M1 Lesson 2
M1 Lesson 2
Lesson 2
Globalization and its Impact on Political and
Economic world
Learning Outcomes
Introduction
The advent of globalization in the 1970s had affected greatly the academic world
as it immediately gained the interest and attention of most social scientists, who
were occupied with social phenomena related to globalization. The impact can be
seen in the surge of scholarly works about globalization. Over the years, the
literature on globalization has been enhanced with the inclusion of new research
areas and topics, such as studies on transnational sexualities, global tourism, and
evolution of state institutions, the restructuring of work and the improvement of
working conditions, transnational care-giving, and the global media to name a few.
Clearly, the wide array of globalization-related research topics that scholars can
choose from points to the ubiquity of the effects of globalization (Appelbaum and
Robinson, 2005).
By way of reiteration, the increasing literature on globalization reflects the enormity
of human activities that can be studied. Also, it shows the extent of globalization’s
impact on human lives; it shows how different we have become compared to our
predecessors in terms of the level of superiority, sophistication and
cosmopolitanism. The globalization literature suggests that there are two major
branches of research: (1) those studying specific problems or issues as they relate
to globalization; (2) those studying the concept of globalization itself – theorizing
the very nature of the process. Both areas entail a great deal of theorizing in order
to make sense of the various phenomena comprising globalization. How do we
theorize on this phenomenon that we call globalization? What types of theories
have been developed to explain social change in the 21 st century? Are the major
theories of the traditional social science disciplines adequate to explain the various
phenomena within globalization? Or, do we need new theoretical models?
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What impact are economic development and rapid population growth having
on the environment?
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A key structure of the capitalist world-system is the division of the world into
three great regions, or geographically based and hierarchical organized tiers.
The first is the core, or the powerful and developed centers of the system,
originally comprised of Western Europe and later expanded to include North
America and japan. The second is the periphery, those regions that have been
forcibly subordinated to the core through colonialism or other means, and in
the formative years of the capitalist world-system would include Latin America,
Africa, Asia, the Middle East and Eastern Europe. Third is the semi-periphery,
compromised of those states and regions that were previously in the periphery
and are moving up. Another key feature of this world-system is the centrality
and immanence of the inter-state system and inter-state rivalry to the
maintenance and reproduction of the world-system. The world-system
paradigm does not see any transcendence of the nation-state system or the
centrality of nation-states as the principal component units of a larger global
system.
2. Global Capitalism Paradigm. The theories under this school of thought treat
globalization as a novel stage in the evolving system of world capitalism. As
such, globalization has its own unique features that distinguish it from earlier
periods. They focus on new global production and financial system; both are
seen to have superseded earlier national forms of capitalism. They also
emphasize the rise of processes that cannot be framed within the nation-
state/inter-state system, which lies at the core of the world-system theory and
most traditional macro-social theories. The seminal studies of Sklair (2000,
2002) have showcased the theory of the global system which espoused the
transnational phenomena. His theory argues that the TCC has emerged as a
new class that brings together several social groups who see their own interest
in an expanding global capitalist system: the executives of transnational
corporations; globalizing bureaucrats, politicians, and professionals, and
consumerist elites in the media and the commercial sector (Sklair, 2000).
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and local communities, in ways quite distinct from the old national class
structures and international class conflicts and alliances.
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Giddens (2000) argued that the driving force behind globalization is the
information revolution. "Instantaneous communication changes almost
everything. It invades the texture of everyday life, but it also provides for the
restructuring of other institutions." The outcome is a highly complex set of
processes that often take contradictory shapes, but one can simplify the
concept with a three-fold image. Globalization pulls away from the nation-
state, removing control from national governments in such areas as
economic and trade policy. But globalization also pushes down from the
state, allocating new resources for local economies, facilitating the
emergence of local cultural identities, and strengthening sub-national units
of governance. Finally, globalization squeezes sideways, creating new
cultural, economic, and political regions that cut across national boundaries.
Another key figure in the globalization theories involving space and time is
Saskia Sassen’s The Global City (1991), which has had an exceptionally
broad impact across the disciplines and left an indelible mark on the
emergent field of globalization studies. His study is grounded in a larger
body of literature on world cities that view world-class cities as sites of a
major production, finances, or coordinating of the world economy within an
international division of labor, and more recent research on ‘globalizing
cities’. Sassen proposes that a new spatial order is emerging under
globalization based on a network of global cities. These cities are sites of
specialized services for transnationally mobile capital that is so central to
the global economy.
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Example: One of the most fruitful areas of study has been transnational
migration. Research in this area looks at issues such as the salient
interaction with the receiving society’s institutions, the migration
policies of states, the role of discrimination in limiting access to the
institutions of the receiving society’s civil society, access to computers
within the home and receiving societies, and the costs and other
hardships that affect groups of migrants (Kivisto 2001). A growing
research agenda concerns the emergence of civil society, state, and
non-state organizations, developed in order to respond to issues of
transnational immigration. Identity is continually challenged by the fluid
legal and social characterizations of migrants created and adapted to
local, national, and international organizations.
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resultant global cultural flows and images in recent decades, evoking the
image famously put forth by Marshall McLuhan of ‘the global village’.
Cultural theories of globalization have focused on such phenomena as
globalization and religion, nations and ethnicity, global consumerism, global
communications and the globalization of tourism. For instance, Ritzer (1993,
2002) coined the now popularized term ‘McDonalization’ to describe the
sociocultural processes by which the principle of the fast-food restaurant
came to dominate more and more sectors of US and later world society.
Ritzer, in this particular homogenization approach, suggest that Weber’s
process of rationalization became epitomized in the late 20th century in the
organization of McDonald’s restaurants along seemingly efficient,
predictable and standardized lines – an instrumental rationality (the most
efficient means to a given end) – yet results in an ever deeper substantive
irrationality, such as alienation, waste, low nutritional value and the risk of
health problems, and so forth.
These mentioned approaches are just some of the major theoretical underpinnings
that seek to provide a clear conceptualization of globalization. While it cannot be
denied that the formulation of these theories have resulted in seemingly endless
academic debates centered on the correct way of interpreting globalization, they
have also helped us in correcting some of the wrong notions and misconceptions
about globalization. The discussion that follows is focused on these
misconceptions.
NOTE: for theoretical paradigms please refer to the file attached (re: Theories of
Globalization.pdf)
Scholte (2008) in his attempt to clarify the meaning of globalization, criticizes the
several flawed analyses of globalization pointing out that they end in failure to
produce new knowledge. In other words, he defines globalization by telling us what
it is not. Below are the misconceptions of globalization.
a. Globalization as internationalization
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b. Globalization as liberalization
Let us talk of the impact of trade on employment level and structure in the
Philippines as example of this analysis. While globalization is regarded as a key
to economic development, it is also argued that it increases concerns on poverty,
threatens employment and living standards of the poor. Similar to many other
developing countries, Philippines also attempted to integrate its economy in the
global economy through liberalizing its investment and trade regime within the
framework of the World Bank and the IMF. A review of literature specifies that
although a number of cross-country studies have shown a positive association
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between trade openness and economic growth, the recent work suggests that
openness has robust link with long-term growth from the 1990s to 2010s
globalization indicators. Thus, constructive effects of liberalization on growth
remain controversial. Evidence shows that numerous highly attractive incentives
offered to foreign investors, Philippines' performance in attracting the foreign
investment has been improved. Also, despite the intensive trade liberalization, the
trade performance has been sufficient, though the stabilization initially proved to
be short-lived due to the slippages in reform procedure transpired in the form of
range of tax exemption and concession leading to the execution and
implementation of further stabilization methods. The recurrent efforts to stabilize
the economy together with liberalization and persistent devaluation of domestic
currency pushed the economy in a good circle. These developments together with
liberalization contributed to higher per capita GDP growth in the Philippines,
reduction in income inequality, and lower unemployment, but has no significant
impact on the reduction of poverty during the period of liberalization. This outcome
is a consideration of the fact that Philippines was asked by the IMF to cut its tariff
rates quickly before adopting to a new system of domestic taxation. The structural
adjustment programs designed by the World Bank/IMF take the poverty as a
residual issue. Hence, existing anti-poverty programs in Philippines reached a
small fraction of the poor because of poor targeting. Thus, for future growth and
poverty reduction strategies, the issue of achieving higher growth must be mutual
with overall pattern of social progress and distribution.
The problem with this, Scholte explains that it confines the study of globalization
within the debate concerning the neoliberal macroeconomic policies. On the other
side of the discussion are the business executives, academics and policymakers
that have supported neoliberal policies of liberalization, privatization, deregulation,
and fiscal restraint would in time bring prosperity, freedom, peace and democracy
for all. And on one side, the critics in the so-called anti-globalization movement
have opposed neoliberal policies arguing that a laissez faire world economy
produces greater poverty, social conflict, inequality, cultural destruction,
democratic deficits and ecological damage (Ibid: 1475). In addition, this
misconception carries with it a political implication – that neoliberalism is the only
available policy framework for a truly global world. Finally, debates about the
advantages and disadvantages of laissez faire economics have gone on for
centuries without involving the language of globalization.
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both claims (processes and projects) is the issue of “identity” since both spheres
agree that the concept of “identity” has passed a series of changes and
developments, although each one renders the path and goal of “identity” changes
by its own specific interpretations.
While some thinkers like Giddens (1991), Wallerstein (1999), Bhawuk (2002),
Sklair (1994-1999), and others consider expanding communication and access to
information as a modern phenomenon, Robertson (1992), Waters (1995), and Held
(1999) believe that the history of this situation goes back to pre-modernity era. In
this regard, it can be traced that various definitions and conflicting views have been
insisted on massive expansion of communication along with the broad and rapid
access to information. Universalization denotes a process of spreading various
objects, practices, and experiences to the different parts of the planet. Hence, there
is globalization when things, values, and practices have spread worldwide. This
interpretation of globalization entails homogenization of culture, politics, economy,
and laws. As homogenization progresses, globalization destroys several
indigenous cultures and practices. If Western modernity spreads and destroys
local cultures, this variant of universalization is known as Westernization, neo-
colonialism, Americanization, or McDonalidazation.
Scholte (2008) notes that there are issues arising from these misconceptions. First,
universalization is not a new feature of world history. The migration of the human
species that took place a million years ago is one great example of globalization in
the ancient times. The continuous spread of the major religions like Christianity
and Islam since their foundation constitutes another instance of globalization which
is not confined to contemporary period.
This is how Karl Marx and Friedrich Engels described in 1909 the modernization
of industry, trade and consumption - in a word “civilization”, which they perceived
as an expression of the progressive role of bourgeoisie in history:
“The need of a constantly expanding market for its products chases the
bourgeoisie over the entire surface of the globe. It must nestle everywhere,
settle everywhere, and establish connections everywhere.
The bourgeoisie has through its exploitation of the world market given a
cosmopolitan character to production and consumption in every country. To
the great chagrin of Reactionists, it has drawn from under the feet of industry
the national ground on which it stood. All old/established national industries
have been destroyed or are daily being destroyed. They are dislodged by
new industries, whose introduction becomes a life and death question for all
civilized nations, by industries that no longer work up indigenous raw
material, but raw material drawn from the remotest zones; industries whose
products are consumed, not only at home, but in every quarter of the globe.
In place of the old wants, satisfied by the production of the country, we find
new wants, requiring for their satisfaction the products of distant lands and
climes. In place of the old local and national seclusion and self-sufficiency,
we have intercourse in every direction, universal interdependence of
nations. And as in material, so also in intellectual production. The intellectual
creations of individual nations become common property. National
one/sidedness and narrow-mindedness become more and more impossible,
and from the numerous national and local literatures, there arises a world
literature.
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Second, westernization is not only path that can be taken by globalization as shown
by the studies on oriental globalization. From the fact that the term of
westernization was shaped by an American (the sociologist Daniel Lerner, from
the Massachusetts Institute of Technology), to the today’s explosion of Internet and
of all services afferent thereto (that are used in English language and convey the
values of the “American lifestyle”). The Westernization of the world unfolded in a
constant rhythm and in spite of the Soviet opposition; as a matter of fact, the very
denouement of the Cold War must be seen as a product of the “westernization of
the world”. But many people prefer to talk about the “Americanization of the world”,
leading to the anti-American reactions.
Please check:
Marx, Engels, Manifesto of the Communist Party, ed. a IX-a, Political Publishing
House, Bucharest,1969, p. 40-41.
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