Non-Integrating Gap or Gap  breeding ground of global terrorists  Middle East countries “Seam States” - those which lie along the Gap's bloody boundaries  Mexico, Brazil, South Africa, Morocco, Algeria, Greece, Turkey, Pakistan, Thailand, Malaysia, Indonesia, and PHILIPPINES ACTIVITY/IES. Let the student research and answer the following: Choose only one to do. 1. Make a time-line on the history of Globalization by filing the table below. PERIOD/ ERA SIGNIFICANT EVENTS RESULTS/ IMPACT IN SOCIETY 2. Give two core claims of globalism and discuss it comprehensively. 28 | GEC 3 (The Contemporary World) Using/Applying Knowledge (application/integration) Choose one (1) theory whom you think best describes the process of globalization. Discuss your answer comprehensively. Evaluating Understanding (Assessment). Answer in a one whole sheet of paper: Quiz/Assessment: I. TRUE or FALSE. Write TRUE if the statement is correct and FALSE if otherwise. __________1. Manfred Steger argued that Globalization has reached maturity as an Ideology which he called globalism seen in its six (6) core claims. __________2. The second wave of globalization began around 1870 and declined around 1914 which was marked by breakthroughs in technological development, the global production of primary commodities as well as manufactured products, and mass migration. __________3. A Global village is a society whose social structure is made of networks powered by microelectronics-based information and communication technologies. __________4. Immanuel Wallerstein argued that “Globalization represents the triumph of a capitalist world economy tied together by a global division of labor.” __________5. William Robinson coined the idea of TRANSNATIONAL PRACTICES (TNP), a practices that cross-state boundaries but do not originate with state agencies or actors. II. MULTIPLE CHOICE. Choose the correct letter of your choice: ___6. He argues that globalization is a network of production, culture, and power that is constantly shaped by advances in technology, which range from communications technologies to genetic engineering. A. Marshal McLuhan C. Manuel Castells B. Roland Robertson D. William Robinson ___7. This is his second best insight, “The medium is the message”. A. Manuel Castells C. Marshall McLuhan B. George Ritzer D. Benjamin Barber ___8. The name given to the process whereby globalization causes one culture to consume another is called_______. 29 | GEC 3 (The Contemporary World)  A. Heterogeneity C. Hybridization B. Homogenization D. Polarization ___9. This dimension of McDonaldization that refers to the production process which is organized to guarantee uniformity of product and standardized outcomes. A. Calculability C. Control B. Predictability D. Efficiency ___10. According to this economist, mobile phones are the “single most transformative technology” when it comes to developing world. A. Manfred Steger C. Michael Freeden B. Mark Mazower D. Jeffry Sachs Upgrading Competence and Expanding Insights (enrichment phase) Choose one (1) Theory of Globalization which you agree with and make a Position Paper why did you choose it. Reference to/Reflection on Value/Thrusts Integration: 1. Lisandro E. Claudio and Patricio N. Abinales. The Contemporary World. C and E Publishing, Inc. 2018, 839 EDSA, South Triangle, Quezon City. 2. Martinez, et.al. The Contemporary World. Mindshapers Co. Inc. Intramuros, Mtro Manila 3. Prince Kennex Reguyal Aldama. The Contemporary World, 1st ed. Rex Book Store. Manila, Philippines.2018. 30 | GEC 3 (The Contemporary World)  CHAPTER 4: MARKET INTEGRATION Chapter Introduction The social institution that has one of the biggest impacts in society is the economy. It is the social institution that organizes all factors of production, consumption, and trade of goods in the society. One important dynamics in the global economy is the market integration in which prices among different locations or related goods follow similar patterns over a long period of time. Groups of goods often move proportionally to each other to reduce costs for both consumers and producers and to increase trade between the countries involved in the agreement. 31 | GEC 3 (The Contemporary World)  Hence, this chapter will focused on the contributions of International financial institutions, market integration, and multinational/transnational corporations in facilitating the growth of global economy. Value/Thrusts Integration Concern for others; cooperation Lesson 4 – MARKET INTEGRATION Introduction: This chapter will mainly focused on the contribution of financial institutions, market integration: its definition, historical development, types and kinds, reasons, degree and measurement, and the growth of multinational corporations emerging in today’s world economy will be discussed. Intended Outcome/Learning Objectives: At the end of the lesson the students will be able to: 1. Explain the role of international financial institution in the creation of a global market integration in the twentieth century; 2. Identify the attributes of global corporation. Stimulating Learning (Motivation) 1. Do you know what International Financial Institutions is? What are its examples? What role does it play in the global arena? 2. Do you know what market integration is? How important is market integration in the global economy? 3. Do you know what is a corporation? What contributions does it play in the global economy? Inculcating Concepts (Input/Lesson Proper) 32 | GEC 3 (The Contemporary World) A. THE INTERNATIONAL FINANCIAL INSTITUIONS World economies have been brought closer together by globalization. It is not only American economy plays an important role, but as well as other economies in the world has a significant impact in the global market and finance. For, instance the financial crisis experienced by Russia and Asia affected the world economy. Thus, the it should be noted that the strength of a more powerful economy brings greater effect on other countries than a weaker economies like what had happened in Argentina’s serious financial crisis in the late 1990’s and early 2000 had a small impact in the global economy The following are the financial institutions and economic organizations that made countries even closer when it comes on trade. 1. THE BRETTON WOODS SYSTEM After the two world wars, world leaders sought global economic system that would ensure a longer-lasting global peace; They believed that one of the ways to achieve this goal is to set a global financial institutions that would promote economic interdependence and prosperity; The Bretton Woods system was inaugurated in 1944 by UN Monetary and Financial Conference to prevent the catastrophes of the early decades of the century from reoccurring and affecting international ties. Influenced largely by the ideas of British economist John Maynard Keynes who believed that economic crisis occur not when country does not have enough money, but when money is not being spent and, thereby not moving. Delegates agreed to create two financial institutions: 1. International Bank for Reconstruction and Development (IBRD, or World Bank) 2. International Monetary Fund 2. THE GENERAL AGREEMENT ON TARIFFS TRADE (GATT) AND WORLD TRADE ORGANIZATIONS (WTO) Global trade and finance was greatly affected by Bretton Woods System (Peet, 2003). One of the systems born out of Bretton Woods was the GATT established in 1947. It was a forum for the meeting of representatives from 23 member countries focusing on trade goods through multinational trade agreements conducted in many rounds. WTO (World Trade Organization) 33 | GEC 3 (The Contemporary World)  It was out of Uruguay Round (1986-1993) that an agreement was reached to create the World Trade Organization (WTO) founded in 1995 to continue the tariff reduction under GATT and the policy they forwarded came to be called Washington Consensus; Headquarters was in Geneva, Switzerland; Unlike GATT, WTO is an independent multilateral organization that became responsible for trade and services, non-tariff related barriers to trade, and other broader areas of trade liberalization; It is based on the idea of neo-liberalism, that “by reducing or eliminating barriers, all nations will benefit.” 3. INTERNATIONAL MONETARY FUND (IMF) AND WORLD BANK IMF and World Bank were founded after WWII mainly for peace advocacy after the war as well as help the economic stability of the world. The two designed to complement each other. 3.1. INTERNATIONAL MONETARY FUND (IMF) o Main goal was to help countries which has trouble that and could not obtain money by any means, their economy collapsed and their currency was threatened. o Served as lender or a last resort for countries which needed financial assistance. 3.2. WORLD BANK (WB) o It aims to assist developing countries and improve the standards of living of the people i.e. eradication of poverty, education, etc. o Its branches are: International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA). These organizations aim to reduce poverty in different parts of the world by offering loans to developing countries for the realization of their social projects such as health, education, and other basic needs of the poor. 4. THE ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD), ORGANIZATION OF PETROLEUM AND EXPORTING COUNTRIES (OPEC), AND THE EUROPEAN UNION (EU) 4.1. THE ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD) 34 | GEC 3 (The Contemporary World)  o The most encompassing club of the richest countries in the world with 35 member states as of 2016 with Latvia as its latest member. o Very influential despite the group has little formal power emanating from the member countries’ resources and economic power. 4.2. ORGANIZATION OF PETROLEUM AND EXPORTING COUNTRIES (OPEC) o In 1960, originally comprised of Saudi Arabia, Iraq, Kuwait, Iran, and Venezuela. o Part of the major exporters of oil in the world today. o Members wanted to increase the price of oil; o Today its include UAE, Algeria, Libya, Qatar, Nigeria, and Indonesia 4.3. EUROPEAN UNION o It is made up of 28 member States in which members in the Eurozone adopted the Euro as basic currency with the exception of Great Britain, Sweden and Denmark. 5. NORTH AMERICA FREE TRADE AGREEMENT o A trade pact between US, Mexico, and Canada created on January 1, 1994; o Helps in developing and expanding world trade by broadening international cooperation; o Aims to increase for improving working conditions in North America by reducing barriers to trade as it expands the market of three countries. o The creation of NAFTA has caused manufacturing jobs from developed countries (Canada or US) to transfer to less developed country (Mexico) in order to reduce the cost of their products. o It has a positive and negative consequences: Positive - lower down prices by removing tariffs; opened up new opportunities for small and medium sized businesses. Negative – excessive pollution; loss of more than 682,000 manufacturing jobs, exploitation of workers in Mexico, and moving Mexican farmers out of business. B. MARKET INTEGRATION 35 | GEC 3 (The Contemporary World) INTEGRATION DEFINED “Integration is taken to denote a state of affairs or a process involving attempts to combine separate national economies into larger economic regions” (Robson, 1990, p.1). Integration as a means of stimulating trade and improving the division of labor among countries has been recommended by many economists, from Ricardo on. The foundation of the GATT in 1948 gave further impetus to integration by promoting greater acceptance of the most favored nation principle. Richard Kohls and Joseph Uhl have defined market integration as a process which refers to the expansion of firms by consolidating additional marketing functions and activities under a single management. KINDS OF INTEGRATION 1. Negative integration - reducing non-tariff and tariff barriers to trade can be the main tool for integrating markets; The term implies that a government’s only role is to withdraw from interference in the movement of goods and factors of production across national borders 2. Positive integration - integration of agricultural markets requires more than negative integration. Instead, the Government may have to adjust domestic policies and institutions and, moreover, there may be a need to create some supranational arrangements. FORMS OF INTEGRATION 1. Preferential Agreement - a Preferential Agreement involves lower trade barriers between those countries which have signed the agreement. 2. Free Trade Area reduces barriers to trade among member countries to zero, but each member country still has autonomy in deciding on the external rate of tariff for its trade with non-member countries. EFTA (European Free Trade Area) and CEFTA (Central European Free Trade Area) are prominent examples (for further reading refer to Wonnacott, 1966, pp.62-66). 3. Customs Union represents a higher stage of economic integration than a Free Trade Area as the member countries adopt a common external tariff. Until the end of 1992, the European Community was basically a Customs Union, although the stage of integration was somewhat higher in some respects, notably concerning the Common Agricultural Policy. 36 | GEC 3 (The Contemporary World) 4. Common Market goes beyond a Customs Union in allowing for free movement of labor and capital within the Union. Hence, the intention of a Common Market is to integrate both product and factor markets of member countries. The Single Market of the EU, which came into force on January 1, 1993, constitutes a Common Market. 5. Economic Union is the highest form of economic integration. In addition to the conditions of a Common Market, member countries also agree to integrate monetary, fiscal and other policies. TYPES OF INTEGRATION 1. Horizontal integration  This occurs when a firm or agency gains control of other firms or agencies performing similar marketing functions at the same level in the marketing sequence.  In this type of integration, some marketing agencies combine to form a union with a view to reducing their effective number and the extent of actual competition in the market.  It is advantageous for the members who join the group. In most markets, there is a large number of agencies which do not effectively compete with each other.  This is indicative of some element of horizontal integration.  It leads to reduced cost of marketing.  In this reduced competition possible. Example: independent oil refineries coming under U.S oil company. 2. Vertical integration  This occurs when a firm performs more than one activity in the sequence of the marketing process.  It is a linking together of two or more functions in the marketing process within a single firm or under a single ownership.  This type of integration makes it possible to exercise control over both quality and quantity of the product from the beginning of the production process until the product is ready for the consumer. 37 | GEC 3 (The Contemporary World)   It reduces the number of middle men in the marketing channel. Example Meat industry buys all the functioning plants needed for running this meat industry. 3. Conglomeration  A combination of agencies or activities not directly related to each other may, when it operates under a unified management, be termed a conglomeration. EFFECTS OF CONGLOMERATION Risk reduction through diversification Acquisition of financial leverage Empire – building urge. Factors Leading to a Greater Integration 1) MUTUAL BENEFIT - when it comes to trade, these nations can readily supply each other’s needs. 2) TRADE - the world economy is intertwined with each other whether we like it or not. We all want or need something from another part of the world, and global trade facilitates that. 3) SIMILAR CULTURE - the cultures of Asia are diverse but they do share many things. This makes it an easier fit during times of negotiations. The people of this region are generally alike in appearance, temperament which is seemingly peaceful. They tend to get along quite well even on an individual level. 4) COMON GOALS - the Asian region recognizes the mutual benefit of a slow integration. The territories involved are not far from each other and the industriousness of its population can work as a powerful negotiating block against those from other parts of the world. 5) SIMILAR SECURITY NEEDS - aside from small localized rebels, this association needs only to face with foreign-supported terrorist groups which are usually handled well. 6) TRADE AGREEMENTS What are Regional Trading Agreements? - Regional trading agreements refer to a treaty that is signed by two or more countries to encourage free movement of goods and services across the borders of its members. 38 | GEC 3 (The Contemporary World)  - The agreement comes with internal rules that member countries follow among themselves. - When dealing with non-member countries, there are external rules in place that the members adhere to. Quotas, tariffs, and other forms of trade barriers restrict the transport of manufactured goods and services. - Regional trading agreements help reduce or remove the barriers on trade. REASONS FOR MARKET INTEGRATION To remove transaction costs Foster competition Provide better signals for optimal generation and consumption decisions. Improve security of supply DEGREE OF INTEGRATION Ownership integration - this occurs when all the decisions and assets of a firm are completely assumed by another firm. Example: a processing firm which buys a wholesale firm. Contract integration - this involves an agreement between two firms on certain decisions, while each firm retains its separate identity. Example: tie up of a dhal mill with pulse traders for supply of pulse grains. MEASUREMENT OF MARKET INTEGRATION The measurement or assessment of the extent of market integration is helpful in the formation of appropriate policies for increasing the efficiency of marketing process. The measurement or assessment of market integration may be attempted at two levels. 1) Integration among firms of a market. 2) Integration among spatially separated markets. HISTORY OF GLOBAL MARKET INTEGRATION Before the rise of today’s modern economy, people only produced for their families; 39 | GEC 3 (The Contemporary World) Nowadays, economy demands the different sectors to work together in order to produce, distribute, and exchange products and services. 1. Agricultural and Industrial Revolution  The first economic change was the agricultural revolution where people learned how to domesticate plants and animals which was most productive than hunter-gatherer societies;  New agricultural economy (farming) help societies build surpluses, further led to major developments like permanent settlements, trade networks, and population growth.  The second major economic revolution is the Industrial Revolution of 1800s pave way to the rise of industries, new economic tools like steam engines, manufacturing, and mass production;  Factories popped up and changed how work functioned;  Increases productivity, standards of living, access to a wider variety of goods due to mass production. Results of Economic:  Economic casualties – workers work in a dangerous working conditions for low wages.  Economic inequality – industrialist known as robber barons with greater income;  Organization of workers sought to improve wages and working conditions through collective actions, strikes, and negotiations inspired by the Marxist principles. 2. CAPITALISM AND SOCIALISM  These are the two competing economic models that sprung up around the time of industrial revolution as economic more important to the production of goods. a) CAPITALISM – is a system in which all natural resources and means of production are privately owned; emphasizes profit maximization and competition as the main drivers of efficiency.  According to Adam Smith in 1770’s “invisible hand” of the market, the idea that consumers will regulate things themselves by selecting goods and services that provide the best value. 40 | GEC 3 (The Contemporary World)  b) SOCIALISM  Government has a larger role; in a socialist system, the means of production are under collective ownership.  Rejects capitalism’s private property;  Property is owned by the government and allocated to all citizens;  Emphasizes collective goals, expecting everyone to work for the common good and placing a high value on meeting everyone’s basic needs rather than on individual profit. 2. INFORMATION REVOLUTION  Ours is time of the information revolution;  Computers and other technologies are beginning to replace many jobs because of automation or outsourcing of jobs offshore. WHAT’S NEXT FOR CAPITALISM AND SOCIALISM?  Today the key part of both our economic and political landscape is corporations – are defined as organization that exists as legal entities and have liabilities that are separate from its members; they are operating across national borders that the future of the economy will play out on a global scale. C. GLOBAL CORPORATION  These are companies that extend beyond the borders of country, and are called as Multi- National Corporations and Trans-National Corporations; also referred to as Global Corporations.  They intentionally surpass national borders and take advantage and opportunities in different countries to manufacture, distribute, market, and sell their products. Example of American Companies are: McDonald, Coca-cola, General Electric and Food Motor Company. POSITIVE EFFECTS OF GLOBAL CORPORATIONS  Transnational Corporation have a significant role in the global economy. They can influence the global trade laws of the international global trade laws of the international regulatory groups. 41 | GEC 3 (The Contemporary World)   Bring jobs and industry to beleaguered agricultural areas; it also promote rapid advances in developing nations because of the ideas and innovations brought over from industrialized countries; it also makes nation around the world more interdependent which minimizes the potential for conflict.  Allocation of resources, lower prices of products, more employment worldwide, and higher product output;  Cultural diffusion – ideas and practices through the use of technology (mass media and internet) NEGATIVE EFFECTS OF GLOBAL CORPORATIONS  Benefited only the upper classes but exploiting the workers through wages cut, long working hours, substandard wages, and poor working conditions.  Company transfer through restrictive laws leaving widespread unemployment.  Losing of jobs and difficulty of finding new one to the core country.  Trade promote the self-interested agendas of corporations and autonomy; DISTINCTIONS OF MNCs/TNCs (Iwan, 2012) 1. International companies are importers and exporters, typically without investment outside of their home country; 2. Multinational companies have investment in other countries, but do not have coordinated product offerings of each country. They are more focused on adapting their products and services to each individual local market. 3. Global companies have invested in and are present in many countries. They typically market their products and services to each individual local market. 4. Transnational companies are more complex organizations which have invested in foreign operations, have a central corporate facility but give decision-making, research and development (R&D) and marketing powers to each individual foreign market. DIGITALIZATION IN THE STRUCTURE OF GLOBAL CORPORATIONS 42 | GEC 3 (The Contemporary World)  Reduce the effects of time and distance for services performed within the corporate structures such as design, finance, and accounting, advertising and brand development, legal services, inventory control, etc. PHASE OF GLOBAL CORPORATE DEVELOPMENT o BRICS (Brazil, India, and China) is the so-called “developing economies” – BRICS economies have become the most dynamic sector of global corporate growth with significant Foreign Direct Investment (FDI) over the three decades. ACTIVITY/IES. Let the student research and answer the following: Choose only one (1). 1. Why is European Union considered a prominent Economic union? What are its advantages and disadvantages as a union in Eurozone? 2. Why are Brazil, India, and China the most dynamic economies today? Using/Applying Knowledge (application/integration). Choose only one (1). 1. Make an Essay that tells How important are the TNCs/MNCs in the global economy? 2. How do you view about GATT/WTO in the Philippine economy being a signatory of the International Agreement. Views about GATT/WTO Positive Negative Evaluating Understanding (Assessment). Answer in a one whole sheet of paper: Quiz/Assessment: I. IDENTIFICATION. Give what is being asked. __________________________1. An economic system in which all natural resources and means of production are privately owned, and further emphasizes profit maximization and competition as the main drivers of efficiency. 43 | GEC 3 (The Contemporary World) __________________________2. It is so-called “developing economies” that have become the most dynamic sector of global corporate growth with significant Foreign Direct Investment over the three decades. __________________________3. It denotes a state of affairs or a process involving attempts to combine separate national economies into larger economic regions. __________________________4. An economic system that emphasizes collective goals, expecting everyone to work for the common good and placing a high value on meeting everyone’s basic needs rather than on individual profit. __________________________5. A kind of integration implying that government’s only role is to withdraw from interference in the movement of goods and factors of production across national borders. II. MULTIPLE CHOICE. Choose the correct letter of your choice: ___6. It is the highest form of economic integration were member countries agree to integrate monetary, fiscal and other policies A. Common Union C. Free Trade Area B. Market Union D. Economic Union ___7. It is an independent multilateral organization that became responsible for trade and services, non-tariff related barriers to trade, and other broader areas of trade liberalization. A. International Monetary Fund C. General Agreement on Tariffs and Trade B. World Bank D. World Trade Organization ___8. A combination of agencies or activities not directly related to each other may, when it operates under a unified management is called ____________. A. Vertical C. Horizontal B. Conglomeration D. Positive ___9. It is an international organization founded after WWII with the main goal of helping countries which has trouble when their economy collapsed and their currency was threatened. A. International Monetary Fund C. General Agreement on Tariffs and Trade B. World Bank D. World Trade Organization ___10. It is a form of integration allowing for free movement of labor and capital within the Union. A. Common Union C. Free Trade Area 44 | GEC 3 (The Contemporary World)  B. Market Union D. Economic Union Upgrading Competence and Expanding Insights (enrichment phase) Make a poster-slogan on the negative/positive impacts of GATT/WTO in Philippine Agriculture. Reference to/Reflection on Value/Thrusts Integration: 1. Lisandro E. Claudio and Patricio N. Abinales. The Contemporary World. C and E Publishing, Inc. 2018, 839 EDSA, South Triangle, Quezon City. 2. Martinez, et.al. The Contemporary World. Mindshapers Co. Inc. Intramuros, Mtro Manila 3. Prince Kennex Reguyal Aldama. The Contemporary World, 1st ed. Rex Book Store. Manila, Philippines.2018. CHAPTER 5: THE ORIGINS OF INTER-STATE SYSTEM Chapter Introduction The State has traditionally been the subject of the most interest to scholars of global politics because it is viewed as “the institution that creates warfare and sets economic policies of a country.” Furthermore, the state is a political unit that has the authority over its own affairs 45 | GEC 3 (The Contemporary World) in which its borders are recognized by other countries that they have the right to determine exactly what is going to happen in their country (Aldama, 2018). Indeed, the origins of the present-day concept of sovereignty can be traced back to the Treaty of Westphalia, which was a set of agreements signed in 1648 to end the Thirty Years’ war between the major continental powers of Europe (Claudio and Abinales, 2018). Today, globalization of politics created an atmosphere where ideas of nation-state and sovereignty, government control, and state policies are challenged from all sides. Some scholars suggest that, globalization has decrease the power of the state and that other actors are actually becoming powerful that includes multinational corporations and global civil organizations, like Red Cross that cross national borders. Hence, regional alliances and worldwide organizations of states are pushed to cooperate and collaborate together including International and regional economic bond bodies, such as IMF and World Bank, and non-state actors. Value/Thrusts Integration Alliance building; cooperation; peaceful co-existence Lesson 5 - THE ORIGINS OF INTER-STATE SYSTEM Introduction: The world is compose of many states with different forms of government. When studying of political, military, and other diplomatic engagements between two or more countries is called International relations. Moreover, when they are going to explore deepening of interaction between states is referred to the phenomenon of Internationalism. According to scholars, there is a decrease in the power of the state and that other actors are actually becoming powerful. Hence, this manifests efforts of countries and governments in the world to cooperate and collaborate together. The MNCs and NGOs such as Amnesty International, are significant organizations that put into question the strength of the national economy and global politics. Nevertheless, it is important to study international relations as a facet of globalization, because states or governments are key drivers of global processes. 46 | GEC 3 (The Contemporary World)  In this chapter, the origin of interstate system, the effects of Globalization on government Institutions that govern international relations, and the difference between internationalism from global governance will be discussed. Intended Outcome/Learning Objectives: At the end of the lesson the students will be able to: 1. Explain the effects of globalization on governments 2. Identify the institutions that govern international relations 3. Differentiate internationalism from globalism. Stimulating Learning (Motivation) 1. Do you have an idea of what global governance is? 2. Is global governance synonymous with global government? 3. Whom do you think are the primary actors in global governance? Inculcating Concepts (Input/Lesson Proper) INTERSTATE SYSTEM  Westphalian system provided stability for the nations of Europe until it faced its first major challenge by Napoleon Bonaparte – believed in spreading the principles of the French Revolution – liberty, equality and fraternity.  Anglo and Prussian armies finally defeated Napoleon in the Battle of Waterloo in 1815;  To prevent another war, the new system created by the Royal Powers - “The Concert of Europe,” is an alliance of Great powers (United Kingdom, Austria, Russia, and Prussia restoring the world of monarchical, hereditary, and religious privileges before the French Revolution and the Napoleonic Wars).  This system is called, the Metternich system named after the Austrian diplomat, Klemens von Metternich;  The Concert’s power and authority lasted from 1815 to 1914 at the dawn of World War I. THE DIFFERENCE BETWEEN NATION AND STATE A. STATE 47 | GEC 3 (The Contemporary World)   State refers to the community of persons permanently occupying a definite portion of territory, independent form external control, and possessing an organized government to which greater body of inhabitants renders habitual obedience.  The state is a political and legal concept.  It is not subject to external control.  A single state may consist of one or more nations or people.  State refers to a country and its government; a state as four attributes: 1. People – called the citizens 2. Territory – it governs a specific territory 3. Government – crafts various rules that people follow 4. Sovereignty – refers to internal and external authority 1. NATION  Nation is an “imagined community”; limited for it has boundaries;  It is a cultural or ethnic concept, which may consist of one or more states.  It is a large group of people who are bound together, and recognize a similarity among themselves, because of a common culture; in particular, a common language seems important in creating nationhood.  A single nation may be made up of several states. GOVERNMENT AND CITIZENS IN A GLOBALLY INTERCONNECTED WORLD OF STATES A STATE IN A WORLD OF ECONOMIC INTERDEPENDENCE Globalization is commonly equated with the rising momentum of global free-market capitalism in the final decades of the Twentieth Century, accompanying the rise of transnational enterprises, and the resulting disparities between easy flows of money and commodities across border and the legal barriers and logistical hurdles that keep most workers ties in their home communities. Many critics of the so called “Washington Consensus” and its “neo-liberal” emphasis on deregulation, privatization, and free trade see globalization as imposing force of choice upon a state either to conform to free market principle or run the risk of being left behind. Journalist Thomas Friedman in phrase “Golden Straitjacket” describe how the states are forced into politics 48 | GEC 3 (The Contemporary World) that suits the preferences of investment houses and corporate executive who swiftly move money and resources into countries favored as adaptable to the demand of the international business or withdraw rapidly from countries that are uncompetitive. Hence, Friedman’s colorful language has essentially claim that states have lost an important element of economic sovereignty and neo-liberalism is beyond contestation (Martinez, et.al. 2018). ECONOMIC AND POLITICAL INTEGRATION: THE CASE OF THE EUROPEAN UNION The rising economic interdependence of the past century resulted for the states to form regional partnerships with their neighbors, from loosely-knit organizations promoting trade and economic cooperation such as African Union, ASEAN to trading blocs such NAFTA and the Caribbean Community. Europe has clearly stand out as the continent’s political elites made a leap into a market integration shortly after WWII with the launching of the European Coal and Steel Community. Today European Union has 27 member states, with a single currency and monetary system, and supranational European Parliament with growing legislative powers alongside the Council of Ministers. In recent treaty revisions, the EU has expanded into foreign and security policy instituted in the 1992 Maastricht Treaty, a common citizenship that affords citizens of the member states the right to live, work, vote and even run for office in European Parliamentary elections outside one’s native member state. The EU is regarded by some leading scholars as having strengthened the state because it empowers the member states to protect their interests into the international arena enabling the national governments to build resources directed toward international negotiations, and bolsters national regulatory mechanisms to fulfil the resulting international commitments. THE RISE OF INTERNATIONAL LAW AND UNIVERSAL PRINCIPLES The failure of the League of Nations strengthened the collected will of world leaders to start another international organization to facilitate global dialogue and promote human rights and fundamental freedom. The United Nations was formed in 1945 though it has huge 49 | GEC 3 (The Contemporary World) limitations: it never transcended the states system and instead operates mainly as a forum for states to air their differences and try to resolve them. This is especially apparent within the Security Council and its outdated composition that awards veto power to each of the five countries that won the Second World War, as well as the General Assembly’s relative lack of power and its state-based configuration. Although, UN has been unable to prevent many atrocities and genocides around the world during its history. Concerns about the limitations led to formation of ad hoc tribunal and the permanent establishment of International Criminal Court. As the number of states has risen steadily, national leaders have turned to the UN and European rights declarations for inspiration when drafting constitutions and have often signed human rights conventions quickly as a way of building up global respectability for their new political legal systems. According to Slaughter (2004), a trans-governmental networks improve the competence and regulatory effectiveness of governments and bring governments around the world into greater harmony with international norms and treaties. STATES AS TARGETS: THE RISE OF TRANSNATIONAL ACTIVISM Transnational activism has deep roots that go back to 19 th century campaigns against slavery, foot-binding practice in China, and for women’s voting rights. It is multifaceted as internationalism within which it has emerged. That although globalization and global neo- liberalism are framed around which many activists mobilize, the protest and organizations are not the product of a global imaginary but of domestically rooted activists. INSTITUTIONS THAT GOVERN INTERNATIONAL RELATIONS What is International Relations? International relations is concerned with relations across boundaries of nation-states. It addresses international political economy, global governance, intercultural relations, national and ethnic identities, foreign policy analysis, environment, international security, diplomacy, terrorism, media, social movements and more. It is a multi-disciplinary field that does not restrict students to one approach and employs a variety of methods including discourse analysis, statistics and comparative and historical analysis (https://international relations.sfsu.edu). 50 | GEC 3 (The Contemporary World)  In the international arena, institution has been used interchangeably with regime, which has been defined by Krasner as a set of explicit or implicit “principles, norms, rules, and decision- making procedures around which actors’ expectations converge in a given area.” Modern international relations give us deep cultural understanding that is a foundation for interaction with cultures with different values and beliefs. Countries need to communicate to survive depending on trade and exchanges with others that are beneficial in many ways. Example of an International institutions is UN were it mirrors the structure of existing international system insofar as it is dominated by leading powers such as permanent members of the Security Council. Likewise, the EU, and NATO, in which such interaction reduces a long term potential for international conflict. When scholars refer to groups like UN or institutions like IMF and the WB, they call them International organizations. Although international NGOs are sometimes considered as IOs, which the term refers to International intergovernmental organizations or groups that primarily made up of member states. DIFFERENT INTERNATIONAL ORGANZATIONS 1. UNITED NATION – is an instrument of international that UN member states are bound by it. The UN charter codifies the major principles of international relations, from sovereign equality of States to the prohibition of the use of force in international relations (https://www.un.org). UN FIVE PRINCIPLES OF MUTUAL COEXISTENCE (as stated by Panchsheel Treaty, signed on April 24, 1954): a) Mutual respect for sovereignty and territorial integrity b) Mutual non-aggression c) Non-interference in each other’s internal affairs d) Equality and mutual benefits e) Peaceful co-existence 2. EUROPEAN UNION – the European Commission is responsible for designing European development policy and delivering aid throughout the world as effectively as possible. It 51 | GEC 3 (The Contemporary World)  ensures that EU is represented internationally in development policy matters and in negotiating agreements on international development issues (https://ec.europa.eu). 3. NORTH AMERICAN FREE TRADE AGREEMENT (NAFTA) - fundamentally reshaped North American economic relations, driving unprecedented integration between the developed economies of Canada, US and Mexico’s developing one. It boosted trade by eliminating all tariffs between three countries and creating agreements on international rights for business investors. Furthermore, reduced the cost of commerce by spurring investment and growth especially small business (https://www.thebalance.com). 4. WORLD TRADE ORGANIZATION (WTO) – is the only international organization dealing with the global rules on trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and as freely as possible. The WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters and importers conduct their business (https://www.wto.org). 5. INTERNATIONAL MONETARY FUND (IMF) – is an international organization of 189 member countries that works to ensure the stability of international monetary and financial system. Its mandates includes facilitating the expansion of balanced growth of international trade, promoting exchange stability, and providing opportunity for orderly correction of countries’ balance of payments problem (https://www.imf.org). 6. WORLD BANK (WB) – is an international organization affiliated with the United Nations and designed to finance projects that enhance the economic development of member states (https://worldbank.org) DIFFERENCE BETWEEN INTERNATIONALISM AND GLOBALISM Although the two terms appear to be similar, yet there exist a conceptual difference between the two: Globalism is much wider in terms of its meaning, scope and outcome. It emphasizes the dilution of sovereign expression of the nations but demonstrate the conflict arising out of this dilution as well. However, this does not mean that globalism is negative concept because surrendering of national sovereignty (to some extent) is aimed to moderate the barriers to international exchanges. In addition, globalism is an ideology posits by Manfred Steger which 52 | GEC 3 (The Contemporary World) are based on the belief that people, goods and information able to cross the national border unfettered. It is further, a widespread belief among powerful people that the global integration of economic markets is beneficial for everyone, since it spread freedom and democracy across the world. On the other hand, internationalism lays stress in the solidarity and cooperation among nations, while acknowledging their sovereign character. Moreover, internationalism is a political, economic, and cultural cooperation between nations. It is further a system of heightened interaction between various sovereign states particularly the desire for greater cooperation and unity among states and people. Nevertheless, in spite of this conceptual differences between the two terms, we can see the amalgamation of this two phenomenon particularly in this contemporary world order which the international and transnational exchange witness globalism and internationalism with varying degrees (abhipedia.abimanu.com). Conclusion  Internationalism is but one window into the broader phenomenon of globalizat