7 GLOBALIZATION

• Political economy - The study of the interaction of politics and economics. As a topic, it focuses on the relationship between states and markets. As a method, it refers to the use of economic theories to understand and analyze politics.
• State-centric Political Economy

  1. Developed out of mercantilism
  2. Sometimes called economic nationalism
• Classical and Neoclassical Political Economy

  1. Based from the writings of Ricardo and Smith
  2. Based on liberal assumptions on human nature
• Marxist Political Economy

  1. Depicts capitalism as a system of class oppression

  Class is defined in terms of the individual’s economic power
• Two rival economic systems

  1. Capitalist Economy. based on private ownership and organized by the market itself (capitalist West)
  2. Socialism - state ownership and organized through a system of centralized economic planning (communist East)(Heywood notes that there is no such thing as pure capitalism or socialism).
• Enterprise capitalism (American business model) - pure capitalism; sees the market as a self-regulating mechanism.
• Social capitalism (Central and Western European model) - state intervention used to protect infant industries from rigors of foreign competition; a form of stakeholder capitalism - workers and community interests.
• State/Authoritarian capitalism (Japan, East, and Southeast Asian tigers) - state plays a crucial directive role; collective capitalism - capitalism without political liberalism (no individual but community).
• For Heywood, capitalism is the only viable basis for economic organization around the world, thus he excluded socialism in this part. Ofc he is a fucking liberal.
• Globalization is the emergence of a complex web of interconnectedness that means that our lives are increasingly shaped by events that occur and decisions that are made at a great distance from us.
• Economic globalization - no national economy is isolated; all economies are absorbed into an interlocking global economy
• Cultural globalization - information, commodities, and images produced in one part of the world becomes global; ‘flattenening out’ cultural differences among regions, nations, and individuals. (E.g. McDonaldization - the dominance of fast food industry)
• Political globalization - evident in the growing importance and influence of international organizations
• Capitalism - Viewed as either an economic system or ideology. As an

  economic system, it is a system of generalized commodity production.