Unit Test 1 Review - Globalization PDF

**UNIT TEST 1** **PRE-MODERN** In this period the invention of writing and the wheel were great social and technological boosts that moved globalization to a new level **POLITICAL DIMENSION** It is often used to legitimize certain political interests or to defend dominant power structures. Enlarge...

**UNIT TEST 1** **PRE-MODERN** In this period the invention of writing and the wheel were great social and technological boosts that moved globalization to a new level **POLITICAL DIMENSION** It is often used to legitimize certain political interests or to defend dominant power structures. Enlargement and strengthening of political interrelations across the globe. **TECHNOLOGY** This is considered as one principal driver of globalization. **ECONOMIC DIMENSION** This refers to the extensive development of economic relations across the globe as a result of technology and the enormous flow of capital that has stimulated trade in both sources and goods **CULTURAL DIMENSION** This results hybridization- a constructive interaction process between global and local characteristics which is often visible in food, music, dance, film, fashion, and language **JIHADIST** This is a religious response to the materialist assault by the ungodly West in the rest of the world. **CONTEMPORARY PERIOD** The period of leap in the history of globalization. **GLOBALIZATION** This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world; this is about growing worldwide connectivity. **INDIVIDUALISM AND CONSUMERISM** These are the dominant cultural characteristics of our age and the drive for economic success stimulated by the internet and other technological devices circulate much more easily than they did in earlier periods **LESSON 1 (THE GLOBAL ECONOMY)** **Portuguese and Spain** discovered Philippines in search for spices that led to colonization **Economic Globalization --** expanding interdependence of world economies -one of three main dimension of globalization **Global Economy --** Interconnected worldwide economic activities that take place between multiple countries -goods and services are traded across national borders **International Monetary Fund (IMF) --** defined economic globalization as a historical process, result of human innovation and technological progress **Character of New World Economy** 1. More options for production 2. Chance to create new markets 3. Small firms can think big 4. More level playing field 5. Networks are important 6. Culture is no constraint **Specific (f)actors that facilitate economic globalization:** 1. The International Economic and Financial Organization 2. The International Governmental Organization (IGO's) 3. The Media 4. The Multilateral Development Banks 5. The Nation-States 6. The Non-Governmental Organizations (NGOs) 7. The Trans-National Corporations (TNCs) 8. The United Nations (UN) System **MIDWIVES OF GLOBALIZATION -** Government **LESSON 2 (MARKET INTEGRATION)** - Occurs when prices among different locations/related goods follow similar patterns over a long period of time - Allows to spread marketing messages across multiple channels **Global Market Integration --** result of establishment of a global economy that involved the homogenization of trade and commerce **Types of Related Markets** - **Stock Market Integration --** condition in which stock markets in different countries trend together and depict same expected risk adjusted returns - **Financial Market Integration --** open market economy between countries facilitated by a common currency **Global Corporation --** business that operates in two or more countries -"multinational company" **The Finance Function in a Global Corporation** 1. **Financing --** borrowing in countries with high tax rates and lending to operations in countries with lower rates 2. **Risk Management --** offset natural currency exposures through worldwide operations instead of managing currency exposures through financial markets 3. **Capital Budgeting --** Smarter on valuing investment opportunities CFO's can add value **Foreign Direct Investment (FDI) --** corporate origin -major driver of extended global corporate development -investment made by company or individual in one country in business interests in another country in form of establishing business operations / acquiring business assets in other country **BRICS Economies --** Brazil, Russia, India, China and South Africa -BRIC was originally coined in 2003 by **Goldman Sachs** -speculates that by 2050 these economies will be the most dominant -South Africa was added to the list on April 13,2011 **General Agreement on Trade in Services (GATS) --** First multilateral agreement covering trade in services (Uruguay Round) -came into force in 1995 **General Agreement on Tariffs and Trade (GATT) --** deals with trade and goods **Primary objectives** 1. ensure all signatories are treated equitably when accessing foreign markets 2. promote progressive liberalization of trade **LESSON 3 (THE GLOBAL INTERSTATE SYSTEM)** **Interstate --** system of unequally powerful and competing states in which no single state is capable of imposing control on all others -states are in interaction with one another in a set of shifting alliance and wars **State --** independent political communities each of which possesses a government and assert sovereignty - Legal and political entity - Linked to a territory - Exist with sovereignty - Established consciously - United by law **Nation --** emphasizes organic ties that hold groups of people together and inspire a sense of loyalty and belonging - Socio-cultural entity - Linked to a group of people - May exist even w/o sovereignty - Can be created unconsciously - United by bond and shared history **Nation-State --** modern countries and their apparatuses rules over a single nation -political community that emanates from civic society to legitimately execute peace **Golden Straitjacket --** belief that globalization imposes a forced choice upon states either to conform to free market principles / run the risk of being left behind **2 things that will happen:** Economy grows, politics shrinks **Neoliberalism --** intensification of the influence and dominance of capital -values market exchange capable of acting as a guide to all human action -emphasizes significance of contractual relations in the marketplace -social good will be maximized by maximizing the reach and frequency of market transactions **Economic Sovereignty --** power of national government to make decisions independently of those made by other governments **Concepts** 1. International legal Sovereignty 2. Westphalian Sovereignty 3. Interdependence Sovereignty 4. Domestic Sovereignty **Worlds Three Leading Financial Institutions** 1. **World Bank (WB) --** international financial institution that provides loans to countries of the world for capital projects - Established by United Nations Monetary and Financial Conference / the Bretton Woods conference 2. **International Monetary Fund (IMF) --** (three ways) - keeping track of global economy and the economies of member countries - Lending to countries with balance of payments difficulties - Giving practical help to member 3. **World Trade Organization (WTO) --** regulates international trades deals with the rule of trade between nations - Ensure the trade will flow smoothly, predictably and freely as possible - Act as forum in negotiation trade agreements **European Integration --** process of industrial, political, legal, economic, social and cultural integration of states wholly / partially in Europe -come about through the European Union and its policies -described as a process by which a group of countries strives to increase their level of welfare -arrangement between different regions that often includes the reduction / elimination of trade barriers and the coordination of monetary and fiscal policies **European Union (EU) --** international organization comprising 28 european countries governing common economic, social, and security policies **Seven Stages of Economic Integration** 1. Preferential Trading Area (PTA) - Happens when agreement on reducing / eliminating tariff 2. Free Trade Area (agreement - FTAs) - Eliminate import tariffs as well as import quotas between signatory countries - Limited to few sectors or can encompass all aspects of international trade 3. Customs Union - Removal of tariff barriers between members together with acceptance of a common / unified external tariff against non-members 4. Common Market (CM) - all barriers to mobility of people, capital and other resources within the area - eliminating non-tariff barriers to trade such as the regulatory treatment of product standards are removed by CM 5. Economic Union - Trading block that has both common market between members - Common trade policy towards non-members 6. Economic and Monetary Union - Involves single economic market, common trade policy, single currency and common monetary policy 7. Complete Economic Integration - Final stage in which member states completely forego independence of both monetary and fiscal policies **Theories of European Integration** **Neo-functionalism --** focuses on supernational institutions of EU which the main driving forces are interest group activity at the European and national levels, political party and role of govt and supranational institutions Theory of regional integration, building on the work of Ernst B. Haas and Leon Lindberg (both an American political scientist) **Intergovernmentalism --** provides conceptual explanation of the European integration process -emphasizing on role of national states \- suggested by Stanley Hoffmann **Liberal Intergovernmentalism --** application of rational institutionalism to the field of European integration is the aim of this theory **Multi-level Governance (MLG) --** dispersion of authority across multiple levels of political governance **Transnational Activism in States --** Mobilization of collective claims by actors located in more than one country and/or addressing more than one national government **Social Movement --** type of group action -organizational structures and strategies that may empower appressed populations to mount effective challenges and resist the more powerful and advantaged elites **Global Justice Movement --** the loose collection of individuals and groups often reffered to as a "movement of movement" -advocate fair trade rules , negative to current institutions of global economics (World Trade Organization) **New Transnational Activism --** multifaceted as the internationalism **Social Media --** a computer-based technology that facilitates the sharing of ideas and information and the building of virtual networks and communities **LESSON 4 (CONTEMPORARY GLOBAL GOVERNANCE)** **Global Governance / World Governance --** product of neo-liberal paradigm shifts in international political and economic relations -movement towards political integration of transnational actors aimed at negotiating responses to the problems that affect more than one state -Involves institutionalization -capacity of within the international system to provide government-like services and public goods in the absence of a world government -combination of informal and formal ideas, values, rules, norms, procedures, practice, policies and organizations that help all actors-state, international organization, non-government organizations identify, understand and address transboundary problems **International Organization (Ios) --** used to refer international intergovernmental orgs on groups that are primarily made up member-states **Power of International Organization** 1. Power of classification 2. Power to fix meanings 3. Power to diffuse norms **Roles and Functions of the United Nations --** UN is tasked to promote international cooperation and to create and maintain international order **Four Main Purposes of the UN Charter** 1. Maintain worldwide peace and security 2. Developing relations among nations 3. Fostering cooperation in order to solve economic, social, cultural or humanitarian international problems 4. Providing forum for bringing countries together to meet the UN's purposes and goals **UN** aims to save succeeding generations from the scourge of war **Basic Elements of a State** 1. Territory 2. People 3. Sovereign Power (authority of a state to govern itself) **Globalization's Impact on the State** 1. Poverty 2. Environmental pollution 3. Economic Crisis 4. Organized crime and terrorism **Decision making** processes in globalization is complex as it takes place in various levels such as sub-national, national, and global that lead to the growth of **multi-layered system of governance** **LESSON 5 GLOBAL DIVIDES (NORTH AND SOUTH)** **GLOBAL SOUTH** -- low income, politically/culturally marginalized -Also called developing world, developing countries, less developed regions, poorer southern regions of wealthy northern countries -refers to these countries "interconnected histories of colonialism, neo-imperialism, and differential economic and social change through which large inequalities in living standards, life expectancy and access to resources are maintained. **MAJOR DIFFERENCES OF NORTH AND SOUTH** **NORTH** - Less population - High wealth - High standard of living - High industrial development - Industry **SOUTH** - High population - Low wealth - Low standard of living - Low industrial development - Agricultural **First World --** developed, capitalist, industrial countries -North America, Western Europe, Japan, Australia **Second World --** former communist-socialist -Russia, Eastern Europe, Turk States, China **Third World --** Developing Countries -Africa, Asia, Latin America **Regionalism --** Decentralization of political powers or competencies **Japan --** raw materials like coal and iron allows them to gain competitive edge in the global manufacturing market **India --** opened up and emphasized export-oriented strategy **China --** world's largest importers of basic raw materials and steel production **China and India** become a major source of international migrant labor