Chapter 3: The World of Interdependence
economic system
Global Interdependence
▪ Refers to mutual dependence between countries on
a global scale.
▪ As a result, economic, political, and environmental
issues often bring nations closer together
Examples:
➢ When Saddam Hussein of Iraq invaded Kuwait
because he wanted to gain control of its huge oil
reserves. Because of this, in 1991, 39 UN nations
formed a coalition against Iraq and beat Iraq in the 1st
Gulf War.
➢ The depletion of the ozone layer that lead to various
natural disasters that do not choose whether the
country is developed or developing.
➢ Terrorist attacks that destroy lives including innocent
children leading countries of different economic
standing to unite and fight terrorist by tightening their
security measures.
Commodity Chains
▪ A network of labor and production processes whose
end result is a finished commodity
▪ Focuses on the international trading system and the
increasing economic integration of international
production
▪ Dependency Theory
▪ emphasized the existence of the core and peripheral
countries
▪ A historical condition which shapes a certain structure
of the world economy such as it favors some
countries to the disadvantage of others
1. Core or dominant states – advanced
industrial nations
2. Periphery or dependent states – those
states in Latin America, Asia, Africa which
have low per capita Gross National Product
(GNP) and rely heavily on the export of a
single commodity for foreign exchange
earnings.
▪ World Systems Theory
▪ added the semi- periphery in the core and periphery
analysis of the dependency theory
1. Semi-periphery states – refer to areas
represented either by the core regions in
decline or in peripheries attempting to
improve their relative position in the
Commodity chain can be:
▪ Producer-driven – capital and technology intensive
driven market where multinational corporations
invest directly to the core country.
Ex: Toyota General Motors
▪ Buyer-driven – labor intensive and low technology
market where the core corporations own trademarks
and engage in sub-contracting to smaller companies
mostly located in the periphery.
Ex: Gap, Levi’s
INTERNATIONAL ORGANIZATION AND TRANSNATIONAL
CORPORATION
The disparity on the pace of development among the
developed and developing countries, the World Bank and
International Monetary Fund provide loans to the developing
countries to the extent that developing countries became
highly indebted.
o World Bank – established to help restoration of
economies disrupted by war by facilitating the
investment of capital for productive purposes
o IMF (International Monetary Fund)– a supervisory
institution for coordinating the efforts of member
countries to achieve greater cooperation in the
formulation of economic policies. It helps promote
exchange stability and orderly exchange relations
among its member countries.
o Foreign Direct Investment (FDI) – foreign capital from
private companies
o Transnational corporations – private companies that
invest in developing countries; they invest in
developing countries but they are still the sole owners
of these investments
Chapter 4: Contemporary Society and
Environment
Najam, Runnalls and Hale (2007) provided a classification of at
least five broad sets of definition of Globalization:
1. Globalization as Internationalization
- Used to describe cross-border relations between
countries as well as the growth international
exchange and interdependence
2. Globalization as Liberalization
- Removal of government-imposed restrictions on
movement between countries
3. Globalization as Universalization
 - Process of spreading ideas and experiences
worldwide so that aspirations and experiences
become harmonized
4. Globalization as Westernization or Modernization
- Deals with social structures of modernity such as
capitalism, industrialism, etc and their effects to
cultures and local self-determination
5. Globalization as Deterritorialization
- Process of reconfiguration of geography, so that
social space is no longer limited in terms of
territorial places, distances, and borders
▪ The present society is more concerned with uplifting
the status of its constituents by improving their
income and livelihood and employment.
▪ More people are becoming aware and vigilant to
avoid further destruction and to preserve nature’s
beauty and wonders
THE ENVIRONMENT AND GLOBALIZATION
Environmentalists and other concerned individuals are
alarmed of the effects of globalization on the environment.
The effort to improve a nation’s economy also lies in the
responsibility to take care of the environment.
The five propositions were conceptualized to explain the
present status of the global environment.
The domino effect of the increase of income and the rise of
Gross Domestic Product (GDP) is the rise of environmental
problems.
Five Propositions:
Proposition 1
- The rapid acceleration in global economic activity and
our dramatically increased demands for critical, finite
natural resources undermine our pursuit of continued
economic prosperity.
Proposition 2
- The linked processes of globalization and
environmental degradation pose new security threats
to an already insecure world.
Proposition 3
- The newly prosperous and established wealthy will
have to come to terms with the limitations of the
ecological space in which both must operate, and also
with the needs and rights of those who have not been
as lucky.
Proposition 4
- Consumption in both North and South will define the
future of globalization as well as the global
environment
Proposition 5
- Concerns about the global market and the global
environment will become even more intertwined and
each will become increasingly dependent on the
other
GLOBALIZATION: EFFECTS ON BIODIVERSITY, ENVIRONMENT,
AND SOCIETY
➢ The effect of globalization is mostly present in urban
areas. The reduction of genetic diversity in agriculture
particularly on vegetables, food, plants, grains, and
tree crops are well-documented.
➢ However, losses on non-commercial varieties
cultivated by individual farmers are expected in the
Third World countries.
➢ The environmental cost of globalization is evident in
the environment. Soil, air, and water pollution caused
by pesticides and fertilizers are threats to the health
of the people.
THE ENVIRONMENT AND ECONOMIC GLOBALIZATION
Globalization is blamed as the primary reason for the
destruction of the environment.
Three means for environmental improvement according to
international macroeconomist Jeffrey Frankel (2003):
✓ Consumer Power
- Exercise of environmentally conscious
consumers to use their purchasing power in the
market by expressing their wishes and demands
✓ Multilateral rules
- Policies and guidelines set by environmentalists
to preserve the environment
✓ Statistical evidence
- The quantitative and tangible results of
environmental effects and solutions as a
consequence of environmental expression
POSSIBLE SOLUTIONS TO ENVIRONMENTAL DEGRADATIONS

1. On the problem of depletion, industries should find

ways to recycle the resources they have already used
or use different resources as a replacement of the
current resources being used.
2. On pollution, strong political will would be needed to
continue the creation and enforcement of
antipollution laws.
3. On waste management, business industry and
government sectors should find ways in which
business and industry can reuse their waste products.
4. Lester Brown (2009) in his book Plan B 4.0: Mobilizing
to Save Civilization wrote: “We know what we need
to do... The challenge is how to do it in the time
available.”