Globalization

- process in which people, ideas and goods spread throughout the world, spurring
more interaction and integration between the world's cultures, governments and
economies
- a process of interaction and integration among the people, companies, and
governments of different nations, a process driven by international trade and
investment and aided by information technology. This process has effects on the
environment, on culture, on political systems, on economic development and prosperity,
and on human physical well-being in societies around the world
- process of integration of economies across the world through cross-border flow of
factors product and information (5). According to the International Monetary Fund
(IMF) globalization is the growing economic interdependence of countries worldwide
through increasing volume and variety of cross border transactions in goods and
services and of international capital flows and also through the more rapid and wide
diffusion of technology
- expansion, and intensification of social relations and consciousness across world time
and world space.
- It is about growing worldwide connectivity according to Steger.
- considered a multi-dimensional process involving economic, political, technological,
cultural, religious and ecological dimensions.
- It suggests a dynamic process of change that results in either positive or negative
development. It leads to the creation of something new; it involves the multiplication of
social connections and various activities that transgress traditional and political,
economic, cultural and geographical lines.

PUBLIC ADMINISTRATION AND POLITICAL SCIENCE

- Public administration is a field in which leaders serve communities to advance the

common good and effect positive change. Public administration professionals are
equipped with skills to manage at all levels of government (local, state, and federal) as
well as non-profit organizations.
- Political science is the study of politics and power from domestic, international, and
comparative perspectives. It entails understanding political ideas, ideologies, institutions,
policies, processes, and behavior, as well as groups, classes, government, diplomacy,
law, strategy, and war.

The BRICS

- Brazil, Russia, India, China and South Africa (BRICS) is an acronym for the
combined economies of Brazil, Russia, India, China and South Africa. BRIC, without
South Africa, was originally coined in 2003 by Goldman Sachs, which speculates that by
2050 these four economies will be the most dominant. South Africa was added to the list
 on April 13, 2011 creating "BRICS". These five countries were among the fastest
growing emerging markets as of 2011.
- refer to the idea that China and India will, by 2050, become the world's dominant
suppliers of manufactured goods and services, respectively, while Brazil and Russia will
become similarly dominant as suppliers of raw materials. Due to lower labor and
production costs in these countries now including a fifth nation, South Africa, many
companies have also cited BRIC as a source of foreign expansion opportunity i.e.
promising economies in which to invest.

GLOBAL GOVERNANCE

- product of neo-liberal paradigm shifts in international political and economic relations. It

is a movement towards political integration of transnational actors aimed at negotiating
responses to problems that affect more than one state or region. It tends to involve
institutionalization.
- a tool to identify solutions to problems created by neo- liberal globalization. Its concept
relates to the interaction of myriad collective or individual entities emanating from various
societal and professional orientations which form networks that engage to address
issues that threaten local and global communities. It is concerned with issues that have
become too complex for a single state to address alone.
- sum of governance processes operating in the absence of world government.

DIMENSIONS OF GLOBALIZATION

1. Economic Dimension - an extensive development of economic relations across the

globe as a result of technology and the enormous flow of capital that has stimulated
trade in both sources and goods.
2. Political Dimension - an enlargement and strengthening of political interrelations
across the globe.
3. Cultural Dimension - the increase in the amount of cultural flows across the globe.
Cultural interconnections are at the foundations of contemporary globalization.
4. Religious Dimension
Religion is a personal or institutionalized set of attitudes, beliefs, and practices relating
to or manifesting faithful devotion to an acknowledged ultimate reality or deity. It is the
most important defining element of any civilization as contrasted with race, language, or
way of life. As such, it is also portrayed as a defining element in future conflicts. Whether
the root cause of a particular conflict or merely a vehicle for the mobilization of
nationalist or ethnic passions, religion is certainly central to much of the strife currently
taking place around the globe.
5. Ideological Dimensions
Ideology is a system of widely shared ideas, beliefs, norms and values among a group
of people. It is often used to legitimize certain political interests or to defend dominant
power structures. Ideology connects human actions with some generalized claims
 Globalization is a social process of intensifying global interdependence while globalism
is an ideology that gives the concept of neo-liberal values and meanings to globalization.

MAJOR IDEOLOGICAL CLAIMS OF ADVOCATES OF GLOBALISM

1. Globalization is about the liberalization and global integration of markets.

The problem with this claim is that liberalization and integration of markets happen
through political project of engineering free markets by interference of centralized state
power, and it is in contrast to the neoliberal ideal of limited role of governments.
2. Globalization is inevitable and irreversible.
Globalists believe that spread of market forces driven by technological innovations is
inevitable in globalization. Neoliberals use this claim to convince people to adopt the
natural discipline of the market if they want to prosper, which implies the elimination of
government controls over the market.
3. Nobody is in charge of globalization.
This claim seeks to depoliticize the public debate on globalization and neutralizing anti -
globalist movements.
4. Globalization benefits everyone.
Globalists talk about the benefits of market liberalization such as rising global living
standards, economic efficiency, individual freedom, and technological progress. But the
reality is that the opportunities of globalization are spread unequally and power and
wealth are concentrated among a specific group of people, regions and corporations.
5. Globalization furthers the spread of democracy in the world.
For the globalists democracy and free markets are synonymous.

CHARACTERISTICS OF GLOBALIZATION

1. It involves both the creation of new social networks and the multiplication of existing
connections that cut across traditional, political, economic, cultural, and geographical
boundaries.
2. Globalization is reflected in the expansion and the stretching of social relations,
activities, and connections.
3. Globalization involves the intensification and acceleration of social exchanges and
activities.
4. Globalization processes do not occur merely or an objective, material level but they also
involve the subjective plane of human consciousness. Without erasing local and national
attachments, the compression of the world into a single place has increasingly made
global the frame of reference for human thought and action. Globalization involves both
the macro-structures of a global community and the micro-structures of global
personhood. It extends deep into the core of the self and its dispositions, facilitating the
creation of multiple individual and collective identities nurtured by the intensifying
relations between the personal and the global. They differ from each other by
acceleration in the speed of social exchanges and widening of geographical scopes.
CONCEPT OF SUSTAINABLE DEVELOPMENT

- New way of seeing things

- Thinking about the next generation
- Being mindful about the environment

SOCIAL STRETCHING

- Emergence of gigantic and virtually identical shopping malls in all continents to cater to
consumers who can afford commodities all over the world-including products whose
various components were manufactured in different countries.
- Covered in the process of social stretching are:
1. Non-governmental organization
2. Commercial enterprises
3. Social clubs
4. Regional & global institutions and associations (UN, EU, ASEAN, Google and
others)

SOURCES OF ECONOMIC GROWTH

1. Property rights
2. Regulatory institutions
3. Institutions for macro-economics
4. Stabilization
5. Institutions for social influence
6. Institutions for conflict management

PERIOD OF GLOBALIZATION

1. The Prehistoric Period (10000 BCE-3500 BCE) - In this earliest phase of globalization,
contacts among hunters and gatherers – who were spread around the world – were
geographically limited. In this period due to absence of advanced forms of technology,
globalization was severely limited.
2. The Pre-modern Period (3500 BCE- 1500 CE) - In this period the invention of writing and
the wheel were great social and technological boosts that moved globalization to a new
level. The invention of wheel in addition to roads made the transportation of people and
goods more efficient. On the other hand writing facilitated the spread of ideas and
inventions.
3. The Early Modern Period (1500-1750) - It is the period between the Enlightenment and
the Renaissance. In this period, European Enlightenment project tried to achieve a
universal form of morality and law. This with the emergence of European metropolitan
centers and unlimited material accumulation which led to the capitalist world system
helped to strengthen globalization.
 4. The Modern Period (1750-1970) - Innovations in transportation and communication
technology, population explosion, and increase in migration led to more cultural
exchanges and transformation in traditional social patterns. Process of industrialization
also accelerated.
5. The Contemporary Period (from 1970 to present) - The creation, expansion, and
acceleration of worldwide interdependencies occurred in a dramatic way and it was a
kind of leap in the history of globalization.

- CULTURAL ASPECT OF GLOBALIZATION

- JOB OR WORK AS PROPERTY

ETHICS

- The philosophy of good behavior

ASPECTS OF CULTURE

- The major elements of culture are symbols, language, norms, values, and artifacts.
Language makes effective social interaction possible and influences how people
conceive of concepts and objects. Major values that distinguish the United States
include individualism, competition, and a commitment to the work ethic.

TRADE BARRIERS

- These are measures that governments or public authorities introduce to make imported
goods or services less competitive than locally produced goods and services. They are
state-imposed restrictions on trading a particular product or with a specific nation. It can
be linked to the product, service like technical requirement and it can also be
administrative in nature such as rules and procedures of transactions. Tariffs, duties,
subsidies, embargoes and quotas are the most common trade barriers.

DRIVERS OF GLOBALIZATION

- One principal driver of globalization is technology. Economic life is dramatically

transformed by advancement in information technology. All sorts of individual economic
actors like consumers, investors, and businesses which are valuable new tools for
identifying and pursuing economic opportunities, including faster and more informed
analyses of economic trends around the world, easy transfers of assets, and
collaboration with far-flung partners are provided by information technologies.

GLOBAL/MULTINATIONAL COMPANY

- A global corporation is a business that operates in two or more countries. It also goes
by the name "multinational company". Several advantages are offered by global
 expansion of business over running a strictly domestic company. Success in different
types of economies is achieved by means of multiple countries' operation while it causes
also logistic and cultural challenges. Expanding revenue opportunities and diversifying
business risk are the purposes of becoming a global corporation. Access to more
customers and capital is obtained through a model that works domestically well and
translates foreign markets well.

CONCEPT OF THE GLOBAL DIVIDES

- Global South refers to the regions of Latin America, Asia, Africa, and Oceania mostly
low- income and often politically or culturally marginalized. It may also be called the
"developing World" such as Africa, Latin America, and the developing countries in Asia,
"developing countries," "less developed countries," and "less developed regions”
including poorer "southern" regions of wealthy "northern" countries.
- Global South refers to these countries' "interconnected histories of colonialism, neo-
imperialism, and differential economic and social change through which large
inequalities in living standards, life expectancy, and access to resources are maintained.
Contemporary critics of neo-liberal globalization use the global south as a banner to rally
countries victimized by the violent economic cures of institutions like the International
Monetary Fund.
- "Third World" is a phrase frequently used to describe a developing nation.
- Third World countries are largely characterized as poor and underdeveloped.
- Regionalism refers to the decentralization of political powers or competencies from a
higher towards a lower political level.

CULTURAL DIVERSITY

- Cultural diversity often results hybridization - a constructive interaction process

between global and local characteristics which is often visible in food, music, dance, film,
fashion, and language. As a result there is a scarcely any society in the world that
expresses itself in its own self-contained and authentic culture

JIHADIST GLOBALISM

- religious response to the materialist assault by the ungodly West in the rest of the world.
Coming out of what they consider a pure form of Islam, its disciples seek to destroy all
those alien influences that have been imposed on Muslim people. It applies to those
extremely violent strains of religion that convert the global imaginary into very concrete
political agendas and terrorist tactics. It is also applied to those violent fundamentalists in
the West who seek to transform the world into a Christian Empire.

ROMAN CATHOLIC TEACHINGS ON Globalization

There are eight (8) principles that summarize the Roman Catholic Teachings
 1. Commitment to universal human rights.
2. Commitment to the social nature of the human person
3. Commitment to the common good
4. Solidarity (The principle of Solidarity affirms that membership in the human family
means that all bear responsibility for one another.)
5. Preferential option of the poor (In the Theology of the Incarnation- Christ God became
poor for us so as to enrich us by his poverty. The poor are susceptible to the effects of
environmental irresponsibility because they live in countries where cheap building
materials and cheap labor are readily available. They regularly work in farming, fishing,
and forestry, areas which suffer environmental damage). 6.
6. Subsidiary (The Catholic Church teaches that decisions should be made at the lowest
level in order to achieve the common good.
7. Justice
8. Integral Humanism- is concerned with whole person

DIFFERENT KINDS OF JUSTICE

1. Commutative justice - This aims at fulfilling the terms of contracts and other promises
on both personal and social level.
2. Distributive justice - This ensures a basic equity in how both the burden and the goods
of society are distributed and that ensures that every person enjoys a basically equal
moral and legal standing apart from differences in wealth, privilege, talent and
achievements
3. Social justice - This refers to the creation of the conditions in which the first two
categories of justice can be realized and the common good identified and defended.

According to catholic teaching, a just society is one which these forms of justice
are assured because they are required by human dignity.

PHILOSOPHERS

- Who said that if a government is without justice-it can only be considered a band of
robbers? St. Augustine

DIFFERENCE BETWEEN GLOBALISM AND GLOBALIZATION

- The neoliberal explanation of globalization is ideological because it is politically

motivated and contributes to the construction of particular meanings of globalization
which stabilize existing power relations.
- Globalism tries to create collective meaning and shape people’s identities.

DIFFERENCE BETWEEN DEVELOPED AND DEVELOPING COUNTRIES

 - In most developed countries where open market economy prevails, the international
economic organizations support free trade policies.
- In the case of developing nations partially-shielded trade practices are preferred to
protect their local trade industries.

TWO MAJOR DRIVING FORCES FOR ECONOMIC GLOBALIZATION

- The rapid growing of information in all types of productive activities

MARKETIZATION

- A restructuring process that enables state enterprises to operate as market-oriented

firms by changing the legal environment in which they operate and can be achieved
through reduction of state subsidies, organizational restructuring of management such
as corporatization, decentralization, and privatization
- Privatization
- Reduction of global subsidies
- Corporatization
- Decentralization

INTERNATIONAL TRADE

- is the exchange of goods, services and capital across national borders. It is a multi-
million dollar activity, central to the Gross Domestic Product (GDP) of many countries,
and it is the only way for many people in many countries to acquire resources. In
acquiring products where demand is inelastic and domestic supply is inadequate absent
traders, consumers and suppliers are forced to either develop substitute goods or devote
a large percentage of their income.

TRADE POLICIES

- the regulations and agreement of foreign countries. It defines standards, goals, rules,
and regulations that pertain to trade relation between countries. Each country has
specific policies formulated by its officials. Boosting the nation’s international trade is the
aim of each country. Taxes imposes on import and export, inspection, regulations, tariffs
and quotas are all part of country’s trade policy.

Focuses of Trade Policy in International Trade

(1) Tariffs - These are taxes or duties paid for a particular class of imports or exports.
Imposing taxes on imported and exported goods is a right of every country. Heavy tariffs
on imported goods are levied by some nations for the protection of their local industries.
The prices of imported goods in local markets are inflated due to high imported taxes to
ensure demand of local products.
 (2) Trade barriers - Theses are measures that governments or public authorities introduce
to make imported goods or services less competitive than locally produced goods and
services. They are state-imposed restrictions on trading a particular product or with a
specific nation. It can be linked to the product, service like technical requirement and it
can also be administrative in nature such as rules and procedures of transactions.
Tariffs, duties, subsidies, embargoes and quotas are the most common trade barriers.
(3) Safety - This ensures that imported products in the country are of high quality.
Inspection regulations laid down by public officials ensure the safety and quality
standards of imported products.

BRETTON WOOD SYSTEM

- In 1944, 730 representatives of 44 nations met at Bretton Woods, New Hampshire,

United States to create a new international monetary system called the Bretton
Woods system, the aim of which is to create a stabilized international currency system
and ensure monetary stability for all the nations.

EUROPEAN UNION

- An international organization comprising 28 European countries and governing common

economic, social, and security policies. In the early 21st century EU expanded into
central and eastern Europe with the following members: Austria, Belgium, Bulgaria,
Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United
Kingdom.

TYPES OF TRADE POLICIES

(1) NATIONAL TRADE POLICIES - This safeguards the best interest of its trade and
citizens.
(2) Bilateral Trade Policy - To regulate the trade and business relations between two
nations, this policy is formed. Under the trade agreement the national trade policies of
both the nations and their negotiations are considered while bilateral trade policy is
being formulated.
(3) International Trade Policy - This defines the international trade policy under their
charter like the International economic organizations, such as Organization for Economic
Co- operation and Development (OECD), World Trade Organization (WTO) and
International Monetary Fund (IMF).The best interests of both developed and developing
nations are upheld by the policies.

MARKET INTEGRATION
 - refers to how easily two or more markets can trade with each other. It occurs when
prices among different locations or related goods follow similar patterns over a long
period of time. Groups of prices often move proportionally to each other and when this
relation is very clear among different markets it is said that the markets are integrated.
- used in identifying related phenomenon of market of goods and services experiencing
similar patterns of increase or decrease in prices of products. It may also refer to the
movement of prices of related goods and services sold in a defined geographical
location in similar patterns.
- exists when there are exerted effects that prompt similar changes or shifts in other
markets that focus on related goods on events occurring within two or more markets.

Types of Related Markets where Market Integration Occurs

(1) Stock Market Integration - This is a condition in which stock markets in different
countries trend together and depict same expected risk adjusted returns. Two markets
are perfectly integrated if investors can pass from one market to another without paying
any extra costs and if there are possibilities of arbitration which ensures the equivalence
of stock prices on both markets.
(2) Financial Market Integration - It is an open market economy between countries
facilitated by a common currency and the elimination of technical, regulatory and tax
differences to encourage free flow of capital and investment across border. It occurs
when lending rates in several different markets begin to move in tandem with one
another. Emergence of similar patterns within the capital, stock, and financial markets
with those trends coming together to exert a profound influence on the economy of that
nation is involved in the integration within a nation.

IMF WTO

- The IMF and the WTO are international organizations with about 150 members in
common.
- The IMF's central focus is on the international monetary and financial system.
- WTO's is on the international trading system, both work together to ensure a sound
system for global trade and payments.
- The World Trade Organization (WTO) - deals with the global rules of trade between
nations with the main function of ensuring that trade flows smoothly, predictably and
freely. It is the only global international organization dealing with the rules of trade
between nations with WTO agreements, negotiated and signed by the bulk of the world’s
trading nations and ratified in their parliaments at its heart. WTO is viewed as the means
by which industrialized countries can gain access to the markets of developing countries.

NEOLIBERALISM

- the intensification of the influence and dominance of capital. It is the elevation of

capitalism as a mode of production into an ethic, a set of political imperatives, and a
 cultural logic. It is a project to strengthen, restore, or, in some cases, constitute anew the
power of economic elites. It values market exchange as an ethic in itself capable of
acting as a guide to all human action and substituting for all previous held ethical beliefs.
It emphasizes the significance of contractual relations in the marketplace. It also holds
that the social good will be maximized by maximizing the reach and frequency market
transactions, and it seeks to bring all human action into domain of the market.

PRESIDENT NIXON AND HIS ACT OF REMOVING DOLLAR FROM THE JURISDICTION
UNDER BRETTON WOOD SYSTEM

- Since the United States held most of the world’s gold, all the nations would determine
the values of their currencies in terms of dollar. The central banks of nations were given
the task of maintaining fixed exchange rates with respect to dollar for each currency. The
Bretton Woods system ended in 1971 as the trade deficit and growing inflation
undermined the value of dollar in the whole world. In 1973, the floating exchange rate
system, also known as flexible exchange rate system was developed that was market
based.

FOREIGN DIRECT INVESTMENT

- was of corporate origin. It is a major driver of extended global corporate development. It

is an investment made by a company or individual in one country in business interests in
another country, in the form of either establishing business operations or acquiring
business assets in the other country, such as ownership or controlling interest in a
foreign company and the key feature of foreign direct investment is that it is an
investment made that establishes either effective control of, or at least substantial
influence over, the decision making of a foreign business.
- Foreign direct investment is made open to economies; frequently involves more than just
a capital investment and includes provision of management or technology as well. There
are many methods to establish FDIs such as opening a subsidiary or associate company
in a foreign country; acquiring a controlling interest in an existing foreign company, or by
means of a merger or joint venture with a foreign company.

ROLE OF CFO IN A BUSINESS ORGANIZATION

- must balance the opportunities with the challenges of operating in multiple environments
in managing their internal markets in building an advantage.
- These three functions can be created by CFOs through exploiting their internal capital
markets.
1. Financing - A group’s tax bill can be reduced by the CFO like borrowing in countries
with high tax rates and lending to operations in countries with lower rates. 2.
2. Risk Management - Global firms can offset natural currency exposures through
worldwide operations instead of managing currency exposures through financial
markets.
 3. Capital budgeting - Getting smarter on valuing investment opportunities CFOs can add
value.

PERSON WHO COINED THE TERM BRICS

- originally coined in 2003 by Goldman Sachs

THOMAS FRIEDMAN

- The belief that globalization imposes a forced choice upon states either to conform to
free market principles or run the risk of being left behind is termed into a phrase called
“Golden Straitjacket” by Thomas Friedman, a neoliberalism journalist and
advocate, to illustrate the forcing of states into policies that suit the preferences of
investment houses and corporate executives (Electronic Herd) who swiftly move money
and resources into countries favored as adaptable to the demands of international
business and withdraw even more rapidly from countries deemed uncompetitive.

MANILA-ACAPULCO galleon trade

- The term Manila galleon can also refer to the trade route itself between Acapulco and
Manila, which lasted from 1565 to 1815. The Manila galleons sailed the Pacific for 250
years, bringing to the Americas cargoes of luxury goods such as spices and porcelain in
exchange for New World silver

THE EURO

- The European Monetary System (EMS) on the other hand is a 1979 arrangement
between several European countries which links their currencies in an attempt to
stabilize the exchange rate. This system was succeeded by the European Economic and
Monetary Union (EMU), an institution of the European Union (EU), which established a
common currency called the euro.

4 ELEMENTS OF STATE

1. Territory
2. People
3. Sovereign Power

NATION

- state role in globalization is complex. Since nation-states are divided by physical and
economic boundaries, reduced barriers in international commerce and communication
are considered their potential threat. Sovereignty of individual nations is not abolished by
 expanded trade among countries, instead globalization is a force that changed the way
nation-states deal with one another, particularly in the area of international commerce.

GLOBALIZATION’S IMPACT ON THE STATE:

Factors which lead to the increase and acceleration of movement of people,

information, commodities and capital.

(1) Lifting of trade barriers

(2) Liberalization of world capital markets
(3) Swift technological progress (information technology, transportation and communication)

Problems afflicting the world today which are increasingly transnational in nature-
those that cannot be solved at the national level or State to State negotiations.

(1) Poverty
(2) Environmental pollution
(3) Economic crisis
(4) Organized crime and terrorism

Effects of greater economic and social interdependence to national decision- making

processes.

(1) It calls for a transfer of decisions to the international level

(2) It requires many decisions to be transferred to local levels of government due to an
increase in the demand for participation.

The following can be guaranteed only by the States through independent courts:

(1) Respect of human rights and justice

(2) Promote the national welfare
(3) Protect the general interest

ECONOMIC SOVEREIGNTY

- the power or national governments to make decisions independently of those made by

other governments.

There are four different concepts of sovereignty. These include:

(1) International Legal Sovereignty - It refers to the acceptance of a given state as a

member of the international community.
(2) Westphalian Sovereignty - It is based on the principle that one sovereign state should
not interfere in the domestic arrangements of another.
 (3) Interdependence Sovereignty - It is the capacity and willingness to control flows of
people, goods and capital into and out of the country.
(4) Domestic Sovereignty - It is the capacity of a state to choose and implement policies
within the territory.

EUROPEAN INTEGRATION

- is the process of industrial, political, legal, economic, social and cultural integration of
states wholly or partially in Europe. European integration has primarily come about
through the European Union and its policies.

SOCIAL MEDIA

- is a computer-based technology that facilitates the sharing of ideas and information and
the building of virtual networks and communities. By design, social media is internet
based and offers users easy electronic communication of personal information and other
content, such as videos and photos. Users engage with social media via computer,
tablet or smartphone via web-based software or web application, often utilizing it for
messaging. It “empowers” individuals to have a voice.