Diff Between Economic and Political Globalisation

• Paragraph one Point of difference:

  • economic globalisation is driven primarily by the desire for profit and economic growth,
  • whilst political globalisation is driven and was founded on upholding ideals such as human rights, equality and peace
• paragraph one economic globalisation

  • Rather than being driven by nation states and their leaders like political globalisation, economic globalisation was also driven by private companies, especially MNCs
  • MNCs desire for profit led to economic globalisation as global supply chains allowed them to take advantage of cheap labour and large export markets. This was also then supported by Western governments as the growth of these MNCs boosted their GDP.
  • For example, Nikeʼs use of offshore production in Southeast Asia enables the company to take advantage of lower labour costs in countries like Vietnam, where its factories employ over 500,000 workers
• paragraph one political globalisation

  • By contrast, political globalisation was driven by European and North American statesʼ desire to promote liberal values including human rights, democracy and peace.
  • The International Criminal Court was created in 2002 to promote human rights and justice by holding individuals accountable for crimes such as genocide and war crimes.
  • States have no economic incentive to create this international institution, but did so to uphold human rights and peace globally.

  Similarly, the European Union, although partly motivated by economic integration, was also established and has expanded in the 21st century to promote democracy, liberal values, and peace in Europe.

  For example, its expansion in the early 2000s included countries like Poland and Hungary, where membership was tied to adopting democratic reforms and upholding the rule of law.
• Paragraph two point of difference:

  Another difference is their impact on the internal sovereignty of nation-states. Whilst both reduce state sovereignty, economic globalisation arguably does so to a much greater extent than the international institutions of political globalisation, which have limited enforcement mechanisms.
• paragraph two economic globalisation:

  • Economic globalisation has made each countryʼs economy deeply connected to other countries/MNCs and therefore dependent on their decisions.
  • This has permanently reduced the sovereignty government have over their national economies and extent to which they can control them.
  • MNCs and global trade networks have limited the ability of governments to control their countryʼs labour markets, which are very dependent on how MNCs decide to structure their supply chains.
  • In the 1990s, for example, Ford shifted parts of its manufacturing operations from the UK to Eastern Europe to reduce labour costs, leading to the closure of several UK factories and significant job losses in the British auto industry.
• paragraph two Political Globalisation

  • By contrast, political globalisation hasnʼt led to such a significant loss of sovereignty for the vast majority of countries.
  • Though countries have been willing to engage with and work through international organisations such as the United Nations and ASEAN, they have been largely unwilling to give up any veto powers over decisions, therefore maintaining their sovereignty.
  • A clear example of this is the majority of the worldʼs supranational institutions, including ASEAN, the Arab League and African Union, which have created free trade areas, but have been unwilling to become supranational institutions like the European Union.
  • Instead, they have maintained as intergovernmental organisations where each state retains veto power and sovereignty.
• Paragraph three point of difference:

  A final key difference is that economic globalisation often creates conflict and competition between states, whilst political globalisation is designed to resolve this conflict and promote cooperation.
• Paragraph three economic globalisation:

  • Economic globalisation create conflict between large states in particular, as they compete for global economic power through access to markets, resources and dominance in important sectors such as renewable energy and technology.
  • For instance, the US China trade war, which began in 2018, resulted in tariffs on over $550 billion worth of goods, disrupting global supply chains and escalating tensions between the two largest economies.
  • Similarly, competition for rare earth metals, which are essential for high-tech industries like electronics and defence, has intensified, with China producing over 70% of the global supply, prompting the US to invest in alternative sources in Australia and Canada to reduce reliance and maintain strategic autonomy.
• Paragraph three political globalisation:

  By contrast, political globalisation seeks to resolve conflicts and foster cooperation. IGOs play a central role in giving countries a framework to resolve disputes and work to tackle shared challenges.

  WTO provides a platform for resolving trade disputes between nations through its Dispute Settlement Body (DSB), helping to prevent trade wars and ensure fair competition. It has handled over 600 disputes since its establishment.

  Similarly, the Paris Agreement shows how political globalisation can unite countries to combat shared challenges. The agreement was signed at COP21 and committed 196 countries to limit global warming.

  Without the United Nations Framework Convention on Climate Change, this international political cooperation almost certainly wouldnʼt have happened.