SOCIOLOGY

An occasional lesson for Module 3 of Unit Two

Development, underdevelopment and Globalization. May 2005

© 2006 CASAH.

Concept - Globalization• Globalization (or globalisation) refers to the

worldwide phenomenon of technological, economic, political and cultural exchanges, brought about by modern communication, transportation and legal infrastructure as well as the political choice to consciously open cross-border links in international trade and finance. It is a term used to describe how places and human beings are becoming more intertwined with each other around the world economically, politically, and culturally. Although these globalization links are not new, they are more pervasive than ever before.

Concepts – GlobalizationMarxist View.• The dominant idea of contemporary

bourgeois thinking is that increasing international integration of economic activity, or “globalisation” will lead to prosperity and peace for all. But globalisation is not a concept that helps us understand the world around us. It is an ideological construct used to trumpet capitalist victory – to conceal the crisis-ridden nature of the system and its perpetual failure to meet the needs of the world’s working class. (Mick Brooks, 1991)

Globalization – Constructionist/ conservative • The International Monetary Fund defines globalization as “the growing

economic interdependence of countries worldwide through increasing volume and variety of cross-border transactions in goods and services, free international capital flows, and more rapid and widespread diffusion of technology”.

• Meanwhile, The International Forum on Globalization defines it as “the present worldwide drive toward a globalized economic system dominated by supranational corporate trade and banking institutions that are not accountable to democratic processes or national governments.”

• While notable critical theorists, such as Immanuel Wallerstein, emphasize that globalization cannot be understood separately from the historical development of the capitalist world-system the different definitions highlight the ensuing debate of the roles and relationships of government, corporations, and the individual in maximizing social welfare within the globalization paradigms.

• Nonetheless, it is clear that globalization has economic, political, cultural, and technological aspects that may be closely intertwined. Given that these aspects are key to an individual's quality of life, the social benefits and costs brought upon them by globalization generate strong debate.

Globalization• The economic aspects stressed in globalization are trade

, investment and migration. The globalization of trade entails that human beings have greater access to a plethora of goods and services never seen before in human history.

• From German cars, to Colombian coffee, from Chinese clothing, to Egyptian cotton, from American music to Indian software, human beings may be able to purchase a wide range of goods and services.

• The globalization of investment takes place through Foreign Direct Investment, where multinational companies directly invest assets in a foreign country, or by indirect investment where individuals and institutions purchase and sell financial assets of other countries. Free migration allows individuals to find employment in jurisdictions where there are labor shortages.

Critique of Globalisation• Critics of free trade also contend that it may lead to the

destruction of a country's native industry, environment and/or a loss of jobs.

• Critics of international investment contend that by accepting these financial schemes a country loses its economic sovereignty and may be forced to set policies that are contrary to its citizen's interests or desires.

• Moreover, multinational companies that invest in a country may also acquire too much political and economic power in relation to its citizens. Finally, migration may lead to the exploitation of workers from a migrant country and the displacement of workers from a host country.

• Critics of globalization also contend that different economic systems that either augment or supplant globalization may maximize social welfare more efficiently and equitably.

Political Viewpoint.• The political aspects of globalization are evidenced

when governments create international rules and institutions to deal with issues such as trade, human rights, and the environment. Among the new institutions and rules that have come to fruition as a result of globalization are the World Trade Organization, the Euro currency, the North American Free Trade Agreement, CSME, to name a few. Whether a government is to consciously open itself to cross-border links, is the central question of this aspect.

• In our case CARICOM, CSME, CCJ, CXC, WICB, UWI

Global Activism • Social activist and non-profit organizations are also

becoming more global in scope. These include Amnesty International and Greenpeace to mention a couple.

• Some of these organizations take issue with the economic and political aspects of globalization as they fear that economic interests either subvert the nation state in its ability to protect its citizens from economic exploitation, or support governments that violate the human rights of their citizens.

• Greenpeace protests the use of the Caribbean as a trans shipment point for nuclear fuel.

Cultural Standpoint.• Cultural global ties also grow through globalization as

news ideas and fashions through trade, travel and media move around the globe at lightning speed.

• Global brands such as Coca-Cola, Puma & Sony serve as common reference to consumers all over the World.

• An individual in China enjoys the same soft drink as an individual in Puerto Rico--at opposite ends of the globe.

• Wear a pair of K –Swiss in Kingston or NYC.• However, these ties may also cause strains: for example

Western Ideas of freedom of expression may clash with Islamic views on Religious tolerance.

• And if not strains, critics contend this is really an imposition of cultural imperialism in order to preserve economic interests.

Other views of it.• The other aspect of globalization is the revolutionary

change in technology, particularly in transport and communication, which ostensibly creates a global village.

• In 1850 it took nearly a year to sail around the World. Now you can fly around the world in a day, send an email anywhere almost instantly, or be part of the 1.5 billion viewers watching the final match of the World Cup.

• Transportation costs have come down as result of technological advances that make foreign markets more accessible to trade.

• Have Breakfast in Kingston and lunch in New York.• Tuna caught in the North Atlantic may be served the next

day at a Sushi restaurant in Japan. • Finally, billions of dollars in assets and currencies are

exchanged daily around the globe by electronic means at virtually no cost.

Characteristics • Globalization/internationalisa

tion has become identified with a number of trends, most of which may have developed since World War II. These include greater international movement of commodities, money, information, and people; and the development of technology, organizations, legal systems, and infrastructures to allow this movement. The actual existence of some of these trends is debated.

Economically • Increase in international trade at

a much faster rate than the growth in the world economy

• Increase in international flow of capital including foreign direct investment

• Creation of international agreements leading to organizations like the WTO and OPEC

• Development of global financial systems

• Increased role of international organizations such as WTO, WIPO, IMF that deal with international transactions

• Increase of economic practices like outsourcing, by multinational corporations

Cultural Characteristics. • Greater international cultural exchange, • Spreading of multiculturalism, and better individual

access to cultural diversity, for example through the export of Hollywood and Bollywood movies. However, the imported culture can easily supplant the local culture, causing reduction in diversity through hybridization or even assimilation. The most prominent form of this is Westernization, but Sinicization of cultures also takes place.

• Greater international travel and tourism • Greater immigration, including illegal immigration • Spread of local foods such as pizza and Indian food

to other countries (often adapted to local taste)

Economic and Political• Development of a global telecommunications infrastructure and

greater transborder data flow, using such technologies as the Internet, communication satellites and telephones

• Increase in the number of standards applied globally; e.g. copyright laws and patents

• Formation or development of a set of universal values • The push by many advocates for an international criminal court

and international justice movements (see the International Criminal Court and International Court of Justice respectively).

• It is often argued that even terrorism has undergone globalization, with attacks in foreign countries that have no direct relation with the own country.

• Barriers to international trade have been considerably lowered since World War II through international agreements such as the General Agreement on Tariffs and Trade (GATT). Particular initiatives carried out as a result of GATT and the WTO, for which GATT is the foundation, have included:

Promotion of free trade • Of goods:

• Reduction or elimination of tariffs; construction of free trade zones with small or no tariffs

• Reduced transportation costs, especially from development of containerization for ocean shipping.

• Of capital: reduction or elimination of capital controls • Reduction, elimination, or harmonization of subsidies for

local businesses • Intellectual property restrictions • Harmonization of intellectual property laws across

nations (generally speaking, with more restrictions) • Supranational recognition of intellectual property

restrictions (e.g. patents granted by China would be recognized in the US)

Source – Wikipedia