MODULE 1 ploughs, wheels and technologies of copper, bronze and iron
Lesson 1: Introduction to The Contemporary World |
Globalization
Why is Globalization an important subject in the
contemporary world?
While the importance of studying history is in avoiding
the repetition of the mistakes of the past, the study of the
contemporary world deals with the forces and pressures
resulting from the communication between man, geography,
and societies and how these ever-changing factors shape the
story of mankind.
Globalization is a policy both formal and informal
among participating countries. It is the removal of “artificial
barriers” such as tariff, quotas, and subsidies to let market
freer of the intensified flow of goods, services, technology,
information, human resources, and factors of production on the
world market. It is a consequence of modern development of
transport and communication means seen as a crucial channel
of international integration. Because of this, globalization is
best described as the expansion of the role of the markets
on a global level as all economies snowballing into
integration.
Introduction to The Contemporary World | Integration
As we have learned, Globalization may be defined in
just one word: “integration.”
This integration could be attributed to the fact that all
countries have scarcities and surpluses in products and
materials, depending on their geographical and topographical
features.
The scarcity of resources forced them to make
economic choices to fulfill their needs, pursued by enhancing
labor and education specialization to produce specialized
products leading to individual comparative advantages. As this
specialization creates a surplus, countries resort to marketing
their products to trading partners who are in a scarcity of the
same, creating mutual satisfaction.
In the 1980s, there was a surplus of salmon in Norway.
The government hired Bjorn Eirik to market this product to
the country most famous for eating fish: Japan. Listen to
the story of how the Norwegian salmon made itself
indispensable to Japanese culture.
IMPORTANT:
It must be highlighted that trade is not just limited to physical
products, but more importantly, exchanges of ideas, cultures,
and information. As the market became a binding force
between countries, furthering their specialization of products
and trade engagement. Another vital keyword in globalization
is competition. In the study of the contemporary world, this
must be approached as strategic management.
Lesson 2: Globalization: Its Meaning and Historical
Process |Part 1
The World History of Globalization- The classical
 
The formation of the “primary” World-System in the
Middle East approximately 9000-11,000 years ago was directly
connected with the Agricultural Revolution. It covered the
history of the territories of the Fertile of Crescent (Palestine,
Syria, Northern Iraq and Western Iran). But there was also
real informational connections through which the North African
and Eurasian regions systematically received the most
important innovations in agriculture and craftsmanship from the
Middle East, such as domesticated crops, cattle, horses,
metallurgy.
 
 Internal cohesion and connectivity of the World-System
occurred in the era of the agrarian empires. Between 1200
BCE and 200 CE numerous agrarian empires gained power
and achieved prosperity, such as the Hellenistic world, the
Roman Empire (covering the entire Mediterranean Basin),
the Persian Empire, the Maurya Empire, the Achaemenic
Empire, the Parthian Empire, the Kushan Empire, the
Maurya Empire and the Gupta Empire in northern India,
the Qin Empire and later the Han Empire in China. The
“circulatory system” of this enlarged World-System
comprised not only information exchanges, but also
the network of long-distance trade in luxury good. The Great
Silk Road became the central “artery” of this system, linking
the Roman Empire with the Han Empire since approximately
the second century BCE, and passing through almost all the
regions of the Afro-Eurasian world-system. Some prominent
scholars even believe that the establishment of trade ties
between China and Rome through the Silk Road about 2200
years ago gave birth to the Afro-Eurasian world-system.
 
The emergence of the global World-System dates
back to the “long sixteenth century”. It originated through a
series of expansion cycles of the initial World-System, which
grew to encompass a growing number of societies. The Age of
Discovery played a central role in establishing stable and
intense connections among regions which were then home to
the majority of the world’s population. The discovery of rich
resources in the New World- especially silver- and their
transportation around the world through the network of both old
and new land and sea trade routes enhanced world trade and
the connectivity of global networks.
  
Further development and growth of the World-
System’s global connectivity is directly related to the
“modernization transition,” in other words the transition from
traditional to modern societies. The beginning of modernization
and the birth of modern societies are often associated with the
Industrial Revolution in Britain and its subsequent spread first
to Europe and the USA, then worldwide. The significance of
the Industrial Revolution of 1760-1840 have caused many
transitioning aspects of modernization, affecting all spheres of
human life, including science, agriculture, education,
demography, politics, transportation, finance or culture.
The varying pace and scope of modernization transition, the
uneven spread of its effects and new technologies in the
seventeenth and eighteenth century laid the foundations for
“Great Divergence” with the rapidly widening gap in
income per capita and living standards between developed
countries and the rest of the world in the nineteenth century.
It began as a widening gap between the affluent countries of
the North and increasingly backward south.
 
Globalization and the Italian Renaissance (14th-
17th century)
Italian city-states trading during the late Middle Ages set the
stage for the Renaissance by moving resources, culture and
knowledge from the East. While Northern Italy was not richer in
resources than many other parts of Europe, the level of
development, stimulated by trade, allowed it to
prosper. Florence, Venice and Genoa became one of the
wealthiest cities in Northern Italy and it became the center of
the financial industry with the gold florin became the main
currency. Luxury goods bought in the Levant, such as spices,
dyes, and silks, were imported to Italy and then resold
throughout Europe. The Italian trade routes that covered the
Mediterranean and beyond were also the major conduits of
culture and knowledge. The Crusades had built lasting trade
links to the Levant.
 
Globalization and the Islamic Culture (Umayyad Caliphate
661AD-1031)
Muslim merchants used several ingenious ways of travelling
through the hot, arid desert. Trade routes were fairly common
and an efficient way to reach the destinations. Important trade
routes were along the Southern Mediterranean coast
connecting Spain and Morocco with Egypt and Syria. One of
the greatest of the trade routes followed in northeastern Iran
from Baghdad to Nishapur and to Central Asia and China.
Another popular roads connected the Red Sea and the Sea
of Suez with the Nile System in the Mediterranean and formed
a southern road that led from Adulis in Ethiopia to Aydhab
and Quseir to Qus, north of Aswan. Although many major
trading routes were widespread internal trade networks. To
enhance trade by sea, Muslim merchants also managed to
create colonies along the Indian coast and into China and
even entered Korea and Japan.
 
Globalization and the Mongol Empire
Mongol Empire in its Pax Mongolica revived the Silk Road
trade (103 BCE- 221CE) between the East and the West,
which set the stage of the evolution of international trade to its
current form today. The “Silk Road” was referred by many
Chinese merchants and other traders along the Central Asian
continent as the “Road to Samarkand”. The widespread rule
of the Mongols over a large part of Eurasia meant that the local
regions were unified political system of administration but, it
allowed flourishing of local economies that meant increase in
production of goods resulted in a stable supply of products that
traders can trade with.
 
THE MODERN GLOBALIZATION
  Colonialism and Imperialism (1450-1950)
When Spain and Portugal partitioned the world by signing the
Treaty of Tordesillas on June 7, 1494, they declared a
genuine European claim to hegemony. Conquest followed
discovery: Christopher Columbus (1451-1506) landed in
1492 on a West Indian island called San Salvador to
emphasize the religious character of taking possession.
The impetus for colonialism was often derived as an
answer to European history itself. This includes capitalist
striving for profit, the colonies as valves for
overpopulation, the spirit of exploration, scientific interest,
and religious and ideological impulses up to social-
Darwinstic and racist motives.
 
 Age of Mercantilism (16th-18th century)
Mercantilism is an economic theory that
advocates government regulation of international trade to
generate wealth and strengthen national power. Merchants
and the government with the grant of monopoly power over
importing and exporting companies work together to reduce
the trade deficit and create a surplus. It is a form of economic
nationalism that funds corporate, military and national growth.
It also advocated trade policies that protect domestic
industries through high tariffs on imported manufactured
goods, forbidding colonies to trade with other nations,
monopolizing markets with staple ports, banning the
export of gold and silver, even for payments, forbidding
trade to be carried in foreign ships, promoting
manufacturing and industry through research and direct
subsidies, limiting wages, maximizing the use of domestic
resources and restricting domestic consumption through
non-tariff barriers to trade.
 
 Age of Liberalism (19th Century)
  Economic liberalism is based on the principles of personal
liberty, private property, and limited government interference. It
is synonymous with Laissez Faire economics “Let them
do or Leave the Market alone”. Liberals believed that the free
market would naturally produce the best and most efficient
solutions to economic and social problems. It is a political and
economic philosophy based on strong support for a market
economy and private property in the means of productions. It
also opposes any government intervention in the free
market when it inhibits free trade and open competition.
As an economic system, economic liberalism is organized on
individual lines, meaning that the greatest possible number
of economic decisions are made by individuals or
households rather than by collective institutions or
organizations. Its major advocacy is free market in an open
competition and right to own property in pursuit of happiness.
 
 Keynesian Economics (1951-1973)
Keynesian economics is an economic theory of total
spending in the economy and its effects on output and
inflation. This was advocated by the British economist John
Maynard Keynes during the 1930s in an attempt to
understand the Great Depression. Keynes advocated
for increased government budget spending and lower
taxes to stimulate demand and pull the global economy out
of depression.
 
 Decolonisation
Decolonization of 1946-1970 is the opposite of colonization
and mercantilism. It is a revolt for national liberation of
colonial poor countries to undo and dismantle colonial
and mercantilism practices by earning their independence
and formation of self-governance by the indigenous people
from their European colonial masters as their fundamental right
to self-determination advocated by the United Nations. As
the sovereignty is transferred from the colonial master of
colonies to the indigenous people, and as they apprehended
how to manage their local economy for development, they
have learned the need and vital roles in the stability of the
economy, international trade, investments, communication and
technology, bank capital financing and tourism. This compelled
decolonized economies to rethink that independence is
more than acquiring sovereignty, but to manage the most
serious concerns of the economy - surplus and shortage,
which are to be resolved of a lively and active market and
marketing attaining the stability of market equilibrium of
QD=QS enabling both suppliers and consumers met their
cooperation, peace and mutual benefits. Any country that has
not taken care of their market and marketing both local
and international market and trade would be in detrimental
condition and that would be social unrest and civil wars.
 
 The Cold War (1947-1991)
The adoption of market and marketing did not come easy to
the newly independent decolonized poor countries. A number
of them became antagonistic against market economy,
some diverted for communism as their economic system and
even held a long time struggle against capitalism. Upon
the downfall of the Third Reich of NAZI Germany in 1945,
Europe and just like other region have been divided
geopolitically between the Soviet Russian communism and
the Pro-West USA capitalism sphere of political influences.
The Soviet Union had its formation in the Russian socialist
revolution of 1917, when the Radical leftist revolutionaries
overthrew Russia's Czar Nicholas II and its Romanov
dynasty’s regime, which was plagued by economic bankruptcy
due to the losses of World War I of 1914-1918. As a founding
father of communist Soviet Union became the patron and
supporter of the majority of the communist and socialist
revolutions to the various world’s regions until the Sino-Soviet
split of 1956. Though both China and Soviet were both
communist countries, their separation have turned the Cold
War period for the poor countries struggling for national
liberation for the formation of socialist and communist society
whether if they would be Pro-China or Pro-Soviet.
No matter the geopolitical bloc of the communist have
been divided between the Pro-China and Pro-Soviet, the Cold
War period that lasted for the period of 1947-1991 have
created an international relations between the Pro-USA
Western Bloc and the Eastern Bloc of Pro-Soviets and
China of geopolitical division and tensions characterized
for proxy wars which armed contentious groups in poor
countries that have different view of national liberation and
progress aligned themselves for economic and military
logistics assistance between Pro-Soviet-China or Pro-USA.
The Cold War Era between the Communist Soviet Union and
the USA is characterized for verbal threats of the doctrine of
Mutually Assured Destruction (MAD) with space race and
arms build-up with military hardware products
including Intercontinental Ballistic Missiles (ICBM) have
preventive preemptive direct armed attacks between the two
superpowers. In response to the Cold War, the USA in 1947
announced the Truman Doctrine where all communist
expansion shall be suppressed and contained by the USA to
preserve world peace and the global economy. The
international relations between the Pro-USA and the Pro-Soviet
and China Bloc have a created a global world of “Bipolarity”,
that have made the countries of the world speculated
whether the globalization of the economy would become
communism patterned to the Soviet-China model or a
Liberal Market Economy patterned to the model of USA
and its Western European allies.
Lesson 2: Globalization: Its Meaning and Historical
Process | Part 2
What is the difference between Liberal Market Economy
versus Communism?
     
                  The liberal market economy is also referred to as
“Capitalism or Western economy”. The term “West” refers to
countries of Western Europe and its Championing ally which is
the United States of America. The word liberal originated from
the Latin word “liber” meaning “free”. The term “free” if you will
understand from the perspective of the Industrial Revolution
of England 1760-1840 would mean freedom of enterprises,
property, education and competition while the French
Revolution of 1789-1799 advocated for the freedom as the
basic human rights constituting of the right to life, liberty,
property and pursuit of happiness. By combining the two
perspectives, it will give us a notion that the Liberal market
economy is an economic system where market decision-
making such as what to produce, how to produce, how
much to produce, for whom to produce and how the
system should be adjusted to change are made with the
democratic participation of the suppliers and demanders
with their private enterprises and consumption as long as
they will observe and abide to the rule of the law. What
would be the role of the government with the private initiatives
of suppliers and demanders? This is question is addressed by
term coined by liberal economies called as “Laissez-Faire”,
which means “Leave things alone” and the word “alone”
refers to the “marketplace” conducting their private
transactions of demand and supply as long as the laws of the
government are observed and respected as institution of fair,
justice and peace. Hence, under the liberal market system the
role of the government is maintained as minimal intervention
to let people widen the level of freedom that would
improve cultural diversities as more products and ideas are
exchanged in the marketplace. In this way, the market
economy with minimal government intervention but for peace,
order and morality would be what is called an “invisible hand”.
Unlike communism which is in a diseconomies of scale due
to overregulation, the market economy is
fostering economies of scale with its decentralized
decision-making to lawful pursuits of private individuals and
businesses cooperating in the marketplace. The liberal
economy is also attune to Henry David Thoreau quote “That
government is best which governs least”.
 
                 Communism plays exactly the
opposite role against Liberal Market Economy. Communism is
also referred to as the Centrally Planned Economy,
Command Economy or Democratic Centralism. As
advocated by Karl Marx the father of communism, the State,
family and private property must wither to attain social
equality. To do this, workers which Marx referred to as
Proletariats must take over the means and modes of
production by themselves by overthrowing in an armed
revolution the government and make their cooperative society
of workers as the government itself guided by their political
party called “the communist party”. Therefore, under
communism, all private enterprises and markets are
abolished and put into government control dominated by
the working class with their communist party that
performs the “rationing” of the produce generated by each
cooperative society known as “commune” for their own
consumption. Unlike in market liberal economy where the
production and consumption are determined by the private
markets, communism as a command economy answers all
the fundamental economic questions of what to produce,
how to produce, how much to produce and for whom to
produce by the government alone dominated by the working
class with their communist party as vanguard of communism.
In the middle of the 1980s, this economic system has proven
ineffective simply because the government can stand alone to
answer all the needs of the people. It has to deregulate itself
with private enterprises creation so that it would be freed of too
much burden of over concern for everything from the
smallest private need of individuals to the largest target
economic production. This has given birth to the period of the
“Post-Cold War Era”.
 
       The Post-Cold Era
                 The Post-Cold War Era is the period that has ended
the Cold war (1947-1991) of the Communist Soviet Union and
the Pro-West USA Market Capitalism economy whereby in
1989 the Berlin Wall in Germany, a concrete wall
barrier symbolically an international relation division between
the Pro Soviet Communist Bloc composing
of WARSAW Military alliance members with the Eastern
Europeans and the Chinese Communist against
the NATO Military alliances mostly Western Europe and its
capital-market economy allies. In 1989 and up to 1992, the
Berlin Wall collapsed when the East Germans on masse have
demolished part of the wall, declared it as open and crossed to
West Germany marking the Unification of Germany in
1990 amid of the fear that German NAZI Third Reich will
make a comeback. The collapse of communism that started in
Berlin, East Germany brought a chain reaction of downfall of
communism across Eastern Europe and the rest of
communist overseas like Vietnam, Cuba, Cambodia and
even China have been compelled to resort to Market
Liberal Economy to rescue and recover their failed
economies. This major trend in international relations has
created a concrete hope and positive response for the
globalization economies in which the embrace of market
liberal economy is a prerequisite for active participation in
the global economy. Notwithstanding the remaining
opposition and threat of the Islamic countries and North
Korea as the remaining communist country hostile to the Pro-
USA and its advocacy of market liberal economy, globalization
under the Free Liberal Market Economy still triumphs
throughout the global economy. It shows that no country
could ever deny nor prevent “market, marketing or trade” as
institutions and mechanisms inherent to all nations of the world
as the culture of “freedom”.  bias. It must be highlighted that one of the six core claims of
 
       Age of Neoliberalism (20th Century)
             Neo-liberalism is the 20th century resurgence of 19th-
century ideas associated with laissez-faire economic
liberalism and free market capitalism. It is an advocacy
to shift away from post-war Keynesian economics.
            Neoliberalism is characterized for its belief in the
sustained economic growth through the free markets, free
trade, banks and foreign direct investments as the most
efficient allocation of resources, its emphasis on minimal
government intervention in economic and social affairs.
Liberalism is often associated with the economist Adam
Smith, who argued in the Wealth of Nations (1776) that
markets are governed by an “invisible hand” and thus should
be subject to minimal interference.
Lesson 3: Theories of Globalization
1. World Systems Theory
The World Systems theory, developed by
sociologist Immanuel Wallerstein, is an approach to world
history and social change that suggests a world economic
system in which some countries benefit while others are
exploited. This theory emphasizes the social structure of global
inequality.
 However, this theory is criticized for focusing on the
economies and more attention to core countries. It is also
criticized for forgetting about the culture or class struggle of
lower countries.
This theory divides the world into three regions:
 Core countries (e.g., the United States and Western
Europe)
These are countries with a strong central government and
enough tax to support it. They are economically diversified,
industrialized, and independent of external control. They have
healthy middle and working class that focuses on a higher
scope of production of material goods than raw materials.
 Periphery countries
They are composed of countries in Latin America and Africa.
These countries generally have a weak government and are
focused on extracting raw materials and not final goods. They
also tend to have a higher percentage of poor and uneducated
people and a small population that controls the economy.
 Semi-periphery countries
These countries make up the middle ground between core and
periphery countries. They are not dominant in international
trade, but they have a diversified and growing economy.
 
2. Modernization Theory
The modernization theory proposes that all countries follow a
similar development path: that is, from a traditional to modern
society. It assumes that traditional countries can develop into
modern countries with some help in the same way modern
countries did. It looks at the internal social dynamics as the
traditional nation is exposed to new technologies and political
and social changes.
This theory emphasizes the benefits of free trade, foreign
investment, and foreign aid. It argues that free trade and
international market relations occur in a framework of uneven
relations between developed and underdeveloped countries
and work to reinforce and reproduce these relations.
Modernization theory comes out of the structural-functional
viewpoint. It frames inequality as a function of industrial and
cultural differences between nations. However, one flaw in this
theory is its willingness to recognize its inherent Eurocentric
globalization is that “Nobody is in charge of globalization” and
this theory tends to counter this claim.
 
3. Dependence Theory
This theory, a reaction to modernization theory, uses core and
periphery countries from the World Systems theory to look at
inequality between nations.
This theory espouses the idea that Periphery countries export
resources to the wealthy Core (First World) not because they
are in an earlier development stage but because they are
integrated into the World-system as an undeveloped country.
They have structures and features not seen in developed
nations and will not become a developed nation. They are in an
unfavorable economic position, which means they do not have
the opportunity to improve and develop. They will remain as
third world countries dependent on wealthier nations.
Lesson 4: Advantages and Disadvantages of Globalization
Lesson 5: Glocalization
Glocalization is a portmanteau of global and local. As
peers of states in the world system universalize business
conduct, their products are made and adjusted according to the
taste of the local niche of the market. Westernization and
Mcdonaldization are the two terms often equated with
globalization.
In the 1990s, McDonald's opened its first branch in India.
However, the problem is that while McDonald's is a global
brand, its all-beef patties are not suited for Indian customers
who do not eat cow meat. McDonald's had to glocalize its
approach and incorporate the culture of India into its menu.
The Maharaja Mac was born, and through the years, this has
been an approach that they use for their international chains.
Glocalization means to think global, but act local. This
means that a product or service that is usually distributed
globally is adjusted to fit the needs of the local market.
Glocalization offers strategic opportunities for both businesses
and countries to perceive both the advantages and
disadvantages of globalization as business and social
opportunities. Culture and product diversities are inevitable,
given the geographical regions of the countries are absolutely
differentiated.