GLOBALIZATION AND ITS EFFECT ON CULTURE

1. Definitions
- Globalization is the interlinking of national and regional cultures
economically, politically and culturally under the impact of international trade
and international trade organizations, such as the World Trade Organization
(WTO), the International Monetary Fund (IMF) and regional groupings such as the
EU, NAFTA, Asia- Pacific Economic Cooperation (APEC) and the Caribbean
Community (CARICOM).
Example: Samsung’s smartphone and semiconductor production exemplifies
globalization through its widespread R&D (research and development), component
sourcing, manufacturing, and distribution.
+ With R&D hubs in South Korea, the U.S., and India, Samsung designs key
components like Exynos processors in-house while sourcing globally for OLED
displays, memory chips, and batteries.

Example: Zara sources its materials from a global network of countries, balancing
cost, quality, and sustainability.
+ Cotton: rely heavily on India, China, Bangladesh, and the U.S
+ Polyester and other synthetic fibers: come from China, South Korea, and
Taiwan.
+ Linen: imported from Belgium and France.
+ Wool: mainly sourced from Australia, New Zealand, and Italy.
+ Leather: supplied from Italy, India and Pakistan.
+ Denim: come from Pakistan and Turkey.
- A global village was originally coined to illustrate that through the advancement
of electronic communications, the peoples of the world can now be as closely
linked as the people in a traditional village. This notion has now been enlarged to
include religion, trade, and migration, and the whole world is now seen by many
as a single community.
Example: During global events such as the COVID-19 pandemic, people from all
over the world were able to share experiences, advice, and resources online, allowing
communities to unite in ways that resemble the close-knit nature of a small village.
Through virtual platforms like Zoom, classrooms, conferences, and even family
gatherings moved online, showing how technology bridges geographical divides.

2. The components of globalization

2.1 Globalization of markets:
 - National markets have been merged into one larger marketplace. The
emergence of a global norm in terms of customer expectations has made it possible to
sell standardized goods all over the world.
Example: Starting in the U.S., McDonald's has expanded to over 100 countries,
with more than 39,000 outlets worldwide. McDonald's sells standardized products
like hamburgers, fries, and soft drinks but also adjusts its menu to suit local tastes.
For example, in India, where most of the population is vegetarian and religious
practices prohibit the consumption of beef, McDonald's offers items like the McAloo
Tikki (potato burger) and the Chicken Maharaja Mac instead of the traditional Big
Mac. This allows McDonald's to maintain its global brand identity while meeting
local market demands, clearly illustrating market globalization.
- Large multinational companies like Wal-Mart and ExxonMobil, along with
mergers like British Airways and Iberia, exemplify this trend.
2.2 Globalization of production:
Companies distribute production processes globally to benefit from cost and
quality differences across countries. This can boost local economies by creating
jobs and enhancing spending power.
Example: L'Oréal manufactures its products across various countries, including
France, India, Brazil, and China, leveraging the unique advantages of each location.
For instance, hair care products are often produced in Brazil, benefiting from its rich
supply of natural ingredients, while skincare products are developed in France,
renowned for its high-quality standards. By establishing factories close to key
markets, L'Oréal optimizes labor costs and quickly responds to global consumer
demands. This strategy not only reduces production costs but also facilitates the
company’s growth and brand expansion across diverse international markets.
2.3 Emergence of global institutions:
The emergence of global institutions, such as the WTO and IMF, has significantly
accelerated global trade, which has outpaced global output and led to increased
foreign direct investment. As trade barriers have decreased due to cross-border trade
and technological advancements, imports have penetrated industrialized nations,
heightening competition across various industries. The expansion of international
cooperation is evident in the transition from the G8 to the G20, highlighting the
benefits of greater diversity in addressing global challenges.
Example: The IMF, established in 1944, aims to maintain global financial
stability and assist in poverty alleviation, while the World Bank provides investment
capital for countries. The WTO facilitates trade agreements and regulates global
 trading systems, ensuring compliance among member states. China's admission to the
WTO in 2002 was expected to lead to significant economic reforms and increased
transparency in its business environment.
- Two Perspectives on Globalization Effects:

+ Pessimistic View: the gap between rich and poor increases

+ Optimistic View: Economic convergence is possible

 Two contrasting perspectives arise regarding globalization: one suggests that it
deepens the wealth gap, while the other believes it can lead to a more equitable
economy as global trade liberalizes.

7. Advantages and Disadvantages

7.1 Advantages of Globalization
- On the positive side, globalization can facilitate economic growth and job
creation. For instance, workers in LDCs often gain increased wages and employment
opportunities. Even in suboptimal working conditions, many individuals prefer having a
job over the prospect of unemployment.
Example: In India, the liberalization of the economy in the 1990s allowed for
increased foreign investment and trade. This led to the growth of the IT sector, creating
millions of jobs and significantly raising wages for many workers. Companies like
Infosys and Wipro have become global leaders, showcasing how globalization can
facilitate economic growth and job creation.
- Indeed, as former World Bank Chief Economist Joseph Stiglitz noted,
globalization has benefited millions, particularly in countries like India and China,
lifting hundreds of millions out of poverty by opening markets and providing access to
knowledge.
7.2 Disadvantages of Globalization
- However, globalization also has its drawbacks that cannot be overlooked. Stiglitz
notes that benefits from globalization are distributed unevenly.
Example: In many LDCs, especially in Africa, poverty remains prevalent due to
lack of resources and education. This is in stark contrast to countries like India and China,
which have successfully leveraged globalization to lift millions out of poverty.
 - We must recognize the threat it poses to local cultures. The spread of Western
values often leads to cultural homogenization, altering unique traditions around the
globe.
Example: The spread of Western fast-food chains, such as McDonald's, in
countries like India has led to concerns about cultural homogenization. Traditional food
practices and local cuisines are being overshadowed by global brands, altering unique
culinary traditions.
- Additionally, many multinational corporations may not adhere to minimum labor
standards, leading to unfair wages and unsafe working conditions.
Example: Reports from various multinational corporations, such as Nike, have
highlighted issues related to labor standards in factories located in LDCs. Workers often
face unsafe working conditions and receive low wages, raising ethical concerns about the
practices of these companies in their pursuit of profit.

9. Cultural convergence/divergence
9.1 Cultural convergence
- Globalization has been likened to cultural diffusion, where elements from one
environment influence another, leading to change. Factors like cheaper airfares, global
media, the internet, and travel opportunities contribute to cultural convergence.
Definition: condition in which two separate cultures come together to share culture
traits
- This trend reflects a growing similarity in beliefs, values, and aspirations
among consumers globally. Theodore Levitt argued that cultural differences are
fading as tastes homogenize, helping global companies gain competitive advantages.
Example:
• Global Brands: Companies like Apple and Samsung have successfully made their
products international standards. For example, the iPhone is not only a piece of
technology but also a cultural symbol across many countries, regarded as a "must-
have" product in the U.S., Europe, Asia, and Africa. Consumers worldwide share a
common preference for premium tech products and a modern lifestyle.
• Fast-Food Chains: McDonald's is a prime example of cultural convergence. They
have popularized Western fast food across many countries. Whether in China,
France, or India, iconic McDonald's items like the Big Mac or fries are now
 familiar. While there may be slight menu adjustments to suit local tastes, most of
the products and experiences remain consistent globally.
• Music and Movies: Hollywood movies and Western pop music (such as songs by
Beyoncé, Taylor Swift) have become part of global popular culture. Teenagers
from various countries listen to the same music, watch the same movies, and
follow the same international stars, creating similar entertainment preferences and
lifestyles.
- However, globalization also faces criticism for cultural imperialism, where
dominant cultures, particularly Western and American, replace local traditions. This
raises concerns about the loss of cultural diversity. In business, a common "global
management culture" is emerging, with professionals in regions like Western Europe,
North America, and BRIC countries becoming more alike in terms of income, lifestyle,
and aspirations.
Example:
• Replacing Local Culture: The rapid expansion of the Starbucks chain worldwide
has introduced Western coffee culture into countries with long-standing tea
traditions, such as China and Japan. This shift can lead to traditional tea houses
losing customers and being replaced by the Western-style coffee shop experience.
• Holidays and Events: Many countries now celebrate Halloween or Christmas,
even if they don’t have a cultural tradition for these holidays. In places like Japan
or South Korea, Christmas has become a major commercial event, despite not
being a historically significant holiday in their cultures.
• American Cartoons: Disney is a key example of cultural imperialism. Characters
like Mickey Mouse, Elsa, and The Lion King are not only popular in the U.S. but
have a strong influence on children and teenagers worldwide. Disney’s dominance
in entertainment can overshadow local stories, characters, and cultural traditions.
9.2 Cultural divergence
Definition: condition in which one culture splits into separate cultures
Example: Cultural Roots and Collaboration: European Union (EU): The EU
represents countries with shared cultural roots in terms of history, language, and
traditions, allowing them to work closely together. However, tensions often arise between
member states over cultural values, as seen in differing attitudes towards immigration and
national identity.
 - He warned that post-Cold War divisions are primarily cultural, with
civilizations like Western, Islamic, and Chinese becoming more distinct.
Example: Fragmentation into Civilizations: China's Global Influence: China is
increasingly asserting its cultural identity on the global stage, promoting Confucian
values and its own cultural norms through initiatives like the Belt and Road Initiative.
This can be seen as an example of a civilization (Chinese) asserting itself amidst a global
landscape dominated by Western influence.
- Cultural convergence is slow, with resistance and evidence of divergence.
Companies must adapt to local cultures, leading to the concept of "glocalization" –
thinking globally but acting locally.
Example: Glocalization: Coca-Cola: The company adapts its marketing strategies
to resonate with local cultures while maintaining its global brand identity. For instance,
during festivals, Coca-Cola may release limited-edition packaging that reflects local
customs or celebrations, illustrating the "think global, act local" approach.