GLOBALISATION

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GLOBALISATION

• Aim To discuss the phenomenon of globalisation
  and consider some of the schools of thought in
  the present debate.

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GLOBALISATION

• Globalisation may be thought of initially as the
  widening, deepening and speeding up of worldwide
  interconnectedness in all aspects of contemporary
  social life, from the cultural to the criminal,
  the financial to the spiritual.
• (Held et al)
•  

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How are YOU affected by GLOBALISATION?

• Many disciplines involved e.g. Philosophy,
  Politics, Economics, Geography, Sociology,
  Anthropology,
•  
•    Significant differences in definitions
•  
•    Widely varying assessment
• - Chronology
•   - Scale

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DEFINITIONS 

•    Internationalisation
•  
• large and growing flows of trade and capital
  investment between countries (Hirst/Thompson)
•  
•   Liberalisation
•  
• the process of international economic
  integration (Sander)

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Definitions (cont.)

• Universalisation
•  
• process of spreading various objects and
• experiences to people at all corners of the
  earth (Scholte)
•  
• a planetary synthesis of cultures
• (Reiser/Davies, 1940s)

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Definitions (cont.)

•  Deterritorialisation
•  a process which embodies a transformation in
  the
• spatial organisation of social relations and
• transactions (Held/McGrew)
• Westernisation/Modernisation
•  what we in the Third World have for several
• centuries called colonisation (Khor)

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Definitions (cont.)

• In the business environment
• Globalisation refers to the shift toward a
  more integrated and interdependent world
  economy.
• (Hill)
•  
• Main components
•  
• - Globalisation of markets
• - Globalisation of production

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THE CURRENT DEBATE 

• 3 schools of thought
•  
•       Hyperglobalizers (Radicals)
•       Sceptics
•       Transformationalists
• (Held et al)

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Hyperglobalisers (Radicals)

• Todays global economy is genuinely borderless.
• Information, capital and innovation flow all over
• the world at top speed, enabled by technology and
• fueled by consumers desires for access to the
  best
• and least expensive products.
• (K. Ohmae, 1995)

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Hyperglobalisers (Radicals) (cont.)

• Globalisation
•  
•    a new era
•    essentially an economic phenomenon
•    global marketplace rules supreme
•    brings denationalisation of economies through
  transnational networks of production, trade and
  finance

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Hyperglobalisers (Radicals) (cont.)

• institutions of global governance emerging
• ? sovereignty of nation state eroded
•  
• new global patterns emerging
• North-South/Core-Periphery replaced by more
• complex constellations of economic power.
•  

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Hyperglobalisers (Radicals) (cont.)

• Neo-Liberals victory of individual autonomy
• and market principle over state power.
•  
• Neo-Marxists victory of oppressive global
• capitalism.

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Sceptics

• We do not have a fully globalized economy, we
• do have an international economy and national
• policy responses to it.
• (Hirst and Thompson, 1997)

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Sceptics (cont.)

• Globalisation
•  
•    a myth, nothing new, only heightened levels
  of interaction between predominantly national
  economies
•    national governments remain powerful and
  continue to regulate international activity
•    governments not passive victims but
  architects of internationalisation

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Sceptics (cont.)

•    governments not passive victims but
  architects of internationalisation
• Regionalisation NOT Globalisation
• international economy divided into three major
  blocs
• -Europe
• -North America
• -Asia Pacific

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Sceptics (cont.)

• world economy now less integrated than during the
  classical Gold Standard era
•    international patterns of inequality have
  changed only marginally
• rise of aggressive nationalism/fundamentalism
  (clash of civilisations)

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Transformationalists

• Many of us feel in the grip of forces over which
  
• we have no control. Can we re-impose our will
• upon them? I believe we can. The powerlessness
• we experience is not a sign of personal failings,
  but
• reflects the incapacities of our institutions. We
  
• need to reconstruct those we have , or create new
  
• ones, in ways appropriate to the golden age.
  (Giddens, 1999)

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Transformationalists (cont.)

• Globalisation
• a central driving force behind the rapid social,
  political and economic changes
• is reshaping the world order
• historically unprecedented
• no longer distinction between domestic and
  international affairs (intermestic)

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TRANSFORMATIONALISTS (cont.)

• future direction uncertain
• leads to new global stratification
• sovereignty of the state juxtaposed with
  institutions of international governance
• new sovereignty regime displacing traditional
  notions of statehood and sovereignty
• governments more outward looking
• Power of national governments not diminished but
  restructured and reconstituted
• (based on Held et al)

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• Where do YOU stand in this debate?

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Globalisation (cont.)

• Accurate assessment difficult
• Lack of long-term global data

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Globalisation (cont.)

• Economic integration
•  
•    shallow integration
• - trade in goods and services
• - movement of capital
•  
• deep integration
• - from 1960s onward
• - extends to production of goods and services
• - increases visible and invisible trade
• - involves primarily TNCs

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Globalisation (cont.)

•    Internationalisation
• Extension of economic activity across
• national borders growing quantitatively.
•    Globalisation
• as internationalisation qualitatively
• different functional integration of
• internationally dispersed activities.
•  

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Globalisation (cont.)

•    Uneven spread of globalisation
•  
• - country/region
•   - urban/rural
•   - social class
•   - age group

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The Drivers of (Economic) Globalisation

• Improvements in technology
•   - communication
•   - transport
•  
•    Demand for opportunities created
•  
•    Impact of public policies
• INTERACTION of these factors is important!
•  

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The Drivers of (Economic) Globalisation(cont.)

• Examples
• Passenger transport to USA
• During colonial times indentured servant
  (5-7yrs)
• Early 20th century 2-3 months wages
• 21st century ???

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The Drivers of (Economic) Globalisation(cont.)

• ? Increase in migration/passenger traffic
•  
• ?Increase in international trade

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The Drivers of (Economic) Globalisation(cont.)

• Since WWII
•    dramatic improvements in air cargo
•  
•    integration of sea/road/rail transport
  through use of containers
•  
•    Communication costs have fallen dramatically
•  
• Reductions in both COST and TIME!

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The Drivers of (Economic) Globalisation(cont.)

• Since WWII
•    real living standards have improved threefold
•  
•    World trade in goods and services has
  increased by nearly twice the pace of GDP
• -1950 just under 1/10 of world GDP
• - 2000 about 1/3 of world GDP
•  
•    Artificial barriers to international trade
  have fallen by between 80 and 90 percent.

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THE HISTORICAL PERSPECTIVE

• Positions change with definition
• Cyclical/recurring phenomenon
• Linear development
•  
• Germination phase post 15th century
•  
• Take-off period mid 19th century
• (Robertson)

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THE HISTORICAL PERSPECTIVE (cont.)

• Germination phase post 15th century
• Take-off period mid 19th century
• (Robertson)
• Start in late 19th century
• (Porter)
• Globalisation a phenomenon of the present
• (Drucker)

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THE HISTORICAL PERSPECTIVE (cont.)

• 15th/16th century
• Local trade basic necessities
• Long-distance trade luxury goods (spices, fine
• cloth)
• European maritime nations at centre of
  international trade
• dramatic expansion of international trade
• Core Spain, Portugal
•  

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THE HISTORICAL PERSPECTIVE (cont.)

• 17th century
• Core moved north
• England, Netherlands, France
• Development of world trading system ?Tripartite
  structure core/semi-periphery/periphery

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THE HISTORICAL PERSPECTIVE (cont.)

• 19th century industrialisation
• Accelerated and further changed world trade
• Core - industrial production
• - exported m/f goods, imported raw
  materials from colonies
• ?New international division of labour

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THE HISTORICAL PERSPECTIVE (cont.)

• Periphery - supplied raw materials and
  foodstuffs
• - market for machinery and equipment
• trade between core nations and exports to
  periphery
• Core Britain.
• 19th/20th century industrial production moves to
  the US and Germany

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THE HISTORICAL PERSPECTIVE (cont.)

• Overall development rapid growth of production
  and geographical expansion/shifts followed by
  stagnation/recession
•  
•    Kondratiev long waves
•  
•    World War II decisive break, The West,
  Eastern Bloc, Third World.

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THE HISTORICAL PERSPECTIVE (cont.)

• Shift from British to US dominance
•  
• Emergence of Germany and Japan as leading
• manufacturing nations
•  
• Manufacturing moving from core to periphery
• to a more complex pattern of production
• (Asia - Pacific Eastern Europe)
•  
•    The End of Globalisation?

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Summary

• Definition
• 3 schools of thought
• - Radicals (Hyperglobalisers)
• - Sceptics
• - Transformationalists
• Drivers of globalisation
• The historical perspective

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Additional Reading

• Dicken, P. (1999) Global Shift (3rd edition),
• London Chapman
•  
• Giddens, A. (2000) Runaway World How
  Globalization is Reshaping our Lives, Andover
  Routledge.
•  
• Held, D. et al (2000) Global Transformations,
  Cambridge Polity Press.

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Additional Reading (cont.)

• Hirst, P. and Thompson, G. (1999) Globalization
  in Question (2nd edition) Cambridge Polity
  Press.
•  Ohmae, K. (1990) The Borderless World Power and
  Strategy in the Interlinked Economy, New York
  Free Press
•  Ohmae, K. (1995) The End of the Nation State
  The Rise of Regional Economies, New York Free
  Press
•  Scholte, J A. (2000) Globalization A Critical
  Introduction, Basingstoke MacMillan.

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Additional Reading (cont.) www.

•  IMF
• www.imf.org/external/np/exr/ib/2000/041200.htm
•  
• International Forum on Globalisation
• www.ifg.org
•  
• United Nations Conference on Trade and
• Development (UNCTAD)
• www.unctad.org/en/pub/pslwir99.htm
•  
• International Chamber of Commerce
• www.icccwbo.org
•