Official Format of Module For College Department

Lemery Colleges, Inc.
A. Bonifacio St., Brgy. Bagong Sikat, Lemery, Batangas
Academic Year 2020-2021

FIRST SEMESTER
An Instructional Module and

Compilation of Resources:
CONTEMPORARY WORLD
NAME OF
STUDENT
YEAR & SECTION
Course Code :
Course Description : CONTEMPORARY WORLD
Credit Unit : 3 Units
Instructor : Shena C. asinas
NOTE
No part of this compilation may be reproduced in any form or by any means without prior
written consent of the institution.
VISION:
CONTEMPORARY WORLD ▪ PAGE 1

“Expanding the Right Choice for Real Life Education in Southern Luzon”
MISSION:
Cognizant to the vital role of real life education, LC is committed to:
1. Provide holistic higher education and technical-vocational programs which are valued by the stakeholders.
(Academics)
2. Transform the youth into world-class professionals who creatively respond to ever changing world of work.
(Graduates)
3. Advance research production to improve human life and address societal needs. (Research)
4. Engage in various projects that aim to build strong community relation and involvement. (Community)
5. Promote compliance with quality assurance in both service delivery and program development. (Quality Assurance)
CORE VALUES:
L- Love of God and Country

C- C’s (Competent, Committed and Compassionate) in service
I- Innovative Minds
A- Aspiring People
N- Noble Dreams
PROGRAM EDUCATIONAL OBJECTIVES

(BS )
A. Competencies
1. Distinguish different interpretations of and approaches to globalization
2. Describe the emergence of global economic, political, social, and cultural systems
3. Analyze the various contemporary drivers of globalization
4. Understand the issues confronting the nation-state
5. Assess the effects of globalization on different social units and their responses
B. Skills
1. Analyze contemporary news events in the context of globalization

2. Analyze global issues in relation to Filipinos and the Philippines

3. Write a research paper with proper citations on a topic related to globalization
C. Values
1. Articulate personal positions on various global issues
2. Identify the ethical implications of global citizenship
TABLE OF CONTENTS

LESSON TOPICS PAGE
Title Page 1
Preliminaries Lemery Colleges’ Vision and Mission 2
Table of Contents 3
Flexible Learning Design Worksheet (Course Outline) 4
1 Introduction to the Study of Globalization

11
2 The Structures of Globalization 15

The Global Economy
Market Integration
The Global Interstate System
Contemporary Global Governance
3 A World of Regions
Global Divides: The North and the South (focus on Latin America)
Asian regionalism

B. Bonifacio St., Brgy. Bagong Sikat, Lemery, Batangas
FLEXIBLE LEARNING DESIGN WORKSHEET

COURSE
CODE
COURSE
CONTEMPORARY WORLD
TITLE
This course introduces students to the contemporary world by examining the multifaceted phenomenon of globalization. Using the various disciplines of the social sciences, it
COURSE examines the economic, social, political, technological, and other transformations that have created an increasing awareness of the interconnectedness of peoples and places
DESCRIPTION around the globe. To this end, the course provides an overview of the various debates in global governance, development, and sustainability. Beyond exposing the student to the
world outside the Philippines, it seeks to inculcate a sense of global citizenship and global ethical responsibility.
TEACHING AND LEARNING ACTIVITIES WAYS OF
(PREFERRED DELIVERY) ASSESSING THE
WEEK/ OBJECTIVES LEARNING RESOURCES
LEARNING OBJECTIVE/S TOPICS VIDEO/ MODULAR (ASSESSMENT
SESSION NO. VIRTUAL
RECORDE TASKS)
CLASSROOM
D LECTURE
PRINTE
ELECTRONIC
D
▪Lemery Colleges’
▪ Internalize and uphold the Institution’s Vision, Mission, ▪Short essays ▪Lemery Colleges’ Vision, Mission,
vision and mission Goals, and (Students submit Mission, Goals and Objectives
1  
▪ Understand the college goals and Objectives written work ▪SBM Goals
program objectives ▪BSCA Program electronically) ▪BSCA Program Objectives
Objectives
▪Voice over narrated
powerpoint
 Differentiate the competing conceptions
presentation
of globalization Introduction to
▪Video Clip
2-3  Identify the underlying philosophies of Globalization
  Presentation
the varying definitions of globalization  Defining
▪Assignments
 Agree on a working definition of globalization
▪Short Essays
globalization for the course
▪Worksheets/ Activity
Sheets
4 ▪ Define economic globalization The Structures of   ▪Voice over narrated
Identify the actors that facilitate economic Globalization powerpoint

 The Global
Economy
presentation
 Market
▪Video Clip
globalization Integration
Presentation
 Define the modern world system  The Global
▪Assignments
Articulate a stance on global economic Interstate
▪Short Essays
integration System
 Contemporary
Sheets
Global
Governance
 Explain the role of international financial powerpoint
institutions in the creation of a global presentation
economy  Market ▪Video Clip
 Narrate a short history of global market Integration   Presentation
integration in the twentieth century ▪Assignments
 Identify the attributes of global ▪Short Essays
corporations ▪Worksheets/ Activity
Sheets
powerpoint
 Explain the effects of globalization on
presentation
governments  The Global
▪Video Clip
 Identify the institutions that govern Interstate
  Presentation
international relations System
▪Assignments
 Differentiate internationalism from
▪Short Essays
globalism
Sheets
 Identify the roles and functions of the  Contemporary   ▪Voice over narrated
United Nations Global powerpoint
 Identify the challenges of global Governance presentation
governance in the twenty-first century ▪Video Clip
 Explain the relevance of the state amid Presentation

▪Assignments
▪Short Essays
globalization
Sheets
5 PRELIMINARY EXAMINATIONS
 Define the term “Global South” ▪Short essays
 Differentiate the Global South from the (Students submit
Third World written work
 Analyze how a new conception of electronically)
A World of Regions
global relations emerged from the ▪Voice over narrated
 Global Divides:
experiences of Latin American powerpoint
6-8 The North and
countries   presentation
the South
▪Video Clip
 Asian
Presentation
Regionalism
▪Assignments
▪Short Essays
Sheets
9 MIDTERM EXAMINATIONS
 Analyze how various media drive ▪Short essays
10-11 various forms of global (Students submit
 Explain how globalization affects written work
A World of Ideas
religious practices and beliefs electronically)
 Global Media
 Analyze the relationship between ▪Voice over narrated
Cultures
religion and global conflict and, powerpoint
 The
conversely, global peace   presentation
Globalization of
▪Video Clip
Religion
Presentation
▪Assignments
▪Short Essays
Sheets

 Identify the attributes

Global Population ▪Seatwork and
of a global city ▪ Understanding and Managing
12-13 and Mobility assignments
 Analyze how cities Organiational Behavior Module-Lesson
   ▪Skills exercises
serve as engines of 6-ppt
 The Global City ▪Student Self
globalization
assessment
 Mandated topic:
 Explain the theory of demographic Global
  
transition as it affects global population Demography
 Analyze the political,

economic, cultural, and social factors
underlying the global movements of people  Global Migration
  
 Display first-hand knowledge of the
experiences of OFWs
 Research
Proposal
 Write a research paper proposal with
proper citation
 Writing   
 Critique research proposals of
Research
classmates.
Proposal
Critique
14 SEMI FINAL EXAMINATIONS
15-16  Differentiate stability from sustainability Towards a    ▪Voice over narrated Understanding and Managing
Articulate models of global sustainable Sustainable World powerpoint Organiational Behavior Module-Lesson
development Sustainable presentation 7-ppt
 Define global food security Development ▪Video Clip

Presentation
▪Assignments
 Critique existing models of global food Global Food
▪Short Essays
security Security
Sheets
 Articulate a personal definition of global powerpoint
citizenship Conclusion presentation
Understanding and Managing
 Appreciate the ethical obligations of  Global ▪Video Clip
Organiational Behavior Module-Lesson
17-18 global citizenship Citizenship   Presentation 9-ppt
 Write a research paper on a topic  Research paper ▪Assignments
related to globalization, with proper writing ▪Short Essays
citation ▪Worksheets/ Activity
Sheets
18 FINAL EXAMINATIONS
GRADING SYSTEM:
(LECTURE/ LABORATORY COURSES)
MAJOR EXAM : 60%
CLASS STANDING : 40%
-Assignment
-Seatwork/ Activities
-Project
-Quiz
-Report
-Presentation
-Case Studies
-Problem Analysis
-Other outputs
TOTAL 100%

Lesson 1
TOPIC: Introduction to the Study of Globalization
DURATION: 1 WEEK
PREFERRED DELIVERY: Video/ Recorded Lecture/Printed Module
LEARNING OBJECTIVES
By the end of this module, students will have completed the following objectives:
Differentiate the competing conceptions of globalization
 Identify the underlying philosophies of the varying definitions of globalization
 Agree on a working definition of globalization for the course
TO DO LIST
Write a personal definition of globalization based on a concept map

Reading
o Course Content and Lecture in Module 1 (page )
Watch Lecture Video
Take Activity #2
Take Quiz
COURSE CONTENT
I. GLOBALIZATION

What Is Globalization?
Globalization is the spread of products, technology, information, and jobs across
national borders and cultures. In economic terms, it describes an interdependence of nations
around the globe fostered through free trade
On one hand, globalization has created new jobs and economic growth through the
cross-border flow of goods, capital, and labor. On the other hand, this growth and job creation
is not distributed evenly across industries or countries. Specific industries in certain countries,
such as textile manufacturing in the U.S. or corn farming in Mexico, have suffered severe
disruption or outright collapse as a result of increased international competition.
Globalization motives are idealistic, as well as opportunistic, but the development of a

global free market has benefited large corporations based in the Western world. Its impact
remains mixed for workers, cultures, and small businesses around the globe, in both
developed and emerging nations.
Competing Conceptions of Globalization
Globalization as a process, a condition, a system, a force, and age.
UNCTAD (United Nations Conference on Trade and Development)
 globalization is a closer integration of national economies through trade and financial

flows as well as cross-border migration of people.
Globalization brings three freedoms (Free movement of goods or products, services, capital
or investment, and persons.
European Union
1. free movement of goods because of abolition of tariff – tax on imported goods.
2. free movement of capital or investment because of lifting of strict banking and financial
regulations that encourage investors
3. free movement of persons because of abolition of visa restrictions
 wages hikes
 privatization
 migration and outsourcing of jobs
Liberalization
 economic process that require laws or policies which are products of confrontation
between conflicting interests.
Globalization as the process of world shrinkage, of distances getting shorter, things

moving closer. Increasing ease with which somebody on one side of the world can interact to
mutual benefits with somebody on the other side of the world.

Globalization’s definition is complex, multifaceted because it deals with either

economic, political and social dimensions. It is not easy to define because it has a shifting
nature. It can be influenced by people who define it.
SOLID VS LIQUID
Metaphors of Globalization
Solidity
 refers to the barriers that prevent or make difficult movement of things; can be natural
or man-made.
Natural solids:
 The Great Wall of China and Berlin Wall, imaginary line such as the nine-dash line
used by China in their claim to the South China Sea.
Man-made solids
IT IS NOW BECOMING INCREASINGLY LIQUID.
BUT THIS IS MELTING.
Liquid
 takes the shape of its container.
Videos uploaded on Youtube or FB are unstoppable once they become viral.
Liquidity
 refers to the increasing ease of movement of people, things, information, and places in
the contemporary world. It is difficult to stop.
Space and time are crucial elements of globalization. Why?
The metaphor that could best describe globalization is liquidity.
FLOWS
Foods are being globalized.
Think of the different foreign cuisine patronized and consumed by Filipinos.
It is not static, but a dynamic on-going process: globalization involves the inexorable
integration of markets, nation-states, and technologies to a degree never witnessed before -
in a way that it is enabling individuals, corporations, and nation-states to reach around the
world farther, faster, deeper, and cheaper than ever before, and in a way that it is also
producing a powerful backlash from those brutalized or left behind by this new system

Definitions of Globalization
A Simple Globalization Definition

Globalization means the speedup of movements and exchanges (of human beings, goods, and services, capital,
technologies or cultural practices) all over the planet. One of the effects of globalization is that it promotes and increases
interactions between different regions and populations around the globe.
An Official Definition of Globalization by the World Health Organization (WHO)

According to WHO, 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.”
What Is Globalization in the Economy?

According to the Committee for Development Policy (a subsidiary body of the United Nations), from an economic
point of view, globalization can be defined as:
“(…) the increasing interdependence of world economies as a result of the growing scale of cross-border trade of
commodities and services, the flow of international capital and the wide and rapid spread of technologies. It reflects the
continuing expansion and mutual integration of market frontiers (…) and the rapid growing significance of information in all
types of productive activities and marketization are the two major driving forces for economic globalization.”
What Is Globalization in Geography?

In geography, globalization is defined as the set of processes (economic, social, cultural, technological, institutional)
that contribute to the relationship between societies and individuals around the world. It is a progressive process by which
exchanges and flows between different parts of the world are intensified.
What is an organization? An organization is defined as a collection of people who work together to achieve a wide
variety of goals. Organizational behavior is defined as the actions and attitudes of people in organizations. The field of
organizational behavior (OB) covers the body of knowledge derived from these actions and attitudes. It can help managers
understand the complexity within organizations, identify problems, determine the best ways to correct them, and establish
whether the changes would make a significant difference.

Lesson 2
TOPIC: The Structures of Globalization
DURATION: 1 WEEK
The Global Economy
I. Economic Globalization
 refers to the increasing integration of economies around the world, particularly through the movement of goods,
services, and capital across borders.
Economic globalization is a spread of trade, transportation, and communication systems on a global scale in the
interest of promoting international commerce. There are two different economies we should know about economic
globalization. These are protectionism and trade liberalization. Protectionism is protecting one’s economy from foreign
competition by creating trade barriers while trade liberalization is the act of reducing trade barriers to make international
trade easier between countries. These trade barriers are usually tariffs which are required fees on imports or exports and
quota which is the limited quantity of a particular product that under official controls can be produced, exported, or imported.
 a historical process, the result of human innovation and technological progress

In ancient times, traders traveled vast distances to buy rare commodities such as salt, spices and
gold, which they would then sell in their home countries.
 Gills and Thompson (2006)- migration

According to Gills and Thompson, globalization processes have been ongoing ever since Homo sapiens
began migrating from the African continent ultimately to populate the rest of the world. Minimally, they have been ongoing
since the sixteen-century’s connection of the Americas to Afro-Eurasia.
 Silk Road- best known example of old-fashioned globalization

The Silk Road was an ancient network of trade routes, formally established during the Han Dynasty of
China, which connected Asia, Africa, and Europe.
 Adam Smith- magnum opus, An inquiry into the nature and causes of the wealth of nations (1776)
When he wrote this masterpiece, he considered the discovery of America by Christopher Columbus in 1492
and the discovery of the direct sea route to India by Vasco de Gama in 1498 as the two greatest achievements in human
history which serve as pathways to network and trade. However, in the course of a couple of decades these remarkable
achievements were overshadowed by the breathtaking technological advances and organization methods of the British
Industrial Revolution.
 1800s- industrial revolution

From the early 1800s, following the Napoleonic wars, the industrial revolution spread to Continental Europe
and North America, too. This time period saw the mechanization of agriculture and textile manufacturing and a revolution in
power, including steam ships and railroads which affected social, cultural and economic conditions.
 The British and the Dutch East India Companies- established in 1600 and 1602, respectively
The economic nationalism of the 17th and 18 th centuries, coupled with monopolized trade (such as the first
multinational corporations, the British and the Dutch East India Companies, established in 1600 and 1602, respectively) did
not favor, international economic integration.
 Between 1500 and 1800- total number of ships sailing to Asia from major European countries rose

remarkably
The total number of ships sailing to Asia from major European countries rose remarkably between 1500
and 1800 (in numbers: 770 in the 16th, 3,161 in the 17th and 6,661 in the 18th century).
 World export to world Gross Domestic Product (GDP)

However, world export to world GDP did not reach more than one to two per cent in that period. Gross
domestic product (GDP) is the monetary value of all the finished goods and services produced within a country's borders in
a specific time period. GDP is commonly used as an indicator of the economic health of a country, as well as a gauge of a
Country's standard of living.
 19th Century
The real break-through came only in the 19 th century. The annual average compound growth rate of world
trade saw a dramatic increase of 4.2 per cent between 1820 and 1870, and was still relatively high, at 3.4 per cent between
1870 and 1913.
 1870 to 1913- golden age of globalization

The relatively short period before World War I is often referred to as the ‘golden age’ of globalization, since
it was characterized by relative peace, free trade and financial and economic stability.
 1913- trade equaled to 16-17 %

By 1913, trade equaled to 16–17 per cent of world income, due to the transport revolution: steamships and
railroads reduced transaction costs and strengthened both internal and international exchange.
 The phenomenon has several interconnected dimensions such as the globalization of trade of goods and services,
the globalization of financial and capital markets, the globalization of technology and communication, and the
globalization of production.
Transnational Corporations (TNCs)
 the major players of present-day global economy

 the main driving forces of economic globalization of the last 100 years, accounting for roughly two-thirds of world
export
Transnational corporations (TNCs) are incorporated or unincorporated enterprises comprising parent enterprises
and their foreign affiliates such as Procter & Gamble and Coca-Cola Company. A parent enterprise is defined as an
enterprise that controls assets of other entities in countries other than its home country, usually by owning a certain equity
capital stake. A foreign affiliate is an incorporated or unincorporated enterprise in which an investor, who is resident in
another economy, owns a stake that permits a lasting interest in the management of that enterprise.
Multinational Corporation has an international identity as belonging to a particular home country where they are
headquartered. A transnational company is borderless, as it does not consider any particular country as its base, home or
headquarters. Transnational Corporation is a type of multinational corporations.
Global commodity chain
 an idea that reflects upon the increasing importance of global buyers in a world of dispersed production
As economic integration is becoming more intensive, production disintegrates as a result of the outsourcing activity
of multinationals (Feenstra, 1998). This move induced Gereffi (1999) to develop the concept of global commodity
chains. A commodity chain is a process used by firms to gather resources, transform them into goods or
commodities, and finally, distribute them to consumers. It is a series of links connecting the many places of
production and distribution and resulting in a commodity that is then exchanged on the world market.
The Modern World System

The world systems theory, developed by sociologist Immanuel Wallerstein, is an approach to world history
and social change that suggests there is a world economic system in which some countries benefit while others are
exploited. The world systems theory is established on a three-level hierarchy
 Consisting of core
 Periphery
 semi-periphery areas.
This theory emphasizes the social structure of global inequality.
Core countries are dominant capitalist countries that exploit peripheral countries for labor and raw materials. They
are strong in military power and not dependent on any one state or country. They serve the interests of the economically
powerful. They are focused on higher skill and capital-intensive production. Core countries are powerful, and this power
allows them to pay lower prices for raw goods and exploit cheap labor, which constantly reinforces the unequal status
between core and peripheral countries.
The first core region was located in northwestern Europe and made up of England, France, and Holland. Today, the
United States is an example of a core country. The U.S. has large amounts of capital, and its labor forces are relatively well
paid.
The world-systems analysis defines semi-periphery regions as the primary structural elements in the economy of
the world. Currently, all semi-periphery areas are industrialized, and they contribute to the manufacture and export of
various commodities. The semi-periphery level plays a significant role when it comes to stabilizing world systems since it
facilitates interactions and connections between the high-income states to the low-income nations by introducing a different
level in the hierarchy of the world systems. These regions are essential elements in the global trade system since they
alleviate the pressure which the core regions exert on the periphery areas and vice versa. Also referred to as the middle-
class, they exist to divide the economic power between the periphery and core areas.
These nations are characterized by extensive lands as demonstrated by Indonesia, Mexico, Iran, Brazil, India,
China, and Argentina. Although more and means an increased market share and size, there are other semi-peripheral
regions smaller in sizes like Greece, Poland, and Israel.
Periphery countries lack a strong central government and possesses a disproportionately small share of the world's
wealth. These areas are less developed than the core and the semi-periphery. These countries export raw materials to the
core countries; are often dependent on more developed nations for capital and; have underdeveloped industry. These
countries also have low-skill, labor intensive production, or in other words, cheap labor. Periphery countries may have an
unstable government, inferior technologies, and poor health and educational systems. At times, the exploitations of these
countries with regards to cheap labor, agriculture, and natural resources may help the core countries remain wealthy.
Periphery countries are commonly also referred to as third-world countries. Eastern Europe and Latin America were the first
peripheral zones. An example nowadays is Cape Verde, a chain of islands off the west coast of Africa.
World-economy
 is a large geographic zone within which there is a division of labor and hence significant internal exchange
of basic or essential goods as well as flows of capital and labor. The term world economy refers to all of the
economic activity within each country and between countries around the world. The world economy or
global economy is considered as the international exchange of goods and services that is expressed in
monetary units of account (money).
Capitalist system
 the system gives priority to the endless accumulation of capital. Endless accumulation means that people
and firms are accumulating capital in order to accumulate still more capital, a process that is continual and
endless.
 A capitalist economic system is one characterized by free markets and the absence of government
intervention in the economy. In practice a capitalist economy will need some government intervention,
primarily to protect private property.
 This system is consist of various features such as

 economic freedom (individuals are free to set up business and provide goods and services they want),
 consumer sovereignty (consumers are free to decide which goods and services to purchase)
 limited government interventions (government intervention are limited to protection of private property and
provision of public goods)
 finance sector (capitalism requires a developed banking and financial system which can provide loans to
companies and banking services to households)
 profit motive (is seen as important for enabling an efficient distribution of resources and encouraging
innovation and responsive markets)
 market forces (allocation of goods is based on demand and supply)
 flexible labor markets (easy to hire and fire workers)
 free trade (low tariff barriers to encourage international trade).
Capitalist world-economy
 a collection of many institutions, the combination of which accounts for its processes, and all of which are
intertwined with each other.
 The basic institutions are the market, or rather the markets; the firms that compete in the markets; the
multiple states, within an interstate system; the households; the classes; and the status-groups. They are
all institutions that have been created within the framework of capitalist world-economy.
Market
 is both a concrete local structure in which individuals or firms sell and buy goods, and a virtual institution
across space where the same kind of exchange occurs.
 A market is a medium that allows buyers and sellers of a specific good or service to interact in
order to facilitate an exchange.
 This type of market may either be:
 physical marketplace where people come together to exchange goods and services in person, as
in a bazaar or shopping center
 virtual market wherein buyers and sellers do not interact, as in an online market.
Technically speaking, a market is any medium through which two or more parties can engage in an economic transaction,
even those that do not necessarily need to involve money. A market transaction may involve goods, services, information,
currency or any combination of these things passing from one party to another in exchange for one of these or another
combination.
Firms
 the main actors in the market.
 A firm is a business organization, such asa corporation, limited liability company or partnership that sells
goods or services to make a profit. Firms are normally the competitors of other firms operating in the same
virtual market. They are also in conflict with those firms from whom they purchase inputs and those firms to
which they sell their products.
Core-periphery
 the degree of profitability of the production processes.
 The center–periphery (or core–periphery) model is a spatial metaphor which describes and attempts to
explain the structural relationship between the advanced or metropolitan ‘center’ and a less developed
‘periphery’, either within a particular country, or (more commonly) as applied to the relationship between
capitalist and developing societies. The center–periphery model thus suggests that the global economy is
characterized by a structured relationship between economic centers which, by using military, political, and
trade power, extract an economic surplus from the subordinate peripheral countries.
 One major factor in this is the inequality between wage-levels between core and periphery, which make it
profitable for capitalist enterprises to locate part or all of their production in underdeveloped regions.
 The extraction of profit depends on that part of the cost of the reproduction of the labor-force that is not
met by wages being met in the non-capitalist sector. Thus, according to proponents of the core–periphery

model, the appearance that capitalism is developing traditional and backward societies by locating
enterprises in underdeveloped regions masks the structural relationship by which capital develops and
prospers at the expense (or progressive underdevelopment) of non-capitalist economies.
II. MARKET INTEGRATION
According to the Cambridge Business English Dictionary, Market Integration is a situation in which separate
markets for the same product become one single market, for example when an import tax in one of the market is removed.
Integration is taken to denote a state of affairs or a process involving attempts to combine separate national economies into
larger economic regions (Robson, 1998, p.1)
The Role of International Financial Institutions in the Creation of Global Economy
International Financial Institutions

 International non-profit agencies are one of the major sources of financing like regional development
banks or banks globally.
 To finance productive development projects or to promote economic development
A. WORLD BANK
 multinational financial institution established at the end of World War II (1944) to help provide long-term
capital for the reconstruction and development of member countries.
 it provides much of the planning and financing for economic development projects involving billions of
dollars
Purpose for the setting up of the Bank

 To assist in the reconstruction and development of territories of members
 To promote private foreign investment by means of guarantees or participation in loans and other
investments made by private investors
 To promote the long-range balanced growth of international trade and the maintenance of equilibrium in
balance of payments
 To conduct its operations with due regard to the effect of international investment on business conditions
in the territories of members
 To assist in bringing about a smooth transition from a wartime to a peacetime economy
International Bank for Reconstruction and Development (IBRD)

 The IBRD was set up in 1945 along with the IMF to aid in rebuilding the world economy and it was owned
by the governments of 151 countries and its capital is subscribed by those governments
 It provides funds to borrowers by borrowing funds in the world capital markets , from the proceeds of loan
repayments as well as retained earnings.
 At its funding, the bank’s major objective was to serve as an international financing facility to function in
reconstruction and development.
 Lends money to a government for the purpose of developing that country’s economic infrastructure such
as roads and power generating facilities
 Also, funds are lent only to members of the IMF , usually when private capital is unavailable at reasonable
terms.
 Generally, bank loans are made to cover only import needs in foreign convertible currencies and must be
repaid in those currencies at long-term rates.
 The government assisted in formulating and implementing an effective and comprehensive strategy for the
development of new industrial free zones and the expansion of existing ones
 Lays special operational emphasis on environmental and women’s issues.

International Development Association

 The IDA was formed in 1960 as a part of the World Bank Group to provide financial support to LDCs and
has 137 member countries, although all members of the IBRD are free to join the IDA.
 IDA’s funds come from subscriptions from its developed members and from the earnings of the IBRD.
 Credit terms usually are extended to 40 to 50 years with no interest.
 Repayment begins after a ten-year grace period and can be paid in the local currency, as long as it is
convertible.
 Although the IDA’s resources are separate from the IBRD, it has no separate staff. Loans are made for
similar projects as those carried out by IBRD, but at easier and more favourable credit terms.
 The present emphasis seems to be on helping the masses of poor people in the developing countries
become more productive and take an active part in the development process.
Greater emphasis is being placed on improving urban living conditions and increasing productivity of small
industries.
International Finance Corporation

 The IFC was established in 1956. There are 133 countries that are members of the IFC and it is legally
and financially separate from the IBRD
Main responsibilities are:
(i) To provide risk capital in the form of equity and long-term loans for productive private enterprises in
association with private investors and management;
(ii) To encourage the development of local capital markets by carrying out standby and underwriting
arrangements
(iii) To stimulate the international flow of capital by providing financial and technical assistance to privately
controlled finance companies. Loans are made to private firms in the developing member
countries and are usually for a period of seven to twelve years
 The key feature of the IFC is that its loans are made to private enterprises and its investments are made in
conjunction with private business .
 In addition to funds contributed by IFC, funds are also contributed to the same projects by local and foreign
investors
What does the World Bank do?

 The World Bank is the world’s largest source of development assistance, providing nearly $30 billion in
loans, annually, to its client countries.
 The main focus is on helping the poorest people and the poorest countries hut for all its clients, the Bank
emphasizes the need for:
 investing in people, particularly through basic health and education;
 protecting the environment;
 supporting and encouraging private business development;
 strengthening the ability of the governments to deliver quality services efficiently and transparently;
 promoting reforms to create a stable macroeconomic environment conducive to investment and long-term
planning;
 focusing on social development, inclusion, governance and
 Institution building as key elements of poverty reduction
 The Bank is also helping countries to strengthen and sustain the fundamental conditions that help to
attract and retain private investment.
 They are investing in human resources, infrastructure and environmental protection which enhance the
attractiveness and productivity of private investment
INTERNATIONAL MONETARY FUND

 IMF is a cooperative institution that 182 countries have voluntarily joined because they see the advantage
of consulting with one another on this forum to maintain a stable system of buying and selling their
currencies
 Its policies and activities are guided by its Charter known as the Articles of Agreement.
 IMF lends money to members having trouble meeting financial obligations to other members, but only on
the condition that they undertake economic reforms to eliminate these difficulties for their own good and
that of the entire membership.
 Contrary to widespread perception, the IMF has no effective authority over the domestic economic policies
of its members
 There are several major accomplishments to the credit of the International Monetary System.
For example, it
 sustained a rapidly increasing volume of trade and investment;
 displayed flexibility in adapting to changes in international commerce;
 proved to be efficient (even when there were decreasing percentages of reserves to trade);
 proved to be hardy (it survived a number of pre-1971 crises, speculative and otherwise, and the down-and-
up swings of several business cycles);
 allowed for a growing degree or international cooperation;
 established a capacity to accommodate reforms and improvements
 To an extent, the fund served as an international central bank to help countries during periods of
temporary balance of payments difficulties by protecting their rates of exchange. Because of that,
countries did not need to resort to exchange controls and other barriers to restrict world trade
Purpose of IMF
 To promote international monetary cooperation through a permanent institution that provides the
machinery for consultation and collaboration on international monetary problems
 To facilitate the expansion and balanced growth of international trade and to contribute, thereby, to the
promotion and maintenance of high levels of employment and real income and to the development of the
productive resources of all members as primary objectives of economic policy
 To promote exchange stability, to maintain orderly exchange arrangements among members and to avoid
competitive exchange depreciation
 To assist in the establishment of a multilateral system of payments in respect of current transactions
between members and in the elimination of foreign exchange restrictions which hamper the growth of
world trade
 To give confidence to members by making the general resources of the Fund temporarily available to them
under adequate safeguards, thus providing them with opportunity to correct maladjustment in their balance
of payments without resorting to measures destructive to national or international prosperity
 In accordance with the above, to shorten the duration and lessen the degree of disequilibrium in the
international balances of payments of members.
How can IFIs help in Economic Globalization

 They focus on long-term investment projects, institution-building, and on social, environmental, and
poverty issues
 strengthen economic governance
 safeguard the stability and integrity of the international financial system as a global public good
 encouraging true national ownership of reforms by streamlining the conditions attached to IMF-supported
programs.
 recognizes and values the role of civil society organizations
 ensuring the stability of the international financial system
 helping individual countries take advantage of the investment opportunities offered by international capital
markets, while reducing their vulnerability to adverse shocks or changes in investor sentiment.

 Trade liberalization
 Reducing debt burdens
 Setting the stage for the 2030 development agenda
Brief History of Global Market Integration in the 20th Century

 The international economic integration achieved during the nineteenth century was largely unraveled in the
twentieth by two world war and the Great Depression.
 World War 1 brought the liberal economic order of the late 19th century to an abrupt end; 1914 clearly marked a
dramatic and discontinuous break in the past.
 Import shares fell only marginally in Britain during the war. In France, the import share rose from 20% before the
war to 36.7 % during it; again exports fell sharply.
 Export ratios rose in neutral economies such as in Sweden, Japan, and North America., where grain production
expanded sharply during the war years to meet Allied demand.
 The absence of European manufactured exports on world markets stimulated the expansion of industrial capacity,
above all in the United States and Japan, but also in countries such as India, Australia, and Latin America.
 The end of war did not imply an end to protection. Different tariff acts and restrictions are made.
 The Great Depression was of course a major reason for the adoption of severe protection, and not just in the
periphery.
 Beginning in 1932, there were several signs that at least some countries were trying to moderate, if not reverse, the
increase in protectionism of the previous year or two.
 Post war economic reintegration was supported by several factors, both technological and political.
Global Corporations
A corporation is an artificial being created by operation of law, having the right of succession and the
powers, attributes and properties expressly authorized by law or incident to its existence (Batas Pambansa Blg. 68 The
Corporation Code of The Philippines, Section 2 – Corporation defined).
According to Investopedia, a corporation is a legal entity that is separate and distinct from its owners. Corporations
enjoy most of the rights and responsibilities that an individual possesses; that is, a corporation has the right to enter into
contracts, loan and borrow money, sue and be sued, hire employees, own assets and pay taxes.
Based on Entrepreneur Asia Pacific Small Business Encyclopedia, corporation is a form of business operation that
declares the business as a separate, legal entity guided by a group of officers known as the board of directors
The Contemporary Global Corporation

 A global corporation is generally referred to as a multinational corporation (MNC), transnational corporation
(TNC), international company.
 An enterprise that engages in activities which add value (manufacturing, extraction, services, marketing,
etc) in more than one country (United Nations Centre On Transnational Corporations, 1991). MNCs place
multiple production facilities in multiple countries under the control of a single corporate structure (Oatley,
International Political Economy 5th Edition).
 A multinational corporation (MNC) is a company that operates in more than one country. Generally,
multinational corporations consist of separate companies (called subsidiaries) in different countries, all of
which answer to a central office located in the firm’s home (Riggs, Everyday Finance: Economics, Personal
Money Management, and Entrepreneurship
The Difference between 20th Century and Contemporary Multinational Corporations

 The MNCs of the post WW2 period are different from those of earlier periods in being more focused on
manufacturing and services than on extraction of raw materials and commodities (Dicken, 2015) and more
likely to be financed by a combination of foreign direct investment (FDI) and local capital rather than
international portfolio investments (Gilpin 1975). In addition, contemporary MNCs are the predominant owners
of proprietary technology. MNCs account for at least 50 percent of R&D spending worldwide (Keller 2009; Zeile
2014). In the United States and elsewhere, most patents are awarded to MNCs (Florida 2005; OECD 2008). In

the last two decades of the twentieth century, competing MNCs from a growing number of economies have
created geographically dispersed “value chains” to take advantage of lower R&D, production, and distribution
costs made possible by lower barriers to trade and investment flows (Borrus and Zysman 1997; Ernst and Kim
2002; Gereffi 1996; Gereffi et al 2005; Sturgeon 2002; Sturgeon 2007; Sturgeon and Gereffi 2009).
Activities of Multinational Corporations

 International companies are importers and exporters, typically without investment outside of their home country;
 Multinational companies have investment in other countries, but do not have coordinated product offerings in
each country. They are more focused on adapting their products and services to each individual local market.
 Transnational companies are more complex organizations which have invested in foreign operations, have a
central corporate facility but give decision-making, research and develop (R&D) and marketing powers to each
individual foreign market.
Tactics of Multinational Corporations
Foreign Direct Investment

 occurs when a firm based in once country builds a new plant or a factory or purchases existing one in a second
country a national corporation thus becomes an MNC by making a foreign direct investment. As consequence, the
world's stock of FDI, the total amount of foreign investment in operation has grown from 692.5 billion dollars in
1980 to 16.2 trillion dollars in 2008 (United Nations Conference on Trade and Development 2009,251) 2,300
percent increase in less that 30 years.
Types of FDI
Horizontal Integration
 occurs when firms creates multiple production of facilities each of which produces the same good or goods. Firms
integrate horizontally when a cost advantage is gained by placing a number of plants under common administrative
control. Intangible asset can be based on patented process or design. These assets are difficult to sell to other
firms at a price that accurately reflect their true value that's why firms horizontally integrate.
 Vertical integration refers to instances in which firms internalize their transaction for intermediate goods. An
intermediate good is an output of one production process that serves as an input into another production process.
Specific asset is an investment that is dedicated to a particular long-term economic relationship. By internalizing
transactions involving specific assets, therefore, vertical integration enables welfare-improving investments.
Contributions of Multinational Corporations

The possible benefits of a multinational investing in a country may include:
 Improving the balance of payments - inward investment will usually help a country's balance of payments situation.
The investment itself will be a direct flow of capital into the country and the investment is also likely to result in
import substitution and export promotion. Export promotion comes due to the multinational using their production
facility as a basis for exporting, while import substitution means that products previously imported may now be
bought domestically.
 Providing employment - FDI will usually result in employment benefits for the host country as most employees will
be locally recruited. These benefits may be relatively greater given that governments will usually try to attract firms
to areas where there is relatively high unemployment or a good labor supply.
 Source of tax revenue - profits of multinationals will be subject to local taxes in most cases, which will provide a
valuable source of revenue for the domestic government.
 Technology transfer - multinationals will bring with them technology and production methods that are probably new
to the host country and a lot can therefore be learnt from these techniques. Workers will be trained to use the new
technology and production techniques and domestic firms will see the benefits of the new technology. This process
is known as technology transfer.
 Increasing choice - if the multinational manufactures for domestic markets as well as for export, then the local
population will gain form a wider choice of goods and services and at a price possibly lower than imported
substitutes.

 National reputation - the presence of one multinational may improve the reputation of the host country and other
large corporations may follow suite and locate as well
Issues of Multinational Corporation

 Environmental impact - multinationals will want to produce in ways that are as efficient and as cheap as
possible and this may not always be the best environmental practice. They will often lobby governments hard to
try to ensure that they can benefit from regulations being as lax as possible and given their economic
importance to the host country, thislobbying will often be quite effective.
 Uncertainty - multinational firms are increasingly 'footloose'. This means that they can move and change at very
short notice and often will. This creates uncertainty for the host country.
 Increased competition - the impact the local industries can be severe, because the presence of newly arrived
multinationals increases the competition in the economy and because multinationals should be able to produce
at a lower cost.
 Influence and political pressure - multinational investment can be very important to a country and this will often
give them a disproportionate influence over government and other organizations in the host country. Given their
economic importance, governments will often agree to changes that may not be beneficial for the long-term
welfare of their people
 Transfer pricing - multinationals will always aim to reduce their tax liability to a minimum. One way of doing this
is through transfer pricing. The aim of this is to reduce their tax liability in countries with high tax rates and
increase them in the countries with low tax rates. They can do this by transferring components and part-finished
goods between their operations in different countries at differing prices. Where the tax liability is high, they
transfer the goods at a relatively high price to make the costs appear higher. This is then recouped in the lower
tax country by transferring the goods at a relatively lower price. This will reduce their overall tax bill.
 Low-skilled employment - the jobs created in the local environment may be low-skilled with the multinational
employing expatriate workers for the more senior and skilled roles.
 Health and safety - multinationals have been accused of cutting corners on health and safety in countries where
regulation and laws are not as rigorous.
 Export of Profits - large multinational are likely to repatriate profits back to their 'home country', leaving little
financial benefits for the host country.
 Cultural and social impact - large numbers of foreign businesses can dilute local customs and traditional
cultures. For example, the sociologist George Ritzer coined the term McDonaldization to describe the process
by which more and more sectors of American society as well as of the rest of the world take on the
characteristics of a fast-food restaurant, such as increasing standardization and the movement away from
traditional business approaches.
III. THE GLOBAL INTERSTATE SYSTEM
Global Interstate System

It is the whole system of human interactions. The modern world-system is structured politically as an interstate
system – a system of competing and allying states. Political Scientists commonly call this the international
system, and it is the main focus of the field of International Relations.

Institution that govern international Relations
UNITED NATION
 United States President FRANKLIN ROOSEVELT coined the name united nations that was used in the
declaration of United Nation on 1 of January 1942. UN means allies to fight against the Axis Powers in
the Second World War II. Only 26 nation’s representatives pledge their governments to:
1. Each Government pledges itself to employ its full resources, military or economic, against those members of the
tripartite pact and its adherents with which such government is at war.
2. Each Government pledges itself to cooperate with the Governments signatory hereto and not to make a separate
armistice or peace with the enemies.
International Financial Institutions

2017
• - World Bank
• - International Monetary Fund
• - Asian Development Bank
• - African Development Bank
GLOBALISM AND INTERNATIONALISM
WHAT IS GLOBALISM?
Globalization refers to any activity that brings the people, cultures, and economies of different countries closer
together. In business, "globalization" (also called "going global") refers to practices by which organizations become more
tightly connected with their customers and partners around the world.
A few examples of globalization in the world of business:
 Online marketplaces like eBay and Amazon make it easy to buy products from businesses or individuals on the
other side of the planet. Even products sold in traditional brick-and-mortar stores like Target often make stops
in several different countries before reaching their final destinations.
 Consumer electronics, for example, are commonly sourced from raw materials in India, made in China, then
sold in America.
 Many large restaurant chains, like McDonald's, operate in dozens of countries. McDonald's specifically has
franchises in upwards of one hundred countries, and diners around the world recognize its brand and logo.
 Netflix operates in more than 190 countries and customizes content offerings for individual markets with
subtitles and programming in local languages.
What Is Internationalization?
Internationalization is a corporate strategy that involves making products and services as adaptable as possible, so
they can easily enter different national markets. Internationalization often requires the assistance of subject-matter experts,
technical experts, and people with international experience. Industry experts sometimes shorten the term
"internationalization" to "i18n" (18 represents the number of characters in the word).
UNITED NATION

ROLES AND FUNCTION OF UNITED NATIONS

• UN provides and manages the framework for bringing together the world’s leaders to tackle the pressing problems of the
day for the survival, development and welfare of all people everywhere.
 United Nations provides a fulcrum for analysis as the most universal and legitimate organizational framework
 UN can and should be the locus of multilateral diplomacy and collective action to sole common problems
Main gaps that UN meets in the 21st Century

➢ Knowledge
➢ Norms
➢ Policy
➢ Institution
➢ Compliance
4 ESSENTIAL ROLES IN IDENTIFYING AND DIAGNOSING PROBLEMS AND THEREBY FILLING GAPS :
➢ MANAGING KNOWLEDGE
The first step in eventually addressing a problem that goes beyond the capacity of any state is to recognize its
existence. Next is to collect solid data about the nature of problem and understand its causes to explain the
problem.
 UN-sponsored world conference, heads of government summits, blue-ribbon commissions and panels
have been used to: frame issues, outline choices, make decisions, etc.
➢ DEVELOPING NORMS
 UN helps to solidify a new norm of behavior, often through the summit conferences and international
panels and commissions. New norms need to be articulated , disseminated, and institutionalized UN as a
forum has promulgated norms with the consent of most member states.
➢ FORMULATING RECOMMENDATIONS
 Formulate a range of possibilities about how governments and their citizens and IGOs can change
behaviour. The UN’s ability to convene and consult widely plays an enormous part in its ability to formulate
recommendations for specific policies, institutional arrangements and regimes that follow.
➢ INSTITUTIONALIZING IDEAS
 Once knowledge has been acquired, norms articulated and policies formulated, an existing institution can
oversee their implementation and monitoring. A policy still needs to be implemented and additional
complications and shortcomings might appear during implementation because some people cheat,
challenge and defy the norms and law.
CHALLENGES OF GLOBAL GOVERNANCE IN THE TWENTY-FIRST CENTURY

The world has changed enormously since the creation of the United Nations. There are four times as many state
actors, a correspondingly greater number and proportion of non-state actors, and a tremendous diversity in the types of
state and non-state actors compared to 1945. There has been a matching proliferation in the number, nature and types of
threats to national security and world peace alike. Consequently, the growing number and types of actors in world affairs
have to grapple with an increasing number, range and complexity of issues in an increasingly networked, deeply intertwined
but also more fragmented world.
The Challenge Of Global Governance Is Six fold:

1. Evolution Of International Organizations

✓ The evolution of international organizations to facilitate robust global responses lags behind the emergence of
collective action problems.
2. Most Pressing Problems Are Global In Scope
✓ The most pressing problems – nuclear weapons, terrorism, pandemics, food, water and fuel scarcity, climate
change, and agricultural trade – are global in scope and require global solutions: problems without passports in
search of solutions without passports.
✓ But the policy authority and legal capacity for coercive mobilization of the required resources for tackling them
remain vested in states.
3. Disconnection Between The Distribution Of Decision‐Making Authority In International Institutions
✓ There is a disconnection between the distribution of decision‐making authority in international institutions and the
distribution of military, diplomatic and economic power in the real world.
4. Disconnection Between The Concentration Of Decision‐Making Authority In Intergovernmental Forums
✓ There is also a disconnection between the concentration of decision‐making authority in intergovernmental
forums and the diffusion of decision‐shaping influence among non-state actors like markets, corporations and civil
society actors.
5. Mutually Undermining Gap Between Legitimacy And Efficiency
✓ There is a mutually undermining gap between legitimacy and efficiency. Precisely what made the G8 summits
unique and valuable – informal meetings between a small number of the world’s most powerful government leaders
behind closed doors on a first name basis, without intermediaries and with no notes being taken – is what
provoked charges of hegemonism, secrecy, opaqueness, and lack of representation and legitimacy.
✓ The very feature that gives the United Nations its unique legitimacy, universal membership, makes it an
inefficient body for making, implementing and enforcing collective decisions.
6. Colliding Worldviews Of The Global North And South
✓ During the Cold War, the main axis around which world affairs rotated was East– West. Today this has morphed
into a North–South axis.
✓ The Copenhagen conference on climate change was suboptimal in outcome in part because of the colliding
worldviews of the global North and South
IV. CONTEMPORARY GLOBAL GOVERNANCE

What is Global Governance?
 Global governance mechanisms can be good, bad, effective, or ineffective.
 This course aims to be value-neutral on the idea of global governance.
UNITED NATION
ROLES AND FUNCTION OF UNITED NATIONS

• UN provides and manages the framework for bringing together the world’s leaders to tackle the pressing problems
of the day for the survival, development and welfare of all people everywhere.
• United Nations provides a fulcrum for analysis as the most universal and legitimate organizational framework

• UN can and should be the locus of multilateral diplomacy and collective action to sole common problems
Main gaps that UN meets in the 21st Century

➢ Knowledge
➢ Norms
➢ Policy
➢ Institution
➢ Compliance
4 ESSENTIAL ROLES IN IDENTIFYING AND DIAGNOSING PROBLEMS AND THEREBY FILLING GAPS:
➢ MANAGING KNOWLEDGE
The first step in eventually addressing a problem that goes beyond the capacity of any state is to recognize
its existence. Next is to collect solid data about the nature of problem and understand its causes to explain the
problem
□ UN-sponsored world conference, heads of government summits, blue-ribbon commissions and panels have been
used to: frame issues, outline choices, make decisions, etc.
➢ DEVELOPING NORMS
UN helps to solidify a new norm of behavior often through the summit conferences and international panels and
commissions. New norms need to be articulate, disseminated, and institutionalized UN as a forum has promulgated
norms with the consent of most member states
➢ FORMULATING RECOMMENDATIONS
Formulate a range of possibilities about how governments and their citizens and IGOs can change behavior
The UN’s ability to convene and consult widely plays an enormous part in its ability to formulate recommendations
for specific policies, institutional arrangements and regimes that follow
➢ INSTITUTIONALIZING IDEAS
Once knowledge has been acquired, norms articulated and policies formulated, an existing institution can oversee
their implementation and monitoring. A policy still needs to be implemented and additional complications and
shortcomings might appear during implementation because some people cheat, challenge and defy the norms and
law.
CHALLENGES OF GLOBAL GOVERNANCE IN THE TWENTY-FIRST CENTURY

The world has changed enormously since the creation of the United Nations. There are four times as many
state actors, a correspondingly greater number and proportion of non-state actors, and a tremendous diversity in
the types of state and non-state actors compared to 1945. There has been a matching proliferation in the number,
nature and types of threats to national security and world peace alike.
Consequently, the growing number and types of actors in world affairs have to grapple with an increasing
number, range and complexity of issues in an increasingly networked, deeply intertwined but also more fragmented
world.
• The United Nations in Global Governance: Rebalancing Organized
THE RELEVANCE OF THE STATE AMIDST GLOBALIZATION
Globalization
Globalization is a complex phenomenon, which encompasses a great variety of tendencies and trends in
the economic, social and cultural spheres. For purposes of simplicity, it may be described as increasing and intensified
flows between countries of goods, services, capital, ideas, information and people which produce cross-border integration of
a number of economic, social and cultural activities.
State
 The state is a form of human association distinguished from other social groups by its purpose, the
establishment of order and security; its methods, the laws and their enforcement; its territory, the area of
jurisdiction or geographic boundaries; and finally by its sovereignty.
Greater economic and social interdependence seems to affect national-decision making
processes in two fundamental ways:
▪ It calls for a transfer of decisions to the international level

▪ It also requires many decisions to be transferred to local levels of government

This implies that “public policies are undertaken at different levels". Thereby, globalization entails complex decision-
making processes, which take place at different levels, namely sub-national, national and global, paving the way to a
growing multi-layered system of governance. Some argue that the State may only adjust to globalization, but not have an
active role in it. Some believe that the State will become obsolete. Still, the State remains the key actor in the domestic as
well as international arenas.
▪ The many “challenges that we confront today are beyond the reach of any State to meet on its own. At the
national level we must govern better, and at the international level we must learn to govern better together. Effective States
are essential for both tasks, and their capacity for both needs strengthening". It is still States, collectively or singly, that set
the rules of the game, that enter into agreements with other States, and that make policies which shape national and global
activities, and the agenda of integration; though this is true in principle, in reality the problem of capacity inadequacy of
individual States has become clearly pronounced.
The argument that globalization produces a reduction of the Welfare State and therefore a cut in social spending is
not supported by evidence. On the contrary, a strong democratic State is needed to redistribute the benefits of globalization
and to minimize the costs that some segments of the population may bear. To put it more simply, globalization may require
that the State improve its capacity to deal with greater openness, but it does not seem to undermine its size nor its
fundamental role within the national and international landscapes.
▪ To be sure, the State remains central to the well-being of its citizens and to the proper management of social and
economic development.
▪ The State is also responsible for adopting policies, which are conducive to greater economic integration.
▪ We should not forget that further global integration can be reversed by state policies inimical to openness, as
occurred between the two World Wars.
▪ In brief, globalization does not reduce the role of the nation-State, but redefines it given the pressures and
responses it must give at the local, national and international levels.
Lesson 3
TOPIC: A WORLD OF REGIONS
DURATION: 2 WEEKS
Global Divides: The North and the South (focus on Latin America)

would be to understand some of the dynamics of how incoming individuals interact within the broader organizational
context. An organization, of course, exists before a particular person joins it and continues to exist long after he or she has
left. Therefore, the organization itself represents a crucial perspective from which to view organizational behavior. For
instance, the consultant studying turnover would also need to study the structure and culture of Texas Instruments. An
understanding of factors such as the performance evaluation and reward systems, the decision-making and communication
patterns, and the design of the firm itself can provide additional insight into why some people decide to stay while others
elect to leave.
Clearly, the field of organizational behavior can be both exciting and complex. Myriad variables and concepts
impact the interactions described, and together these factors can greatly complicate a manager’s ability to understand,
appreciate, and manage others in an organization. However, they can also provide unique opportunities to enhance
personal and organizational effectiveness. The key, of course, is understanding. To provide some groundwork for
understanding, we look first at the historical roots of organizational behavior.
Historical Roots of Organizational Behavior
Many disciplines, such as physics and chemistry, are literally thousands of years old. Management has also been
around in one form or another for centuries. For example, the writings of Aristotle and Plato abound as references and
examples of management concepts and practices. But because serious interest in the study of management did not emerge
until the turn of the twentieth century, organizational behavior is only a few decades old. One reason for the relatively late
development of management as a scientific field is that very few large business organizations existed until around a
hundred years ago. Although management is just as important to a small organization as it is to a large one, large firms
provided both a stimulus and a laboratory for management research. Second, many of the initial players interested in
studying organizations were economists. Economists initially assumed that management practices are by nature efficient
and effective; therefore, they concentrated on higher levels of analysis such as national economic policy and industrial
structures rather than on the internal structure of companies.
Scientific Management
One of the first approaches to the study of management, popularized during the early 1900s, was scientific
management. Individuals who helped develop and promote scientific management included Frank and Lillian Gilbreth
(whose lives are portrayed in a book and a subsequent movie, Cheaper by the Dozen), Henry Gantt, and Harrington
Emerson. But the person commonly associated with scientific management is Fredric W. Taylor.

Early in his life, Taylor developed an interest in efficiency and productivity. While working as a foreman at Midvale
Steel Company in Philadelphia from 1878 to 1890, he noticed a phenomenon, which he named “soldiering”—employees’
working at a pace much slower than their capabilities. Because managers had never systematically studied jobs in the plant
and, in fact, had very little idea on how to gauge worker productivity, they were completely unaware of this phenomenon.
To counteract the effects of soldiering, Taylor developed several innovative techniques. First, he scientifically
studied all the jobs at the Midvale plant and developed a standardized method for performing each one. He also installed a
piece-rate pay system in which each worker was paid for the amount of work he completed during the workday rather than
for the time spent on the job. (Taylor believed that money was the only significant motivational factor in the workplace.)
These two innovations resulted in a marked increase in productivity and serve as the foundation of scientific management
as we know it.
After leaving Midvale, Taylor spent several years working as a management consultant for industrial firms. At
Behlehem Steel Company, he developed several efficient techniques for loading and unloading rail cars. At Simonds Rolling
Machine Company, he redesigned jobs, introduced rest breaks to combat fatigue, and implemented a piece-rate pay
system. In every case, Taylor claimed his ideas and methods greatly improved worker output. His book, Principles of
Scientific Management, published in 1911, was greeted with enthusiasm by practicing managers and quickly became a
standard reference.
Scientific management quickly became a mainstay of business practice. It facilitated job specialization and mass
production, consequently influencing the U.S. business system in profound ways. Taylor had his critics, though. Laborers
opposed scientific management because of its explicit goal of getting more output from workers. Congress investigated
Taylor’s methods and ideas because some argued that his incentive system would dehumanize the workplace and reduce
workers to little more than drones. Later theorists recognized that Taylor’s views on employee motivation were inadequate
and narrow. And recently there have been allegations that Taylor falsified some of his research findings and paid someone
to do his writing for him. Nevertheless, scientific management represents an important milestone in the development of
management thought.
Classical Organization Theory
During the same era, another perspective on management theory and practice was also emerging. Generally
referred to as classical organization theory, this perspective is concerned with structuring organizations effectively. Whereas
scientific management studied how individual workers could be made more efficient, classical organization theory focused
on how a large number of workers and managers could be most effectively organized into an overall structure.
Major contributors to classical organization theory included Henri Fayol, Lyndall Urwick, and Max Weber. Weber,
the most prominent of the three, proposed a “bureaucratic” form of structure that he believed would work for all
organizations. Although today the term bureaucracy conjures up images of paperwork, red tape, and inflexibility, Weber’s
model of bureaucracy embraced logic, rationality, and efficiency. Weber assumed that the bureaucratic structure would
always be the most efficient approach. (Such a blanket prescription represents what is now called a universal approach.) A
bureaucracy is an organizational structure in which tasks are specialized under a given set of rules and a hierarchy of
authority. Division of labor is the separation of work loads into small segments to be performed by one or more people. In a
bureaucracy, tasks are assigned through the division of labor. A set of outlined procedures exists for each job. Because
these procedures are invariable, the tasks assigned for each job become routine for the employee. Thus, creativity is low.
In a bureaucracy, the standards for evaluating job performance do not need to be updated because required tasks
never change. However, this lack of variation leads to an impersonal work environment, lacking incentives for extraordinary
task performance and ultimately limiting the growth potential of individual employees.
In contrast to Weber’s views, contemporary organization theorists recognize that different organizational structures
may be appropriate in different situations. As with scientific management, however, classical organization theory played a

major role in the development of management thought, and Weber'’ ideas and the concepts associated with his
bureaucratic structure are still interesting and relevant today.
THE EMERGENCE OF ORGANIZATIONAL BEHAVIOR
The central themes of both scientific management and classical organization theory are rationality, efficiency, and
standardization. The roles of individuals and groups in organizations were either ignored altogether of given only minimal
attention. A few early writers and managers, however, recognized the importance of individual and social processes in
organizations.
PRECURSORS OF ORGANIZATIONAL BEHAVIOR
In the early nineteenth century, Robert Owen, a British industrialist, attempted to improve the condition of industrial
workers. He improved working conditions, raised minimum ages for hiring children, introduced meals for employees, and
shortened working hours. In the early twentieth century, the noted German psychologist Hugo Munsterberg argued that the
field of psychology could provide important insights into areas such as motivation and the hiring of new employees. Another
writer in the early 1900s, Mary Parker Follett, believed that management should become more democratic in its dealings
with employees. An expert in vocational guidance, Follett argued that organizations should strive harder to accommodate
their
employees’ human needs.
The views of Owen, Mansterberg, and Follett, however, were not widely shared by practicing managers. Not until
the 1930s did notable change occur in management’s perception of the relationship between the individual and the
workplace. At that time, a series of now classic research studies led to the emergence of organizational behavior as a field
of study.
THE HAWTHORNE STUDIES
The Hawthorne studies were conducted between 1927 and 1932 at Western Electric’s Hawthorne plant near
Chicago. (General Electric initially sponsored the research but withdrew its support after the first study was finished.)
Several researchers were involved, the best known being Elton Mayo and Fritz Roethlisberger, Harvard faculty members
and consultants, and William Dickson, chief of Hawthorne’s Employee Relations Research Department.
The first major experiment at Hawthorne studied the effects of different levels of lighting on productivity. The
researchers systematically manipulated the lighting in the area in which a group of women worked. The group’s productivity
was measured and compared with that of another group (the control group) whose lighting was left unchanged. As lighting
was increased for the experimental group, productivity went up—but, interestingly, so did the productivity of the control
group. Even when lighting was subsequently reduced, the productivity of both groups continued to increase. Not until the
lighting had become almost as dim as moonlight did productivity start to decline. This led the researchers to conclude that
lighting had no
relationship to productivity—and at this point General Electric withdrew its sponsorship of the project!
In another major experiment, a piecework incentive system was established for a nineman group that assembled
terminal banks for telephone exchanges. Proponents of scientific management expected each man to work as hard as he
could to maximize his personal income. But the Hawthorne researchers found instead that the group as a whole established
an acceptable level of output of its members. Individuals who failed to meet this level were dubbed “chiselers,” and those
who exceeded it by too much were branded “rate busters.” A worker who wanted to be accepted by the group could not
produce at too high or too low a level. Thus, as a worker approached the accepted level each day, he slowed down to avoid
overproducing.
After a follow-up interview program with several thousand workers, the Hawthorne researchers concluded that the
human element in the workplace was considerably more important that previously believed. The lighting experiment, for

example, suggested that productivity might increase simply because workers were singled out for special treatment and
thus perhaps felt more valued or more pressured to perform well. In the incentive system experiment, being accepted as a
part of the group evidently meant more to the workers than earning extra money. Several other studies supported the
general conclusion that individual and social processes are too important to ignore.
Like the work of Taylor, the Hawthorne studies have recently been called into question. Critics cite deficiencies in
research methods and offer alternative explanations of the findings. Again, however, these studies were a major factor in
the advancement of organizational behavior and are still among its most frequently cited works.
HUMAN RELATIONS MOVEMENT
The Hawthorne studies created quite a stir among managers, providing the foundation for an entirely new school of
management thought that came to be known as the human relations movement. The basic premises underlying the human
relations movement are that people respond primarily to their social environment, that motivation depends more on social
needs than on economic needs, and that satisfied employees work harder than unsatisfied employees. This perspective
represented a fundamental shift away form the philosophy and values of scientific management and classical organization
theory.
The behavioral theory of management holds that all people (including employees) have complex needs, desires,
and attitudes. The fulfillment of needs is the goal toward which employees are motivated. Effective leadership matches
need-fulfillment rewards with desired behaviors (tasks) that accomplish organizational goals. The values of the human
relationists are perhaps best exemplified by the works of Douglas McGregor and Abraham Maslow. McGregor is best known
for his classic book The Human Side of Enterprise, in which he identified two opposing perspectives that he believed typified
managerial views of employees. Some managers, McGregor said, subscribed to what he labeled Theory X. Theory X, which
takes a pessimistic view of human nature and employee behavior, is in many ways consistent with the tenets of scientific
management. A much more optimistic and positive view of employees is found in Theory Y. Theory Y, which is generally
representative of the human relations perspective, was the approach McGregor himself advocated. Assumptions of Theory
X and Theory Y are summarized in Exhibit 2.
In 1943, Abraham Maslow published a pioneering psychological theory applicable to employee motivation that
became well known and widely accepted among mangers. Maslow’s theory assumes that motivation arises from a
hierarchical series of needs. As the needs of each level are satisfied, the individual advances to the next level. Although the
Hawthorne studies and the human relations movement played major roles in developing the foundations for the field of
organizational behavior, some of the early theorists’ basic premises and assumptions were found to be incorrect. For
example, most human relationists believed that employee attitudes such as job satisfaction are the major causes of
employee behaviors such as job performance. However, this is usually not the case at all. Also, many of the human
relationists’ views were unnecessarily limited and situation specific. As a result, there was still plenty of room for refinement
and development in the emerging field of human behavior in organizations.

Toward Organizational Behavior
Most scholars would agree that organizational behavior began to emerge as a mature field of study in the late
1950s and early 1960s. That period saw the field’s evolution from the simple assumptions and behavioral models of the
human relationists to the concepts and methodologies of a scientific discipline. Since that time, organizational behavior as a
scientific field of inquiry has made considerable strides, although there have been occasional steps backward as well.
Many of the ideas discussed in this book have emerged over the past two decades. We turn now to contemporary
organizational behavior.
CONTEMPORARY ORGANIZATIONAL BEHAVIOR
Contemporary organizational behavior has two fundamental characteristics that warrant special discussion. It also
generally accepts a set of concepts to define its domain.
CHARACTERISTICS OF THE FIELD
Researchers and managers who use concepts and ideas from organizational behavior must recognize that it has an
interdisciplinary focus and a descriptive nature; that is, it draws from a variety of fields and attempts to describe behavior (as
opposed to prescribing how behavior can be changed in consistent and predictable ways).
An Interdisciplinary Focus In many ways, organizational behavior synthesizes several other fields of study.
Psychology, especially organizational psychology, is perhaps the greatest contributor to the field of organizational behavior.
Psychologists study human behavior, whereas organizational psychologists specifically address the behavior of people in
organizational settings. Many of the concepts that interest psychologists, such as individual differences and motivation, are
also central to studying of organizational behavior.
Sociology also has had a major impact on the field of organizational behavior. Sociologists study social systems
such as families, occupational classes, and organizations. Because a major concern of organizational behavior is the study
of organization structures, the field clearly overlaps with areas of sociology that focus on the organization as a social
system.

Anthropology is concerned with the interactions between people and their environments, especially their cultural
environment. Culture is major influence on the structure of organizations as well as on the behavior of individual people
within organizations.
Political science also interests organizational behaviorists. We usually think of political science as the study of
political systems such as governments. But themes of interest to political scientists include how and why people acquire
power, political behavior, decision making, conflict, the behavior of interest groups, and coalition formation. These are also
major areas of interest in organizational behavior.
Economists study the production, distribution, and consumption of goods and services. Organizational behaviorists
share the economist’s interest of topics such as labor market dynamics, productivity, human resource planning and
forecasting, and cost-benefit analysis.
Engineering has also influenced the field of organizational behavior. Industrial engineering in particular has long
been concerned with work measurement, productivity measurement, work flow analysis and design, job design, and labor
relations. Obviously these areas are also relevant to organizational behavior.
Most recently, medicine has influenced organizational behavior in connection with study of human behavior at work,
specifically in the area of stress. Increasing research is showing that controlling the causes and consequences of stress in
and out of organizational settings is important for the well-being of the individual as well as that of the organization.
A Descriptive Nature A primary goal of organizational behavior is to describe relationships between two or more
behavioral variables. The theories and concepts of the field, for example, cannot predict with certainty that changing a
specific set of workplace variables will improve an individual employee’s performance by a certain amount. At best, theories
can suggest that certain general concepts or variables tend to be related to one another in particular settings. For instance,
research might indicate that in one organization, employee satisfaction and individual perceptions of working conditions
correlate positively. Nevertheless, we may not know if better working conditions lead to more satisfaction, if more satisfied
people see their jobs differently from unsatisfied people, or if both satisfaction and perceptions of working conditions are
actually related through other variables. Also, the observed relationship between satisfaction and perceptions of working
conditions may be considerably stronger, weaker, or nonexistent in other settings.
Organizational behavior is descriptive for several reasons: the immaturity of the field, the complexities inherent in
studying human behavior, and the lack of valid, reliable, and accepted definitions and measures. Whether the field will ever
be able to make definitive predictions and prescriptions is still an open question. But the value of studying organizational
behavior nonetheless is firmly established. Because behavioral processes pervade most managerial functions and roles,
and because the work of organizations is done primarily by people, the knowledge and understanding gained from the field
can help managers in significant ways.
The Importance of Organizational Behavior
Although the importance of organizational behavior may be clear, we should still take a few moments to emphasize
certain points. People are born and educated in organizations, acquire most of their material possessions from
organizations, and die as members of organizations. Many of our activities are regulated by organizations called
governments. And most adults spend the better part of their lives working in organizations. Because organizations influence
our lives so powerfully, we have every reason to be concerned about how and why those organizations function. In our
relationships with organizations, we may adopt any one of several roles or identities. For example, we can be consumers,
employees, or investors. Because most readers of this book are either present of future managers, we adopt a managerial
perspective throughout. Organizational behavior can greatly clarify the factors that affect how managers manage. It is the
field’s job to describe the complex human context in which managers work and to define the problems associated with that
realm. The value of organizational behavior is that it isolates important aspects of the manager’s job and offers specific
perspectives on the human side of management: people as organizations, people as resources, and people as people.

Contextual Perspectives on Organizational Behavior
Several contextual perspectives have increasingly influenced organizational behavior: the systems approach and
contingency perspectives, the interactional view, and the popular-press perspectives. Many of the concepts and theories we
discuss in the chapters that follow reflect these perspectives; they represent basic points of view that influence much of our
contemporary thinking about behavior in organizations.
The interactional view implies that simple cause-and-effect descriptions of organizational phenomena are not
enough. For example, one set of research studies may suggest that job changes will lead to improved employee attitudes.
Another set of studies may propose that attitudes influence how people perceive their jobs in the first place. Both positions
are probably incomplete: employee attitudes may influence job perception, but these perceptions may in turn influence
future attitudes. Because interactionalism is a fairly recent contribution to the field, it is less prominent in the chapters that
follow than the systems and contingency theories. Nonetheless, the interactional view appears to offer many promising
ideas for future development in the field. While some of the evidence provided by current research is open to a variety of
different interpretations, they have focused popular attention on many of the important issues and problems confronting
business today. As a result, managers of the 1990s better appreciate both their problems and their prospects in working
toward more effective organizational practices in the years to come
REFERENCE/S (minimum of 5 references)
Bautista, H. J. (2006). Understanding and Managing Organizational Behavior. Los Alamitos: Delta Publishing Company.
Hollenbeck, J. R. (2010). Organizational behavior: Securing competitive advantage. New York: Routledge.
-https://www.youtube.com/watch?v=MnvWxZhsvKA
-https://www.youtube.com/watch?v=MnvWxZhsvKA
-https://www.youtube.com/watch?v=yyi5KbAp8TE
ACTIVITY #1
HEAVENLY NOTE: HONESTY BUILDS INTEGRITY

NAME DATE
YEAR & SECTION SCORE:
DIRECTION: Write a brief introduction on how you understand individual behavior in organization and the ability to lead
people to achieve more effectively toward increased organizational performance..
Rubric:
a) Content : 40%
b) Understanding/Application : 20%
c) Original Thinking : 20%
d) Grammar and mechanics : 25%
ACTIVITY #2
HEAVENLY NOTE: HONESTY BUILDS INTEGRITY
NAME DATE
YEAR & SECTION SCORE:
DIRECTIONS: Complete the crossword by filling in a word that fits each clue.

ACROSS 4. The positioning of packages, containers, portable tanks, packaging,

vehicles, shipborne barges, other cargo transport units and bulk cargoes on
2. Includes harbor fees, tonnage and wharfage dues, berthing charges, and board ships, in warehouses sheds or other places
port dues and any other dues or fees imposed by virtue of existing law or PD
857. 5. A strong post on a ship or a dock holding a hawser fast
7. A portable platform or deck generally about 6ft x 4ft on which goods can 6. Loading of goods to a container
be attached to form a unit load which can be transported usually by a
mechanical appliance such as forklift trucks 10. Substances, which, by chemical action, will cause severe damage when
in contact with living tissue, or in the case of leakage, will materially damage
8. Any structure built into the sea but not parallel to the coastline and or even destroy freight or the means of transport.
includes any stage stair, landing place, landing stage, jetting floating barge
and any bridge or other works connected therewith 11. Includes locks, cuts, entrances, graving dock, incline planes, shipways,
quays
9. Means a continuous structure built parallel to along the margin of the sea
or alongside riverbanks, canals or waterways where vessels may lie 13. To secure a vessel alongside the berth by means of mooring ropes.
alongside to receive or discharge cargo, embark or disembark passengers,
14. Includes every sort of boat or craft or other artificial contrivance used or
or lie at rest.
capable of being used as a means of transportation on water.
10. A cargo vessel designed and constructed primarily to carry containers.
12. Means a building or shed used for the storage of cargo.
15. The load of a vessel or goods and merchandise put on board a ship to be
carried to a certain port.
16. Unloading goods from a container.
17. Means any rates or charges including any toll or rent under existing law
or imposed by the Authority by virtue of this Decree for facilities used or
services rendered
1 8. The maneuvering of a vessel from the anchorage or pilot station to a

berth, including the action to make fast the vessel alongside.
DOWN
1. A pad or cushion of rope, wood, old tires, etc. hung over a ship's side to
protect it in docking
3. Means a naturally or artificially enclosed or nearly enclosed body of water

in free communication with the sea.

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Lemery Colleges, Inc.

A. Bonifacio St., Brgy. Bagong Sikat, Lemery, Batangas

Academic Year 2020-2021

An Instructional Module and

CONTEMPORARY WORLD ▪ PAGE 1

L- Love of God and Country

PROGRAM EDUCATIONAL OBJECTIVES

CONTEMPORARY WORLD ▪ PAGE 2

2. Analyze global issues in relation to Filipinos and the Philippines

CONTEMPORARY WORLD ▪ PAGE 3

LESSON TOPICS PAGE

1 Introduction to the Study of Globalization

2 The Structures of Globalization 15

CONTEMPORARY WORLD ▪ PAGE 4

FLEXIBLE LEARNING DESIGN WORKSHEET

CONTEMPORARY WORLD ▪ PAGE 5

CONTEMPORARY WORLD ▪ PAGE 6

CONTEMPORARY WORLD ▪ PAGE 7

 Identify the attributes

 Analyze the political,

CONTEMPORARY WORLD ▪ PAGE 8

CONTEMPORARY WORLD ▪ PAGE 9

Write a personal definition of globalization based on a concept map

Watch Lecture Video

CONTEMPORARY WORLD ▪ PAGE 10

Globalization motives are idealistic, as well as opportunistic, but the development of a

Competing Conceptions of Globalization

Globalization as a process, a condition, a system, a force, and age.

UNCTAD (United Nations Conference on Trade and Development)

 globalization is a closer integration of national economies through trade and financial

1. free movement of goods because of abolition of tariff – tax on imported goods.

3. free movement of persons because of abolition of visa restrictions

 migration and outsourcing of jobs

Globalization as the process of world shrinkage, of distances getting shorter, things

CONTEMPORARY WORLD ▪ PAGE 11

Globalization’s definition is complex, multifaceted because it deals with either

IT IS NOW BECOMING INCREASINGLY LIQUID.

BUT THIS IS MELTING.

 takes the shape of its container.

Videos uploaded on Youtube or FB are unstoppable once they become viral.

Space and time are crucial elements of globalization. Why?

The metaphor that could best describe globalization is liquidity.

Foods are being globalized.

Think of the different foreign cuisine patronized and consumed by Filipinos.

CONTEMPORARY WORLD ▪ PAGE 12

A Simple Globalization Definition

An Official Definition of Globalization by the World Health Organization (WHO)

What Is Globalization in the Economy?

What Is Globalization in Geography?

CONTEMPORARY WORLD ▪ PAGE 13

The Global Economy

 a historical process, the result of human innovation and technological progress

 Gills and Thompson (2006)- migration

 Silk Road- best known example of old-fashioned globalization

 1800s- industrial revolution

CONTEMPORARY WORLD ▪ PAGE 14

 World export to world Gross Domestic Product (GDP)

 1870 to 1913- golden age of globalization

 1913- trade equaled to 16-17 %

Transnational Corporations (TNCs)

 the major players of present-day global economy

Global commodity chain

The Modern World System