1.
Defining
Globalization
Globalization explained (explainity
® explainer video) - YouTube
“Globalization” is a catchphrase familiar
to anyone tuned in to social media. Every
day we hear the term globalization on the
news, read it in the papers, and overhear
people talking about it.
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“
the process of interaction and integration
among people, companies, and
governments worldwide. As a complex
and multifaceted phenomenon,
globalization is considered by some as a
form of capitalist expansion which entails
the integration of local and national
economies into a global, unregulated
market economy.” Shalmali Guttal (2007)
”
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the geographic dispersion of
industrial and service activities, for
example research and development,
sourcing of inputs, production and
distribution, and the cross-border
networking of companies, for
example through joint ventures and
the sharing of assets. Organization for Economic
Cooperation and Development
”
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the word used to describe the growing
interdependence of the world’s
economies, cultures, and populations,
brought about by cross-border trade in
goods and services, technology, and
flows of investment, people, and
information
”
Peterson Institute for International Economics
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the ability to produce any good or
service anywhere in the world, using
raw materials, components, capital
and technology from anywhere, sell
the resulting output anywhere and
place the profits anywhere
”
Peter Jay
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the increased interconnectedness and
interdependence of peoples and countries, is
generally understood to include two inter-related
elements: the opening of international borders to
increasingly fast flows of goods, services, finance,
people and ideas; and the changes in institutions and
policies at national and international levels that
facilitate or promote such flows. Globalization has the
potential for both positive and negative effects on
development and health
World Health Organization
”
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the inexorable integration of markets, nation-
states, and technologies to a degree never
witnessed before – in a way that is enabling
individuals, corporations and nation-states to
reach around the world farther, faster, deeper,
and cheaper than ever before and in a way that
is enabling the world to reach into individuals,
corporations, and nation-states farther, faster,
deeper, and cheaper than ever before
Thomas Friedman
”
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the process of greater interdependence among
countries and their citizens. It consists of
increased integration of product and resource
markets across nations via trade, immigration,
and foreign investment – that is, via
international flows of goods and services, of
people, and of investment such as culture and
the environment. Simply put, globalization is
political, technological, and cultural, as well as
economic Robert J. Carbaugh
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“
a process in which geographic distance
becomes less a factor in the establishment and
sustenance of border-crossing, long distance
economic, political, and socio-economic
relations. People become aware of this fact.
Networks of relations and dependencies
therefore become potentially border-crossing
and worldwide. This potential
internationalization of relations and
dependencies causes fear, resistance, actions,
Rudd Lubbers
and reactions
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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.
This is a dialectical process because such local
happenings may move in an obverse direction
from the very distanciated relations that shape
them. Local transformation is as much part of
globalization as the lateral extension of social
connections across time and space
Anthony Giddens
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2.
Converging
Currents of
Globalization
✗Most scholars agree
that the most significant
components of
globalization is the
economic reorganization
of the world. The
characteristics of this new
world arrangement are:
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1. Global communication
systems that link all regions of
the planet instantaneously
and global transportation
systems capable of moving
goods quickly by air, sea, and
land;
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2. Transnational
conglomerate corporate
strategies that have
created global
corporations more
economically powerful
than many nation-states;
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3. International
financial institutions that
make possible 24-hour
trading with new and
more-flexible forms of
monetary flow;
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4. Global
agreements that
promote free trade;
This Photo by Unknown Author is licensed under
CC BY-SA-NC
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5. Market economies
that have replaced state-
controlled economies, and
privatized firms and services,
like water delivery, formerly
operated by governments;
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6. An abundance of
planetary goods and
services that have arisen
to fulfill consumer
demand (real or This Photo by Unknown Author is licensed under
CC BY
imaginary)
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7. An army of
international workers,
managers, executives,
who give this powerful
economic force a human
dimension.
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3.
Factors that
have contributed
to Globalization
1. The price of transporting
goods has fallen significantly,
enabling goods to be
imported and exported more
cheaply due to
containerization and bulk
shipping;
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2. The
development of the
internet to organize
trade on a global
scale;
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3. Transnational
corporations or TNCs
have taken advantage of
the reduction or lowering
of trade barriers;
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4. The desire of TNCs to profit
from lower unit labor costs
and other favorable
production factors abroad has
encouraged countries to This Photo by Unknown Author is licensed under
CC BY-SA
regulate their tax systems to
draw in foreign direct
investment (FDI);
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5. Transnational and
multinational companies
have invested significantly
in expanding
internationally;
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6. The collapse of
communism in the
Soviet Union; and
This Photo by Unknown Author is
licensed under CC BY-NC
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The Soviet was made up of
15 Soviet Socialist Republics:
Armenia, Azerbaijan,
Belorussia (now Belarus),
Estonia, Georgia, Kazakhstan,
Kirgizia (now Kyrgyzstan),
Latvia, Lithuania, Moldavia This Photo by Unknown Author is
licensed under CC BY-NC
(now Moldova), Russia,
Tajikistan, Turkmenistan,
Ukraine, and Uzbekistan.
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7. The opening of
China to world trade.
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4.
Advocates and
Critics of
Globalization
Advantages
✗ Productivity increases
faster when countries Disadvantages
Millions of workers
produce goods and
have lost their jobs
services in which they because of imports
have a comparative or shifts in
advantage. Living production abroad.
standards can Most find new jobs
increase more rapidly. that pay less.
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Advantages Disadvantages
✗ Global Millions of
competition and workers fear
cheap imports getting laid off,
keep a constraint especially at
on prices, so those firms in
inflation is less import-
likely to disrupt competing
economic growth. industries.
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Advantages
✗An open economy Disadvantages
promotes Workers face demands
technological of wage concessions
from their employers,
development and
which often threaten
innovation, with to export jobs abroad
fresh ideas from if wage concessions
abroad. are not accepted.
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Advantages Disadvantages
✗ Jobs in export industries Besides blue-collar
tend to pay about 15 jobs, service and white-
percent more than jobs collar jobs are
in import-competing increasingly vulnerable
industries. to operations being
sent overseas.
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Advantages Disadvantages
✗ Unfettered capital Workers can lose their
movements competitiveness when
provide workers companies build
access to foreign state-of-the-art
investment and factories in low wage
maintain low countries, making
interest rates. them as productive as
those in the
developed countries.
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Thanks
Any questions?
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