UNIT-3

Unit-3
Globalization
Topics:
• Meaning
• Definition and Features
• Advantages and disadvantages
• Types: Political, Economical, Social and legal
• Implications
• GATT and WTO
CONCEPT OF GLOBALIZATION: Case I
Abhishek works in a call centre. He leaves late in the evening
for work, becomes Abhi when he enters his office, acquires a
new accent and speaks a different language (than he does
when he is at home) to communicate with his clients who
are living thousands of miles away. He works all night, which
is actually day time for his overseas customers. Abhishek is
rendering a service to somebody who in all probability he is
never likely to meet physically. This is his daily routine. His
holidays also do not correspond to the Indian calendar but to
those of his clients who happen to be from the US.
 Case II
Ram has gone shopping to buy a birthday gift for his
nine-year old daughter. He has promised her a small
cycle and decides to search the market for something he
finds affordable as well as of reasonable quality. He
finally does buy a cycle, which is actually manufactured
in China but is being marketed in India. It meets his
requirements of quality as well as affordability, and Ram
decides to go ahead with his purchase. Last year, Ram on
his daughter’s insistence had bought her a Barbie doll,
which was originally manufactured in the US but was
being sold in India.
CASE III
Savika is a first generation learner who has done remarkably well
throughout her school and college life by working very hard. She now
has an opportunity to take on a job and begin an independent career,
which the women of her family had never dreamt of earlier. While
some of her relatives are opposed, she finally decides to go ahead
because of the new opportunities that have been made available to
her generation.
Negative Impact
• Some farmers committed suicide because their crops failed. They had
bought very expensive seeds supplied by a multinational
company(MNC).
• A film producer in Mumbai was accused of lifting the story of his film
from another film made in Hollywood.
• Many retail shopkeepers fear that they would lose their livelihoods if
some major international companies open retail chains in the
country.
Definition:
• Globalization can be defined as ” the increased interconnectedness and
interdependence of peoples and countries. It 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.”-WHO
• Globalization as a concept fundamentally deals with flows. These flows
could be of various kinds — ideas moving from one part of the world to
another ,capital shunted between two or more places, commodities being
traded across borders, and people moving in search of better livelihoods to
different parts of the world. The crucial element is the ‘worldwide
interconnectedness’ that is created and sustained as a consequence of
these constant flows.
Types of globalisation

• Political and legal globalisation

• Social and Cultural globalisation
• Economic globalisation
 Political Globalization
• "Political globalization refers to the growing power of institutions
of global governance such as the World Bank, the International
Monetary Fund (IMF) and the World Trade Organization (WTO). But it
also refers to the spread and influence of international
non-governmental organizations, social movement organizations and
transnational advocacy networks operating across borders and
constituting a kind of global civil society. Wikipedia
Political Globalization
• United Nations(UN)
• International Monetary Fund(IMF)
• World Bank
• World Trade Organization(WTO)
 Political Globalization: UN
• The United Nations (UN) is an intergovernmental organization
founded in 1945 that aims to maintain international
peace and security, develop friendly relations among nations,
achieve international cooperation, and a centre for harmonizing
the actions of nations.
• It is the largest, most familiar, most internationally represented
and most powerful intergovernmental organization in the
world.
• The UN is headquartered on international territory in New York
City, with its other main offices
in Geneva, Nairobi, Vienna and The Hague.
• The member nations are India, Pakistan,
Argentina, Australia, Belgium, Bolivia, Brazil etc

Source:https://en.wikipedia.org/wiki/Member_states_of_the_United_Nations
Cultural Globalization
How Culture Globalization evolves?: The 3 H
scenarios
• Heterogenization scenario
• Homogenization scenario
• Hybridization scenario
Cultural globalization
• Cultural globalization refers to the transmission of ideas,
meanings, and values around the world in such a way as to
extend and intensify social relations.
• It brings increasing interconnectedness among overview
CAGE model discussed
through class activity
Discussions for today
• Why was it formulated?
• What are the main organs of United Nations?
• Who are the member states of UN?
• When India joined UN?
• What are the roles performed by specialized agencies like
UNDP,UNEP,UNFPA, ILO etc.?

Source: https://www.un.org/en/about-un/
 International Monetary Fund
The International Monetary Fund (IMF) is an international
organization that aims to accomplish a number of different goals.
These include reducing global poverty, encouraging international
trade, and promoting financial stability and economic growth. The
organization was created in 1945 and is based in Washington, DC.
There are a total of 189 member countries, each of which is
represented on the group's board.
The IMF functions in three main areas:
• Overseeing the economies of member countries.
• Lending to countries with balance of payments issues.
• Helping member countries modernize their economies.
Source: https://www.imf.org/en/About
 World Bank
• It helps the underdeveloped countries by granting development loans.
• It also provides loans to various governments for irrigation, agriculture, water
supply, health, education, etc.
• It promotes foreign investments to other organizations by guaranteeing the
loans.
• Also, the world bank provides economic, monetary, and technical advice to the
member countries for any of their projects.
• Thus, it encourages the development of of-industries in underdeveloped
countries by introducing the various economic reforms.
• Currently, the membership of the world bank is given to 189 countries under
IBRD and 173 countries under IDA.
• Organizations like MIGA, IFC, and ICSID manages the World bank.
Source: https://www.worldbank.org/
 World Bank Group
The World Bank Group is an extended family of five international
organizations, and the parent organization of the World Bank, the
collective name given to the first two listed organizations, the IBRD and
the IDA:
• International Bank for Reconstruction and Development (IBRD)
• International Development Association (IDA)
• International Finance Corporation(IFC)
• Multilateral Investment Guarantee Agency (MIGA)
• International Centre for Settlement of Investment Disputes(ICSID)
Source: https://www.worldbank.org/en/about
 World Trade Organization
The World Trade Organization (WTO) is the only
international organization dealing with the global
rules of trade. Its main function is to ensure that
trade flows as smoothly, predictably and freely as
possible.
• Administering WTO trade agreements.
• Providing forum for trade negotiations.
• Handling trade disputes.
• Monitoring Members’ trade policies.
• Providing technical assistance and training to
developing and least developed economies.
• Cooperating with other international organizations.
Source:
https://www.wto.org/english/thewto_e/thewto_e.htm
Economic Globalization
• Economic globalization refers to the increasing interdependence of
world economies as a result of the growing scale of cross-border
trade of commodities and services, flow of international capital and
wide and rapid spread of technologies.
Economic Globalization

Ford's Dunton Technical Centre in Laindon, United

Kingdom, the largest automotive research and
development facility in the country.

Ford has had

manufacturing operations worldwide,
including in the United States, Canada,
Mexico, China, India, the United The Ford Research Center
in Aachen, Germany.
Kingdom, Germany, Turkey, Brazil,
Argentina, Australia, and South Africa.
The garment industry in Bangladesh makes
clothes that are then shipped out across the
world. It employs as many as four million people,
but the average worker earns less in a month than
a U.S. worker earns in a day.

80 percent of American and European

clothing companies planned to move
their outsourcing from China, where
wages had risen, and were considering
Bangladesh as the "next hot spot"
making it the "next China“.

IFC & International Labor Organization(ILO)

also worked with the Bangladeshi
government to design and implement
policies, laws, and regulations to streamline
the process.
Agreements
• North American Free Trade Agreement (NAFTA)/USMCA
• ASEAN
ASEAN plus three
ASEAN plus six
https://ustr.gov/usmca
The purposes of ASEAN(Association of south East Asian Nations)are to
accelerate economic growth, social progress, and cultural development in
the region, to promote regional peace, collaboration and mutual
assistance on matters of common interest, to provide assistance to each
other in the form of training and research facilities, to collaborate for
better utilization of agriculture and industry to raise the living standards
of the people, to promote Southeast Asian studies and to maintain close,
beneficial co-operation with existing international organizations with
similar aims and purposes.
Formulated in 1999 with the aim to discuss policy pertaining to the promotion
of international financial stability.
KOF Globalisation Index

• The KOF Index of Globalization is an index of the degree

of globalization of 122 countries. It was conceived by Axel Dreher at
the Konjunkturforschungsstelle of ETH Zurich in Switzerland. It
was first published in 2002, and covered the period from 1970 until
that year. A new version of it was published in 2017 and 2018.
• The index is based on three principal criteria: economic, political and
social.
References
• https://mail.google.com/mail/u/0/#inbox/QgrcJHrjCsmXCmMhgJqJFx
FSbbvpZXQKLpG?projector=1&messagePartId=0.1