CWORLD

• Definition of globalization:

  • "increasing global interconnectedness"
  • "the expansion and intensification of social relations across world-time and world-space"
  • "a complex range of processes, driven by a mixture of political and economic influences"
  • "the swift and relatively unimpeded flow of capital, people, and ideas across national borders"
• Three groups of scholars argue that existing accounts of globalization are incorrect and imprecise:

  • The first group disagrees with the usefulness of globalization as a precise analytical concept
  • The second group contends that the world is not really integrated as many proponents believe
  • The last cluster disputes the novelty of the process while acknowledging the presence of moderate globalizing tendencies
• Rejectionist scholars believe that the term "globalization" is an example of a vague word employed in academic discourses, similar to "nationalism"
• Sceptics stress the limited nature of current globalizing processes
• Modifiers suggest that "globalization" has often been applied in a historically inaccurate manner
• Globalization as an Economic Process:

  • The evolution of global markets and international corporations led to global economic interdependence among nation-states
  • The development of international economic institutions such as the European Union, the North American Free Trade Association, and other regional trading blocs are examples
• Results show that economic globalization increases the linkage of national economies through trade, financial flows, and foreign direct investment (FDI) by multinational or trans-national corporations
• Foreign Direct Investment (FDI) is the purchase of an interest in a company by an investor located in another country

  • Transnational corporations (TNCs) or multinational corporations (MNCs) are companies that operate in more than one country, such as Unilever, McDonalds, and Apple
• Globalization as a Political Process includes the discussion and analysis of political processes and institutions

  • According to Ohmae (1990, 1995, 2005), the rise of a "borderless world" was the consequence of the irresistible forces of capitalism
• Globalization as a Cultural Process:

  • According to Tomlinson (1999), cultural globalization signifies a growing linkage of intricate cultural interconnections and interdependencies that define modern social life
  • McDonaldization is the process by which the principles of the fast-food restaurant dominate more sectors of North-American society
• Market Globalism:

  • During the early 1990s, the emphasis of globalization was dominated by the economic and technological features of globalization
• Political Ideologies and the Global Imaginary:

  • "Ideology" is a structure of broadly shared ideas or philosophies, patterned beliefs, guiding norms, values, and ideals recognized as fact by some collections of people
  • The concept of "ideology" was first introduced by Antoine Destutt de Tracy in the 18th century
• Global Commodity Chains:

  • There is a growing significance of international buyers in a global market of dispersed production
• The process of globalization began when Homo sapiens started moving from the African continent to the rest of the globe
• Globalization dates back about 5,000 years ago as manifested by the Silk Road which linked Asia, Africa, and Europe
• The real global economic breakthrough came in the 19th century due to transport innovations via the use of steamships and railroads which decreased transaction expenses and boosted both local and global economic exchanges
• The Golden Age of Globalization:

  • Short period from 1870 to 1913 before World War I
  • Characterized by the presence of peace, free trade, and financial and economic permanence
• The Neoclassical Solow Growth Model:

  • The industrial revolution and global trade relations strengthened economic growth and development among developed parts of the globe
  • The rest of the world did not achieve such accomplishments
• Structuralism:

  • Globalization is taken for granted and seen as a manifestation of some deterministic logic
• The International Monetary System denotes the policies, practices, tools, services, and institutions for carrying out global payments
• The Gold Standard operated as a fixed exchange rate system, which made gold as the lone global reserve
• The Bretton Woods System:

  • Set of unified rules and policies that provided the framework necessary to create fixed international currency exchange rates
  • Gold was the basis for the U.S. dollar and other currencies were pegged to the U.S. dollar's value
  • Negotiated in July 1944
  • In 1971, President Richard M. Nixon devalued the U.S. dollar relative to gold
  • By 1973, the Bretton Woods System collapsed
• The Plaza Accord:

  • In 1985, the G5 countries decided to devalue the US dollar to reinstate global competitiveness in the world market
• The Louvre Accord:

  • In 1987, the Louvre Accord was agreed upon to protect the US dollar from further devaluation in the world market
• The Washington Consensus refers to a belief that developing countries should adopt market-led development strategies for economic growth
• The Morgenthau Plan aimed to downscale Germany's economy to become pastoral and agricultural
• The Marshall Plan and the European Monetary Integration:

  • United States' post-war reconstruction and development program in 1948 for Western Europe
  • Aimed at the formation of a common market for the freer movement of goods, services, capital, and labor
  • Included EMS (European Monetary System) and European Exchange Rate Mechanism (EERM)
• Comparative Advantage Theory states that every country must possess a comparative advantage in the production of something irrespective of its original situation
• Multilateralism is the process of organizing relations between groups of three or more states
• GATT (General Agreement on Tariffs and Trade) aims to minimize barriers to international trade by eliminating or reducing quotas, tariffs, and subsidies
• WTO (World Trade Organization) aspires for free trade by binding its Members with international commitments in terms of access to the goods and services markets, economic policy instruments affecting trade, and state support of agriculture
• Market Integration:

  • The Rise of Global Corporation in historical globalization
  • International Companies import and export but have no investments outside of their country
  • Multinational Companies invest in foreign countries but do not possess coordinated commodity offerings in every nation
  • Global Companies invest in an area existing in many countries and sell their goods and services to each local market
  • Transnational Companies are complex corporations and have invested in foreign nations
• Digitalization is innovating the usual value chain of manufacturing centered on improvement
• The Global Corporate Development:

  • BRICS (Brazil, India, China, and South Africa) became the most vibrant region of international corporate growth
  • Emerging Market Global Corporations include companies like Basic Element (Russia), Bharat Forge (India), BYD Company (China), CEMEX (Mexico), China International Marine Containers Group (China), Cosco Group (China), Embraer (Brazil), Galanz Group (China), Hisense (China), Johnson Electric (China), Nemak (Mexico), Sistema (Russia), Tata Chemicals (India), Techtronic Industries Company, and Wipro (India)
• Homogeneity means all the same
• Heterogeneity means diverse/different
• Laissez-Faire means allow to do