TCC 213 International Production and Networks

 These involve the networks of producers involved in the process of producing a

LESSON 1 finished product.
Global Commodity Chains
What is Globalization?  Gereffi and Korzeniwics (1994) bring together the idea of value-adding chains
 refers to flows of people in a particular aspects or reasons. and the global organization of industries.
Value Chains
4 TYPES OF GLOBALIZATION  is a series of activities or processes that aims at creating and adding value to an
article at every step during the production process.
1. Economic Globalization Global Value Chains
2. Social Globalization  Gereffi argues that global value chains are emerging as the overarching label for
3. Cultural Globalization all work in this area and for all such chains.
4. Political Globalization  Example
A smart phone assembled in China might
include graphic design elements from the
1. Economic Globalization United States, computer code from France,
 refers to the international movement of goods, capital, services, technology and silicone chips from Singapore, and precious
information, which main purpose is economic growth. metals from Bolivia. Throughout this process,
2. Social Globalization all countries involved retain some value and
 refers to the sharing of ideas and information between nation and other parts of benefit from the export of the final product.
the world. now adays, it is manifested with the help of internet or different social Increasing Competition for Commodities
media platforms.  One of the most striking developments in recent years has been the increasing
3. Cultural Globalization global competition for various commodities. Demand for commodities has
 it involves the spread of language, the arts, foods, business ideas, beliefs, religion, increased.
and practices around the world.
4. Political Globalization What is Commodity?
 focuses on the leaders of the nations have inter-grated their laws and built  is a basic good used in commerce that is interchangeable with other goods of
alliances for their mutual benefits. the same type. Commodities are most often used as inputs in the production of
other goods or services. The quality of a given commodity may differ slightly, but
LESSON 2 it is essentially uniform across producers.
Outsourcing
The Global Economy  is the transfer of activities once performed by an entity to a business or businesses
 The global economic system, beginning in 1896, had reached its peak in 1914. in exchange for money.
There are various changes and improvements that characterize economic Consumption
globalization before and at present. Structures of transportation, communication,  is highly complex, involving mainly consumer objects, consumes, the consumption
and capital are comparable then and now. process and consumption sites.

Changes & improvements in economic structure Consumer Objects and Services

 Surpluses and Deficits  Much of consumption revolves around shopping for and purchasing objects of
 Economic Chains and Networks all kinds (Quarter Pounder, snowboards, and automobiles, among to various
 Supply Chains service (legal, accounting, and educational, among others).
 International Production Networks Consumption Processes
Surpluses and Deficits  Includes knowing how to work their way through a shopping mall, use a credit
 A good place to get a quick snapshot of global trade (Mann and Pluck, card, or make purchase online.
2007:1159-66), as well as net economic flows in and out of nation-state, is by
looking at a nation’s trade surpluses and deficits. Worldwide Division of Labor and the Development of the Modern World System
Economic Chain and Networks  Not all countries or areas are equal in the modern world-system according to
 Trade in goods and services is clearly central to the global economy. Wallerstein. A three-level hierarchy is a remarkable feature of the modern
 The modern technology strengthen these economic chain, makes transportation capitalist world-economy.
more faster and efficient.
Supply Chains
 A supply chain begins with raw materials and follows the value-adding process
through variety of inputs and outputs and ultimately to a finished product.

3 categories in worldwide division of labor
a) Core
 These are areas that dominate the capitalist
world-economy and exploits the rest of the
system (e.g., US and Japan)
b) Periphery
 These are areas that provide raw materials to the
core and are heavily exploited (e.g., many
countries in the African region)
c) Semi-periphery
 A residual category that encompasses a set of
regions somewhere between exploiting and the
exploited (e.g., India)
LESSON 3
Market Integration
“When the American economy sneezes, the rest of the world catches the cold?”
World Economy after World War 2
The development of economic globalization after WWII in the context of this prior epoch of
economic globalization, as well as its collapse as a result of WWI, the Depression, and the
WWI. All of these events had negative effects on almost all major economies (the US
economy was a major exception, at least in terms of the effect of the two world wars.)
What is Bretton Woods System?
 is a set of unified rules and policies that provided the framework necessary to
create fixed international currency exchange rates. Essentially, the agreement
called for the newly created IMF to determine the fixed rate of exchange for
currencies around the world.
 A key factor in the Depression was thought to be lack of cooperation among
nation-states. That lack of cooperation was associated with high tariffs and other
import restrictions and protectionist practices, as well as the propensity of
governments to devalue their currencies in order to gain an edge in global trade
over other countries. The latter also made exchange to rate wars.
The rise of World Organizations and World Agreements
o General Agreement on Tariffs and Trade (GATT)
o World Trade Organization (WTO)
o International Monetary Fund (IMF)
o World Bank (WB)
o Organization for Economic Cooperation and Development (OECD)
General Agreement on Tariffs and Trade (GATT)
 was a system for the liberalization of trade that grew out of Bretton Woods and
came into existence in 1947 (Hudec 1975).
World Trade Organization (WTO)
 is a multilateral organization headquartered in Geneva, Switzerland with 152
member nations as of 2008. Its focus on trade places it at the heart of economic
globalization and has made it a magnet for those opposed either to the broader
process of trade liberalization and promotion or to some specific aspect of WTO
operations.
 The WTO encompasses much of what was GATT’s mandate, but has moved on
other issues and areas such as services
International Monetary Fund (IMF)
 The goal of the IMF is macroeconomic stability for both member nations and the
global economy (Cardim de Carvalho 2007:658-63). More specifically the IMF
deals with exchange rates, balances of payments, international capital
flows, and the monitoring of member states and their macroeconomic policies.
World Bank (WB)
 officially the International Bank for Reconstruction and Development (IBRD) is the
most important element of the World Bank Group (WBG)(Gilbert and Vines
2000;Bradlow 2007:1262-7). The IBRD or Bank was established in 1944 at Bretton
Woods and began operations in 1946.
Organization for Economic Cooperation and Development (OECD)
 30 developed nations. The OECD is “the most encompassing ‘club’ of the world’s
rich countries”
Transnational Capitalism
 refers to the sum of all the relations between economic agents whether they are
state or private or of other mixed forms, any part of which crosses state borders.
LESSON 4
The Global Interstate System
Political Globalization
 The global flow of people, especially the illegal immigrants, poses a direct threat
to the nation-state and its ability to control its borders.
 The looming crisis associated with dwindling oil and water supplies threaten to
lead to riots and perhaps insurrections that could lead to the downfall of extant
governments
 The inability of the nation-state to control economic flows dominated by MNCs,
as well as the current economic and financial crisis that is sweeping the world,
also poses a profound threat to the nation-state.
 Environment problems of all sorts, especially those related to global warming, a
very likely to be destabilizing politically.
 Borderless disease, especially malaria, TB, and AIDS in Africa, pose a danger to
political structures.
 Global inequalities, especially the profound and growing North-South
split, threaten to pit poor nations against rich nations.
 War is the most obvious global flows threatening the nation-states involved,
especially those on the losing side.
The 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
Relation.
Institution that Govern international Relations The Effects of Globalization:

United Nations 1. Change Food Supply

United States President FRANKLIN ROOSEVELT coined the name united nations that  Food supply is no longer tried to the seasons. We can
was used in the declaration of United Nation on 1 of January 1942. UN means allies to fight buy food anywhere in the world at any time of the
against the Axis Powers in the Second World War II. year.
2. Division of Labour
Only 26 nation’s representatives pledge their governments to:  Because MNCs search for the cheapest locations to
manufacture and assemble components, production
1. Each Government pledges itself to employ its full resources, military or economic, process may be moved from developed to
against those members of the tripartite pact and its adherents with which such developing countries where costs are lower
government is at war.  Sometimes Asian countries are the target of MNCs
2. Each Government pledges itself to cooperate with the Governments signatory 3. Less Job Security
hereto and not to make a separate armistice or peace with the enemies. In the Global Economy jobs are becoming more
temporary and insecure
Free Trade Aggreements 4. Damage to the Environment
 are when two or more nations agree on the terms of trade between them. They  More trade means more transport which uses more
determine the tariffs and duties that countries impose on imports and exports. All fossil fuels and causes pollution
trade agreement affect international trade  Climate change is a serious threat to our future
5. Cultural Impact
Importing and Exporting  Websites such as YouTube connect people across the
 Import planet.
are goods and services produced in a foreign country and bought by  As the world becomes more unified, diverse cultures
domestic residents. are being ignored
 Exports  Different social media app influence people
are goods and services that are made in a country and sold outside its
borders. That includes anything shipped from a domestic company to its 6. Increase in Anti-Globalization Protest
foreign affiliate or branch.  People have begun to realize that globalization can
be challenged by communities supporting each
3 types of trade agreement other in business and society and through public
protest and political lobbying
 Unilateral
it occurs when a country imposes trade restrictions and no other country Advantages of Globalization
reciprocates. A country can also unilaterally loosen trade restrictions, but  Increase free trade between nations
that rarely happens.  Increase liquidity of capital allowing investors in developed nations to invest in
 Bilateral developing nations
are between two countries. Both countries agree to loosen  Corporations have greater flexibility to operate across borders
trade restrictions to expand business opportunities between them  Global mass media ties the world together
 Multilateral  Increase flow of communications allows vital information to be shared between
are the most difficult to negotiate. These are among three countries or individuals and corporations around the world
more.  Greater ease and speed of transportation for goods and people
 Reduction of cultural barriers increase the global village effect
LESSON 5  Spread the democratic ideals to developed nations
 Greater interdependence of nations states
Contemporary Global Governance  Reduction of likelihood of war between developed nations
 Increases in environmental protection in developed nations
What is Contemporary Global Governance?
 It brings together diverse actors to coordinate collective action at the level of the
planet. The goal of global governance, roughly defined, is to provide global
public goods, particularly peace and security, justice and mediation systems for
conflict, functioning markets and unified standards for trade and industry.
Nature of Global Governance
 Global Governance refers to the process of
designating standards, laws, rules,
\ or regulations
intended for a global scal

Role of Public International Law in Global Governance

 Public international law or law of nations, the body of
legal rules, norms and standards that apply between
sovereign states and other entities that are legally
recognized as international actors

International Subjects
 Sovereign states
 Organizations
 Non-states actors

Public International Law in Relation to Global Governance

 Public international law helps the states to address
and solve some global problems and concerns

Doctrine of Transportation vs Doctrine of Incorporation

 Doctrine of Transportation
Any international law must be consciously/mindfully
transformed through legislation before the said international
law could be implemented locally
 Doctrine of Incorporation
An automatic reception of the international law into domestic
law without formal needs for official legislation to sanction it
and give effect to it

Example International Law: United Conventions Law of the Sea

Example of International Law Subjects: Human Rights, World Trade, War, Migration

International Law vs Domestic Law

 International Law
Is a set of rules and principles governing the relations and
conduct of sovereign states with each other, as well as with
international organizations and individuals.
 Domestic Law
Body of law and rules existing within a country’s territory

1. International Treaty
It is an agreement formed by international actors, such as sovereign
states and international organizations under the international law.
Example of International Treaty: International agreement by unclos
2. International Customs
General practice accepted as law (Article 38 1B)
2 Elements: State Practice and Opinion Juris
Example: Head of State Immuni