GLOBALIZATION: organization, linking together and

the process by which businesses, expanding human activity across

cultures, technologies, and ideas from regions and continents
different parts of the world become • a satisfactory definition of
interconnected and interdependent. globalization must address each of
Charles Russel Tazel- A near-term "giant these items: EXTENSION,
corporations" was used in 1897 to INTENSITY, CELERITY AND IMPACT
describe the big national trusts and other • Thomas Larsson, The Race to the
large enterprises of the time. Top: The Real Story of
Vladislav Inosemtsev- “one of the most Globalization: globalization is the
popular social studies of today, but is at process of the shrinking of the
the same time an empty term” world, the shortening of distances,
Roland Robertson- "the understanding and the closeness of things
of the world and the increased • In 2000 the International Monetary
perception of the world as a whole” Fund has identified four basic
Martin Albrow and Elizabeth King- "all aspects of globalization: (1) trade
those processes by which the peoples of and transactions, (2)capital
the world are incorporated into a single
movements and investment,
world society”
(3)migration and (4)movement of
David Held- "rapid global
people and the spreading of
interconnection, deep and on large
knowledge
scale, such definition but requires now a
more complex research“ PROS
Proponents of economic growth,
• can be linked to the local, the expansion and development in general,
national and the regional see the globalization processes as
• a connection is made between desirable and necessary for the good of
social and economic human society
relationships and networks, CONS
organized on a local and / or Critics see one or more processes of
national globalization as detrimental (harm) to
• it connects social and economic social welfare on a global or local scale
relationships and networks
crystallized on wider scale the
regional and global interactions
• spatial-temporal processes of
change, which constitutes the
fundament of the transformation
of human concerns in an
KEY ASPECT OF GLOBALIZATION
-Globalization is usually used as a handy
form to describe the spread of
communication production and
connection technologies throughout the
world
-Most often, the term globalization is
used in a confusing manner with respect
to the efforts of IMF, World Bank and the
institutions to create a free global
market for goods and services.
-With the increase of economic
interconnection, the political changes
have deepened - the poorer "peripheral"
countries became more dependent of the
"central" or “core” economies , such as
U.S., where capital and technical
expertise tend to be blocked.

CORE
• Powerful developed center
• Higher skill and capital and
intensive production
• Military strong
• Western Europe, North America,
5 VECTORS OF GLOBALIZATION
Japan
The globalization has 5 vectors that act on
PERIPHERY
human society, vectors that influence the
• Low skill
development of human society. The
• Labor intensive production and
vectors through which globalization
extraction of raw materials
interacts with society, both locally,
• Subordinated to the core through
regionally, and internationally are: the
colonialism
(1)economic vector,
• Weak states
(2) the military vector,
• Africa, Asia, Middle East
(3)the political vector,
SEMI-PERIPHERY
(4)the religious vector and
• Less dependent on the core
(5) the cultural vector
• More diversified economies
• India and Brazil
IMPACTS OF GLOBALIZATION STRUCTURING THE ECONOMY
1.Delocalization and over-territoriality
economic activities is global - that means
that there is the ability to work in union, in
real-time or at a certain time, on a
planetary scale. Many activities that
implied prior a face-to-face interaction or
had local character would now be
conducted from distance.
2. The decline of the power of national
governments
policies everywhere are now essentially
market driven. It means not only that
the governments cannot "manage"
national economies, but also that, in
order to survive in their office, they have
to increase their ability to drive national
policies in such way as to be adapted
to the pressures of transnational
market forces
3. The emergence of global brands
and institutions
Multinationals can affect communities
in different locations and areas. Firstly,
they seek to establish or contract
manufacturing, service and sales
operations in countries and regions
where they can exploit the cheapest
labor and the cheapest resources.
*Note: there are different standards of • Policies of international
living around the world, we can expect organizations like the UN
different meanings attached to it. • The greatest contributor:
• Living in poverty: 275 pesos a day ECONOMIC GLOBALIZATION
or 100,534 pesos a year (poverty • The worlds economies have
threshold) become more interconnected
• Extreme poverty according to UN and free trade has driven the
(2015) is characterized by severe growth of many developing
deprivation of basic human needs, economies
including food, safe drinking water, What is Economic Globalization?
sanitation facilities, health, Internationalization- The extension of
shelter, education and information economic activities of nation states
across borders.
The UN (2015) reported that 836 million Economic Globalization- The functional
people still live in extreme poverty but integration between internationally
that is down from 1.9 billion, so there is dispersed activities.
success or at least a lot of progress
ECONOMIC GLOBALIZATION and
The World Bank predicted that by 2030, GLOBAL TRADE
the number of people living in extreme “It is a historical process, the result of
poverty could drop to less than 400 human innovation and technological
million . Of course that assumes progress. It refers to the increasing
everything will keep improving as it has integration of economies around the
been. Climate change has to be world, particularly through the
considered since it is a threat to these movement of goods, services, and
improvements in global poverty capital across borders…”
(IMF, 2008)
Most people who have been lifted out of
extreme poverty are still poor and being “In economic terms, globalization is
poor comes with serious problems, nothing but a process making the world
from disease to lack of water, income economy an “organic system” by
inequality is rampant and one in seven extending transnational economic
people still live without electricity processes and economic relations to
more and more countries and by
Set of factors: deepening the economic
• Better access to education interdependencies among them.”
• Humanitarian aid Szentes (2003)
WHAT IS ECONOMIC GLOBALIZATION? preferential treatment to
▪ Refuses the assumption that the domestic producers and
nation (state) is the only unit of discriminating against foreign
analysis and that current trends. competitors (McAleese, 2007)
▪ It claims that economic activities 2. TRADE LIBERALIZATION OR FREE
and processes can be interpreted TRADE- is a policy formed
in a global context. between two or more nations that
▪ Consumption of highly permits the unlimited import or
standardized globalized products export of goods or services
and services. between partner nations. Free
▪ National products into global trade eliminates tariffs and
product. makes corporations more
▪ On the other hand, globalization competitive in foreign markets.
redefined the role of the nation
state as an effective manager of TYPES OF PROTECTIONISM
the national economy. 1. Tariffs
(Boyer&Drache, 1996) The taxes or duties imposed on imports
▪ New actors appear are known as tariffs. Tariffs increase the
▪ The major players of present day price of imported goods in the domestic
economy are the Transnational market, which, consequently, reduces
Corporations (TNC’s) the demand for them.
▪ TNC’s are constantly evolving. 2. Quotas
Dimensions of Economic Globalization: Quotas are restrictions on the volume of
a. The globalization of trade of goods imports for a particular good or service
and services over a period of time. Quotas are known
b. The globalization of financial and as a “non-tariff trade barrier.” A
capital markets constraint on the supply causes an
c. The globalization of technology increase in the prices of imported goods,
and communication reducing the demand in the domestic
d. The globalization of production market.
3. Subsidies
Two types of economic globalization: Subsidies are negative taxes or tax
1. PROTECTIONISM- a policy of credits that are given to domestic
systematic government producers by the government. They
intervention in foreign trade with create a discrepancy between the price
the objective of encouraging faced by consumers and the price faced
domestic production. This by producers.
encouragement involves giving
4. Standardization to protect U.S. automakers
The government of a country may require remains in effect today.
all foreign products to adhere to certain
guidelines.
In the final analysis, the goal of business
FREE TRADE is to realize a higher profit, while the
• North American Free Trade goal of government is to protect its
Agreement (NAFTA), between the people. Neither unrestricted free trade
United States, Canada, and nor total protectionism will accomplish
Mexico is one of the best-known both
Free Trade Agreement (FTA)
• FTAs with other nations which
determine the tariffs, duties, and
subsidies the countries can
impose on their imports and
exports
• In 1948, the United States along
with more than 100 other
countries agreed to the General
Agreement on Tariffs and
Trade (GATT), a pact that reduced
tariffs and other barriers to trade
between the signatory countries
• In 1995, GATT was replaced by
the World Trade
Organization (WTO). Today, 164
countries, accounting for 98% of
all world trade belong to the
WTO.
• most governments still impose
some protectionist-like trade
restrictions such as tariffs and
subsidies to protect local
employment
• “Chicken Tax,” a 25% tariff on
certain imported cars, light trucks,
and vans imposed by
President Lyndon Johnson in 1963