Lecture no. 4 a globalization

Definitions of Globalization
The Integration of World Economy (Giddens
1990:21)
 De-Territorialization-or… the growth of
supraterritorial relations between people (Scholte
2000:46)
 Time-space compression (Harvey 1989)

Globalization word came from Glob
which means world wide-countries
coming to gathers.

Globalization is the process of shifting
the world we live in the place of isolation
to place of integration. It is the product
of advancement of technology.

Globalization or globalisation is the
process of international integration
arising from the interchange of world
views, products, ideas, and other aspects
of culture.

Simply stated, globalization means an
increase in cross-border interactions that
includes the flow of goods, services,
finances, people, nature, laws and ideas that
lead to high similarity globally in different
life spheres.

Bretton Woods Agreement-1944
 New Global Monetary System Set up
 Replaced Gold with Dollar
 It Set up IMF and World Bank to Monitor New System
 States had to maintain fix exchange rate
 The system collapsed after 30 years b/c Dollar not = currencies, Dollar = Gold

IMF and World Bank
 Bretton Woods system couldn't worked with IMF, if currency value drops they
needed bails.
 States needed global central banks to borrow otherwise trade barriers & Interest
rates will increase.

Why Bretton Woods System Collapsed
 In 1971 US faced Inflation, unemployment, and
recession
 President Nixon started to deflate dollar’s value in
gold
Initially it was 1/35 USD per ounce
Nixon: 1/38 USD per ounce then to 1/42
Now: 1/1773.45 USD per ounce.

Marshal Plan 1948
$13 Bn
 Europe Recovery Program
 17 beneficiary states
 Given b/c communist parties forcing voter in W-Europe
 Given to restore industrial and agriculture products, financial
stability, and expand trade
Benefits
 Increase GDP 15-25%
 It renewed W-Europe chemical, engineering, and steel
 Truman announced it for less developed states

Evidencing Globalization
 Global Communication-Arab Spring
 Global Migration-
 Global Transnational Problems

Four Aspects of Globalization IMF
 Trade and Transaction
 Capital investment and Movement
 Migration and Movement of People
 Dissemination of Knowledge

Three Aspects of Globalization
Academic
 Economic Globalization
 Cultural Globalization
 Political Globalization

Types of Globalization
 Neoliberalism( Increase powers of Govt and Unions, Shrinking Corporate profits)
 Underground Globalization ( run by criminals, Illegal flow of goods, services etc, it supports neoliberalism means complete
absence of Govt control, legality, and morality)
 Keynesian Globalization ( Encourage Foreign Aid, technology, and long term projects, discourage short term projects, stop the
import of intermediate goods)
 Ecological Globalization ( Global Warming)
 Green Globalization ( Countries should live within ecological limits, Rich countries should start it first, then developing)
Does De-Globalization exists?
North Korea

Why we Need it?
 It will reduce Poverty
 It will provide employment
 It will bring technology
 It will bring Economic Stability

What we need for Globalization
 Capital
 High Technology
 Foreign Financial Investment/ FDI
 Capitalism
 Reduce Social Expenditures
 Open Gate for Multinational Companies/ Corporations
 National Treatment with the Multinational Companies

Impacts of Globalization
Liberals:
1. It increases interdependence
2. It ends isolation
3. It makes state dependent
 Realists:
1. Integration can’t be left
2. Cooperation can’t be left
3. It creates a position of winner and loser
4. It can’t control future

Benefits of Globalization
 Common Problems
 Free Trade
Competitive Prices
 Single Global Market
 Modernization

Drawbacks
 Limited Resources
 Degradation of Environment
Multinational Corporation
Technology Theft
Spread of Diseases

Suggestions to manage Globalization
 Leadership
 Balanced Trade
 Controlling Climate Change
 Rules and Regulation

1. How many apple user are there?
2. What models they purchase?
3. Where these products are designed, manufactured and assembled?
4. Why it’s (Globalization) complex?
5. What image we absorb, when we hold these products in the palms of our hand
6. Where Apple Headquarter?
7. Name global supplier
8. Name the raw material used for batteries
9. what thing/things are essential to manufacture every single component
10. what has made us integrated?
11. What is share responsibility?
Try to find answers

1. How many apple user are there? [Hundreds of million]
2. What models they purchase? [iPhone -iPad]
3. Where these products are designed [US] & assembled [China & Brazil]?
4. Why it’s (Globalization) complex?
5. What image we absorb, when we hold these products in the palms of our hand
[Production & Distribution Network]
6. Where Apple Headquarter? [US]
7. Name global supplier [700 supplier, Malaysia - Malta]
8. Name the raw material used for batteries [cobalt]
9. what thing/things are essential to manufacture every single component? [Raw
Material]
10. what has made us integrated? [Global Production Networks]
11. What is share responsibility? [to ban child labour, improve workers rights in
emerging economies]
Wow! The answers are.

1. Is Globalization a Myth or Reality?
2. Did you analyzed any benefits of Globalization?
3. Is Globalization a threat to sovereignty?
4. Should Globalization need to bother Ethical Codes?
5. What are some of the implications of global production networks for national
economic sovereignty?
6. Should they be subject to greater or lesser regulation? Why?
7. Do you think that global production networks have ethical implications for
consumers? Why or why not?
8. Does Globalization help or hurt developing countries?
Try to find answers

Lecture no. 4 a globalization

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