GLOBALIZATION

AND FINANCE
Gracia Paramitha, PhD
 Content
01 What’s the correlation
between globalization and
finance?

02 What’s the impact of

globalization towards finance?

03 What is the benefit and

danger/challenge of global
financial crisis?

04 Conclusion
 What’s the correlations between
globalization and finance?

Global - regional Global currency - tax -

State’s deregulation
governance transaction

1. Bretton Wood system

1. government networks 1. the rise of regional 2. The World Bank and iMF’s
2. flexibility and development
governance 3. financial liberalization
informality
2. interconnected (Shaw and Mc Kinnon)
3. diversification of non-
world 4. institutional innovation -
state actors (the rise flux of financial
of private/business 3. plurilateralism - speculation (Minsky)
sectors) minilateralism 5. new contending
4. currency? BRICS
currency?

(Held, 1999)
 financial institutionalism
liberalization
crash/crisis of finance
of finance
-availability of secured asset
Global financial
-investment growth -financial governance
crisis 1998, 2008, -higher liquidity, (transparency and
2018 higher access to accountability)
e.g: European Stability
credit and investment
Mechanism, Basel III

Source: (Čaušević, 2017)

 Benefit and
challenge of
global finance
01
the rise of new nationalism : Brexit referendum
2016, Catalonia independence referendum of
2017, the 2018 New Caledonia referendum in
France (Amadi, 2020)

02
rise in trade protectionism at the heels of the new
US- led trade war with China, less liberal finance -
Cerny and Prichard (2017)termed ‘new global
anarchy’
03
spirit of multilateralism, the increasing
integration of economies around the world
(IMF. 2000)
04
divergence between high-income countries and the
developing world, with only a limited number (less than
10% of the economies in the world) (Lin and Rosenblatt,
2012).
Source: Lin and Rosenblatt’ elaboration (2012) based on data from Madison (2010)
 Country Composition of the Largest Banks in the World
Millions of US Dollars, as of beginning of 2008

Source: The Banker, July 2008.

China and India Shares of World GDP, Pre-Industrial Revolution, percent

Source: Lin and Rosenblatt’ elaboration (2012) based on data from Madison (2010)
THANK
YOU
gracia.paramitha09@ui.ac.id