CHAPTER 1: DEFINING GLOBALIZATION

LESSON 1B

The Task of Defining Globalization

The literature on the definitions of globalization revealed that definitions could be classified as either
(1) broad and inclusive
(2) narrow and exclusive.
DEFINITIONS OF GLOBALIZATION

• Ohmae in 1992 stated, "... globalization means the onset of the borderless world..." (p. 14). This is an
example of a broad and inclusive type of definition.
• Robert Cox's definition suits best in this type: "the characteristics of the globalization trend include the
internationalizing of production, the new international division of labor, new migratory movements from
South to North, the new competitive environment that accelerates these processes, and the
internationalizing of the state... making states into agencies of the globalizing world" (as cited in RAWOO
Netherlands Development Assistance Research Council, 2000, p. 14).
• No matter how one classifies a definition of globalization, the concept is complex and multifaceted as the
definitions deal with either economic, political, or social dimensions.
• Ritzer (2015), "globalization is a transplanetary process or a set of processes involving increasing liquidity
and the growing multidirectional flows of people, objects, places, and information as well as the structures
they encounter and create that are barriers to, or expedite, those flows..." (p. 2)
• globalization could bring either or both integration and/or fragmentation.
• In 1996, Arjun Appadurai said, "globalization is a 'world of things' that have 'different speeds, axes, points
of origin and termination, and varied relationships to institutional structures in different regions, nations, or
societies" (as cited in Chowdhury, 2006, p. 137).
• In a more recent study, Al-Rhodan (2006) suggest the perspective of the author on the origins and the
geopolitical implications of globalization. It is a starting point that will guide the rest of any discussions. In
effect, one's definition and perspective could determine concrete steps in addressing the issues of
globalization.
• Cesare Poppi: Globalization is the debate and the debate is globalization. One became part and parcel of
the other. As Poppi (1997) wrote: "The literature stemming from the debate on globalization has grown in
the last decade beyond any individual's capability of extracting a workable definition of the concept. In a
sense, the meaning of the concept is self- evident, in another, it is vague and obscure as its reaches are
wide and constantly shifting. Perhaps, more than any other concept, globalization is the debate about it"
(as cited in Kumar, 2003, p. 95).
• Globalization is a reality. It is changing as human society develops.
• In his article, "The Globalization of Nothing," Ritzer (2003) said, "attitudes toward globalization depend,
among other things, on whether one gains or losses from it"

Metaphors of Globalization

✓ Metaphors make use of one term to help us better understand another term.

Solid and Liquid

➢ Solidity also refers to barriers that prevent or make difficult the movement of things. Furthermore, solids
can either be natural or man- made. Examples of natural solids are landforms and bodies of water. Man-
made barriers include the Great Wall of China and the Berlin Wall.
➢ Liquid, as a state of matter, takes the shape of its container. Moreover, liquids are not fixed. Liquidity,
therefore, refers to the increasing ease of movement of people, things, information, and places in the
contemporary world.
Zygmunt Bauman's ideas were the ones that have much to say about the characteristic of liquidity.
First, today's liquid phenomena change quickly and their aspects, spatial and temporal, are in
continuous fluctuation. This means that space and time are crucial elements of globalization. In
global finance, for instance, changes in the stock market are a matter of seconds.
Another characteristic of liquid phenomena is that their movement is difficult to stop. For example,
videos uploaded a on YouTube or Facebook are unstoppable once they become viral. The so-
called Internet sensations become famous not only in their homeland but also to the entire world.
Finally, the forces (the liquid ones) made political boundaries more permeable to the flow of people
and things (Cartier, 2001). This brings us to what Ritzer (2015, p. 6) regarded as the most important
characteristic of liquid: it "tends to melt whatever stands in its path (especially solids)." The clearest
example is the decline, if not death, of the nation-state.
➢ Liquidity and solidity are in constant interaction. However, liquidity is the one increasing and proliferating
today. Therefore, the metaphor that could best describe globalization is liquidity.

Flows
➢ Flows are the movement of people, things, places, and information brought by the growing "porosity" of
global limitations (Ritzer, 2015).
Examples:
a. Eating foreign foods
b. Global financial crisis
c. Poor illegal migrants flooding many parts of the world
d. Filipino communities abroad and the Chinese communities in the Philippines.
e. Virtual flow of legal and illegal information such as blogs and child pornography, respectively,
and immigrants recreating ethnic enclaves in host countries

Globalization Theories

❖ Homogeneity refers to the increasing sameness in the world as cultural inputs, economic factors, and political
orientations of societies expand to create common practices, same economies, and similar forms of government.
 ✓ Homogeneity in culture is often linked to cultural imperialism. This means, a given culture influences other
cultures.
✓ Global economic crises are also products of homogeneity in economic globalization. Stiglitz (2002), for
instance, blamed the International Monetary Fund (IMF) for its "one-size-fits all" approach which treats
every country in the world as the same.
✓ Barber (1995) said that "McWorld" is existing. It means only one political orientation is growing in today's
societies. The global flow of media is often characterized as media imperialism.
✓ Cultural imperialism denies the agency of viewers, but people around the world often interpret the same
medium (e.g., a movie) in significantly different ways.
✓ Globalization, in contrast to glocalization, is a process wherein nations, corporations, etc. impose
themselves on geographic areas in order to gain profits, power, and so on (Ryan, 2007).
✓ Ritzer (2007) also espoused the idea that globalization can also be seen as a flow of "nothing" as opposed
to "something," involving the spread of non-places, non- things, non-people, and non-services.

❖ Heterogeneity pertains to the creation of various cultural practices, new economies, and political groups because
of the interaction of elements from different societies in the world.
✓ Heterogeneity refers to the differences because of either lasting differences or of the hybrids or
combinations of cultures that can be produced through the different transplanetary processes.
✓ Heterogeneity in culture is associated with cultural hybridization. A more specific concept is "glocalization"
coined by Roland Robertson in 1992. To him, as global forces interact with local factors or a specific
geographic area, the "glocal" is being produced. Although homogeneity and heterogeneity give us idea
about the effects of globalization, the picture is not yet complete.

LESSON 1C

Dynamics of Local and Global Culture

✓ Cultural globalization is the transmission of ideas, meanings, and values around the world in such a way as to
extend and intensify social relations.

There are three perspectives on global cultural flows. These are;

CULTURAL DEFFERENTIALISM

▪ emphasizes the fact that cultures are essentially different and are only superficially affected by
global flows.
▪ A key concept is "glocalization" or the interpenetration of the global and local resulting in unique
outcomes in different geographic areas.

CULTURAL HYBRIDIZATION

▪ emphasizes the integration of local and global cultures.

▪ A key concept is "glocalization" or the interpenetration of the global and local resulting in unique
outcomes in different geographic areas.

CULTURAL CONVERGENCE

▪ Stresses homogeneity introduced by globalization

▪ It is also called as cultural imperialism which happens when one culture imposes itself on and tends
to destroy at least parts of another culture.
▪ Cultures are deemed to be radically altered by strong flows, while cultural imperialism happens
when one culture imposes itself on and tends to destroy at least parts of another culture
▪ John Tomlinson's idea of "deterritorialization" of culture - loss of the "natural" relation between
culture and the social and geographic territories.

The Globalization of Religion

▪ Globalization has played a tremendous role in providing a context for the current revival and the resurgence
of religion.

▪ Globalization provided religions a fertile milieu to spread and thrive.

▪ As Scholte (2005) made clear: "Accelerated globalization of recent times has enabled co-religionists across
the planet to have greater direct contact with one another. Global communications, global organizations,
global finance, and the like have allowed ideas of the Muslims and the universal Christian church to be
given concrete shape as never before" (p. 245).

▪ Information technologies, transportation means, and the media are deemed important means on which
religionists rely on the dissemination of their religious ideas. For instance, countless websites that provide
information about religions have been created. In addition, the Internet allows people to contact each other
worldwide and therefore hold forums and debates that allow religious ideas to spread.

▪ Media also play an important role in the dissemination of religious ideas. In this respect, a lot of television
channels, radio stations, and print media are founded solely for advocating religions.

▪ Modern transportation has also contributed considerably to the emergence, revivalism, and fortification of
religion.
 ▪ Modern technology, therefore, has helped religions of different forms, such as fundamentalist, orthodox, or
modernist to cross geographical boundaries and be present everywhere.

▪ Globalization has also allowed religion or faith to gain considerable significance and importance as a non-
territorial touchstone of identity.

▪ As Turner (2007) explained: Globalization transforms the generic "religion" into a world-system of
competing and conflicting religions.

▪ Globalization has, therefore, had the paradoxical effect of making religions more self-conscious of
themselves as being "world religions."

▪ Though religion is strengthened and fortified by globalization, it represents a challenge to globalization's

hybridizing effects. Religion seeks to assert its identity in the light of globalization. As a result, different
religious identities come to the fore and assert themselves. Such assertions of religious identities constitute
a defensive reaction to globalization. Scholte (2005), in this respect, maintained, "At the same time as being
pursued through global channels, assertions of religious identity have, like nationalist strivings, often also
been partly a defensive reaction to globalization"

▪ It has been difficult for religion to cope with values that accompany globalization like liberalism,
consumerism, and rationalism. Such phenomena advocate scientism and secularism. This, in fact, pushed
Scholte to speak of the anti-rationalist faiths. Since he equated rationalism with globalization and
considered religion anti-rationalist, it can be deduced that religion is anti- globalization. To quote Scholte
(2005):

▪ Transplanetary relations have helped to stimulate and sustain some renewals of anti-rationalist faith, but
global networks have more usually promoted activities involving rationalist knowledge.

▪ Contemporary revivalist movements have largely replayed a long-term tendency-one that well predates
contemporary accelerated globalization-whereby certain religious circles have from time to time revolted
against modern secularism and

▪ Globalization is also associated with Westernization and Americanization.

▪ The challenges of globalization to religion link automatically to the challenges of religion to globalization. In
other words, while religion takes caution against the norms and the values related to globalization, it
challenges the latter since religion does not approve its hybridizing effects.

▪ The idea of de-hybridizing effects of religion is approved also by Samuel Huntington's clash of civilizations,
which maintains that such dehybridizing upshots spring also from the religious partitioning and clashes.

Globalization and Regionalization

▪ The processes of globalization and regionalization reemerged during the 1980s and heightened after the
end of the Cold War in the 1990s.
GLOBALIZATION

It is the process of international integration arising from the interchange of world views, products, ideas, and other
aspect such

as technology etc.

REGIONALIZATION
o It is the process of dividing an area into smaller segments called regions.
o Examples: division of nation into states or provinces | business also used regionalization as management
tool

RELATIONSHIP BETWEEN REGIONALIZATION AND GLOBALIZATION

The age of economic globalization has also been the age of regionalization, and much of the analysis of
the new regionalism has been devoted to the links between the two tendencies. Thus, regionalism is seen as
critical part of the political economy of globalization and the strategies that states (and other actors) have adopted
in the face of globalization... The emergence of regionalism needs to be understood within the global restructuring
of power and production. The many worlds are very closely intertwined with the character and fate of the one. The
core driving force is global even if the manifestation is regional. (Hurrel, 2007)

LESSON 1D

Origins and History of Globalization

Five different perspectives regarding the origins of globalization:

✓ Hardwired

According to Nayan Chanda (2007), it is because of our basic human need to make our lives better that made
globalization possible. Therefore, one can trace the beginning of globalization from our ancestors in Africa who walked out
from the said continent in the late Ice Age. This long journey finally led them to all- known continents today, roughly after
50,000 years.
 Chanda (2007) mentioned that commerce, religion, politics, and warfare are the "urges" of people toward a better
life. These are respectively connected to four aspects of globalization and they can be traced all throughout history: trade,
missionary work, adventures, and conquest.

✓ Cycles

For some, globalization is a long-term cyclical process and thus, finding its origin will be a daunting task. What is
important is the cycles that globalization has gone through (Scholte, 2005). Subscribing to this view will suggest adherence
to the idea that other global ages have appeared. There is also the notion to suspect that this point of globalization will soon
disappear and reappear.

✓ Epoch

Ritzer (2015) cited Therborn's (2000) six great epochs of globalization. These are also called "waves" and each has
its own origin. Today's globalization is not unique if this is the case. The difference of this view from the second view (cycles)
is that it does not treat epochs as returning. The following are the sequential occurrence of the epochs:

1. Globalization of religion (fourth to seventh centuries)

2. European colonial conquests (late fifteenth century)
3. Intra-European wars (late eighteenth to early nineteenth centuries)
4. Heyday of European imperialism (mid-nineteenth century to 1918)
5. Post-World War II period
6. Post-Cold War period

✓ Events

Specific events are also considered as part of the fourth view in explaining the origin of globalization. If this is the
case, then several points can be treated as the start of globalization. Gibbon (1998), for example, argued that Roman
conquests centuries before Christ were its origin. In an issue of the magazine the Economist (2006, January 12), it
considered the rampage of the armies of Genghis Khan into Eastern Europe in the thirteenth century.

Broader, More Recent Changes

Recent changes comprised the fifth view. These broad changes happened in the last half of the twentieth century.
Scholars today point to these three notable changes as the origin of globalization that we know today. They are as follows:

1. The emergence of the United States as the global power (post-World War II)
2. The emergence of multinational corporations (MNCs)
3. The demise of the Soviet Union and the end of the Cold War

Global Demography

✓ Demography refers to numerous techniques that can be utilized to statistically assess the population of a given
area.
✓ Demographic transition is a singular historical period during which mortality and fertility rates decline from high to
low levels in a particular country or region. The broad outlines of the transition are similar in countries around the
world, but the pace and timing of the transition have varied considerably.

What is the Demographic Transition Model?

The Demographic Transition Model (DTM) is based on historical population trends of two demographic characteristics –
birth rate and death rate – to suggest that a country’s total population growth rate cycles through stages as that country
develops economically.

What are the stages of the Demographic Transition Model?

✓ Stage 1, HIGH STATIONARY - which applied to most of the world before the Industrial Revolution, both birth rates
and death rates are high. As a result, population size remains fairly constant but can have major swings with events
such as wars or pandemics.

Birth Rate is high as a result of:

• Lack of family planning

• High Infant Mortality Rate: putting babies in the 'bank'
 • Need for workers in agriculture
• Religious beliefs
• Children as economic assets

Death Rate is high because of:

• High levels of disease

• Famine
• Lack of clean water and sanitation
• Lack of health care
• War
• Lack of education

✓ Stage 2, EARLY EXPANDING- the introduction of modern medicine lowers death rates, especially among children,
while birth rates remain high; the result is rapid population growth. Many of the least developed countries today are
in Stage 2.

Death Rate is falling as a result of:

• Improved health care (Smallpox Vaccine)

• Improved Hygiene (Water for drinking boiled)
• Improved sanitation
• Improved food production and storage
• Improved transport for food
• Decreased Infant Mortality Rates

✓ Stage 3, LATE EXPANDING- birth rates gradually decrease, usually as a result of improved economic conditions,
an increase in women’s status, and access to contraception. Population growth continues, but at a lower rate. Most
developing countries are in Stage 3.

Reasons:

• Family planning available

• Lower Infant Mortality Rate
• Increased mechanization reduces need for workers
• Increased standard of living
• Changing status of women

✓ Stage 4, LOW STATIONARY- birth and death rates are both low, stabilizing the population. These countries tend
to have stronger economies, higher levels of education, better healthcare, a higher proportion of working women,
and a fertility rate hovering around two children per woman. Most developed countries are in Stage 4.
✓ Stage 5, DECLINING- would include countries in which fertility rates have fallen significantly below replacement
level (2 children) and the elderly population is greater than the youthful population.

Global Migration

✓ The nuances of the movements of people around the world can be seen through the categories of migrants-
"vagabonds" and "tourists" (Bauman, 1998).
✓ Vagabonds are on the move "because they have to be" they are not faring well in their home countries and
are forced to move in the hope that their circumstances will improve.
✓ Tourists, on the other hand, are on the move because they want to be and because they can afford it.
✓ Refugees are vagabonds forced to flee their home countries due to safety concerns.
✓ Labor migration is driven by "push" factors (eg, lack of employment opportunities in home countries), as
well as "pull" factors (work available elsewhere).
✓ Labor migration mainly involves the flow of less-skilled and unskilled workers, as well as illegal immigrants
who live on the margins of the host society
✓ Migration is traditionally governed either by "push" factors such as political persecution, economic
depression, war, and famine in the home country or by "pull" factors such as a favorable immigration policy,
a labor shortage, and a similarity of language and culture in the country of destination (Ritzer, 2015).
✓ The term "diaspora" has been increasingly used to describe migrant communities. Diasporization and
globalization are closely interconnected and the expansion of the latter will lead to an increase in the former
(Dufoix, 2007). Today, there exists "virtual diasporas" (Laguerre, 2002) which utilize technology such as
the internet to maintain the community network.

CHAPTER 2: GLOBAL ECONOMY

Introduction
The United Nations (UN) tried to address the different problems in the world. Their efforts were guided by the eight
Millennium Development Goals, which they created in the 1990s. The UN tried to achieve them by the year 2015 (United
Nations, 2015).
Eight Millennium Development Goals:
1. Among these eight goals, the eradication of extreme poverty and hunger ranked as the first.
2. Achieving universal primary education
3. Promoting gender equality and women empowerment
4. Reducing child mortality
 5. Improving maternal health
6. Combating diseases like HIV/AIDS and malaria
7. Ensuring environmental sustainability
8. Having a global partnership for development
Economic Globalization and Global Trade
According to the United Nations (as cited in Shangquan, 2000), "Economic globalization refers to the increasing
interdependence of world economies as a result of the growing scale of cross-border trade of commodities and services,
flow of international capital, and wide and rapid spread of technologies. It reflects the continuing expansion and mutual
integration of market frontiers, and is an irreversible trend for the economic development in the whole world at the turn of
the millennium." (p. 1)
There are two different types of economies associated with economic globalization:

• Protectionism means "a policy of systematic government intervention in foreign trade with the objective of
encouraging domestic production. This encouragement involves giving preferential treatment to domestic
producers and discriminating against foreign competitors" (McAleese, 2007 as cited in Ritzer, 2015, p.
1169). Trade protectionism usually comes in the form of quotas and tariffs. Tariffs are required fees on
imports or exports.
• World War II heavily influenced the shifting of the dominant economic policy from protectionism to trade
liberalization or free trade. Free trade agreements and technological advances in transportation and
communication mean goods and services move around the world more easily than ever. We are talking
about everything from shoes and bananas to innovations and ideas. Let us take mobile phones as an
example. Mobile phones seem to have good consequences for everything including reducing poverty.
• Globalization made some countries, especially the developing ones, to gain more in the global economy at
the expense of other nations. There are various ways, however, the country can make trade easier with
other countries while lessening the inequities in the global world. One of them is "fair trade" (Nicholls and
Opal, 2005).
• Fair trade, as defined by the International Fair-Trade Association, is the "concern for the social, economic,
and environmental well- being of marginalized small producers" (Downie, 2007, pp. C1-C5). It aims for a
more moral and equitable global economic system. Specifically, it is concerned with protection of workers
and producers, establishment of more just prices, engagement in environmentally sound practices and
sustainable production, creation of relationships between producers in the South and consumers in the
North, and promotion of safe working environment.
Economic Globalization and Sustainable Development
There are some significant downsides to globalize trade and perhaps the strongest argument against economic
globalization is its lack of sustainability or the degree to which the earth's resources can be used for our needs, even in the
future. Specifically, the development of our world today by using the earth's resources and the preservation of such sources
for the future is called sustainable development.
In other words, development has to be ensured in and for the future- generations. One significant global response
or approach to economic globalization is that of sustainable development, which seeks to chart a middle path between
economic growth and a sustainable environment (Borghesi and Vercelli, 2008). The relationship between globalization and
sustainability is multi- dimensional-it involves economic, political, and technological aspects.
The continuous production of the world's natural resources, such as water and fossil fuel allow humanity to discover
and innovate many things. We were able to utilize energy, discover new technologies, and make advancements in
transportation and communication. However, these positive effects of development put our environment at a disadvantage.
Climate change accelerated and global inequality was not eradicated. This means that development, although beneficial at
one hand, entails cost on the other.

Environmental Degradation
Development, especially economic development, was hastened by the Industrial Revolution. This is the period in
human history that made possible the cycle of efficiency. Efficiency means finding the quickest possible way of producing
large amounts of a particular product. This process made buying of goods easier for the people. Then, there is an increased
demand. Ultimately, there was an increased efficiency. This cycle harms the planet in a number of ways. For instance, the
earth's atmosphere is damaged by more carbon emissions from factories around the world.
Deforestation, pollution, and climate change will not adjust for us, especially if increases in living standards lead
people to demand more consumer goods like cars, meat, and smartphones.
Harvey (2005) noted that neoliberals and environmentalists debate the impact of free trade on the environment.
Environmentalists argue that environmental issues should be given priority over economic issues (Antonio, 2007). Free
trade, through its emphasis on the expansion of manufacturing, is associated with environmental damage. For their part,
neoliberals see the efforts of the environmentalists as serious impediments to trade. Some seek to integrate these
approaches. For instance, ecological modernization theory sees globalization as a process that can both protect and
enhance the environment (Yearley, 2007),
Various efforts are underway to deal with climate change. However, strong resistance on the part of governments
and corporations counters these. For instance, the Kyoto Protocol aimed at a reduction of global carbon emissions, but
failed to take off largely because it was not ratified by the United States (Armitage, 2005). However, momentum is being
built up in corporate circles in dealing with environmental problems.
There are significant challenges involved in implementing various measures such as "carbon tax" and "carbon
neutrality" to deal with environmental problems (Ritzer, 2015). It is also difficult to find alternatives to fossil fuels. For
instance, Barrionuevo (2007) stated that the use of ethanol as an alternative to gasoline has an attendant set of problems-
it is less efficient and it has led to an escalation in the price of corn, which currently serves as a major source of ethanol.
Although biofuels themselves produce lower emissions, their extraction and transport contribute significantly to total
emissions.
Previous experience in dealing with environmental issues indicates that a global view of the problem is required. A
focus on specific regions, such as Europe, overlooks impacts in other regions. Instead of dealing with the causes of global
warming, there is some interest in "technological fixes" such as geoengineering (Dean, 2007).
Food Security
The demand for food will be 60% greater than it is today and the challenge of food security requires the world to
feed 9 billion people by 2050 (Breene, 2016). Global food security means delivering sufficient food to the entire world
population. It is, therefore, a priority of all countries, whether developed or less developed. The security of food also means
the sustainability of society such as population growth, climate change, water scarcity, and agriculture. Breene (2016) cited
the case of India to show how complex the issue of food security is in relation to other factors:
Agriculture accounts for 18% of the economy's output and 47% of its workforce. India is the second biggest producer
of fruits and vegetables in the world. Yet according to the Food and Agriculture Organization (FAO) of the United
Nations, some 194 million Indians are undernourished, the largest number of hungry people in any single country.
An estimated 15.2% of the population of India are too malnourished to lead a normal life. A third of the world's
malnourished children live in India (n.p.).
But perhaps the closest aspect of human life associated with food security is the environment. The challenges to
food security can be traced to the protection of the environment. A major environmental problem is the destruction of natural
habitats, particularly through deforestation (Diamond, 2006). Industrial fishing has contributed to a significant destruction of
marine life and ecosystems (Goldburg, 2008). Biodiversity and usable farmland have also declined at a rapid pace.
Another significant environmental challenge is that of the decline in the availability of fresh water (Conca, 2006).
The decline in the water supply because of degradation of soil or desertification (Glantz, 1977), has transformed what was
once considered a public good into a privatized commodity. The poorest areas of the globe experience a disproportionate
share of water-related problems. The problem is further intensified by the consumption of "virtual water," wherein people
inadvertently use up water from elsewhere in the world through the consumption of water-intensive products (Ritzer, 2015).
The destruction of the water ecosystem may lead to the creation of "climate refugees, people who are forced to migrate due
to lack of access to water or due to flooding" (Ritzer, 2015, p. 211).
Pollution through toxic chemicals has had a long-term impact on the environment. The use of persistent organic
pollutants (POPS) has led to significant industrial pollution (Dinham, 2007). Greenhouse gases, gases that trap sunlight and
heat in the earth's atmosphere, contribute greatly to global warming. In turn, this process causes the melting of land-based
and glacial ice with potentially catastrophic effects (Revkin, 2008), the possibility of substantial flooding, a reduction in the
alkalinity of the oceans, and destruction of existing ecosystems. Ultimately, global warming poses a threat to the global
supply of food as well as to human health (Brown, 2007). Furthermore, population growth and its attendant increase in
consumption intensify ecological problems. The global flow of dangerous debris is another major concern, with electronic
waste often dumped in developing countries.
There are different models and agenda pushed by different organizations to address the issue of global food
security. One of this is through sustainability.

LESSON 2B

Economic Globalization, Poverty, and Inequality

The Swedish statistician Hans Rosling once said, "The 1 to 2 billion poorest in the world who don't have food for
the day suffer from the worst disease, globalization deficiency. The way globalization is occurring could be much
better, but the worst thing is not being part of it."
Economic and trade globalization is the result of companies trying to outmaneuver their competitors.
This process creates winners and losers. The winners include corporations and their stockholders who earn more
profit. They also include consumers who get products at a cheaper price. The losers are high wageworkers who
used to make those shoes. Their jobs moved overseas.
The multiplier effect means an increase in one economic activity can lead to an increase in other economic
activities. For instance, investing in local businesses will lead to more jobs and more income. According to the
economist Paul Krugman (as cited in The New York Times, July 8, 2013), "The Bangladeshi apparel industry is
going to consist of what we would consider sweatshops or it won't exist at all. And Bangladesh, in particular, really
really needs its apparel industry. It's pretty much the only thing keeping its economy afloat."
Opponents of economic globalization called the outsourcing of jobs as exploitation and oppression
A form of economic colonialism that puts profits before people. A few call for protectionist policies like higher tariffs
and limitations on outsourcing.
In the absence of regulation, it is still possible that workers would not be horribly mistreated. First, public awareness
is growing along with the pressure from the international community to take steps to protect workers.. The second
step comes from those that support globalization. The pro-globalization set argues that as developing economies
grow, there are more opportunities for workers, which leads to more competition for labor and higher wages.
Economic globalization has helped millions of people get out of extreme poverty but the challenge of the future is
to lift up the poor while at the same time keep the planet livable.
One of the best ways to help those in extreme poverty is to enable them to participate in the economy.

Global Income Inequality

Globalization and inequality are closely related. We can see how different nations are divided between the North
and the South, developed and less developed, and the core and the periphery. These differences mainly reflect
one key aspect of inequality in the contemporary world-global economic inequality.
There are two main types of economic inequality: wealth inequality and income inequality. Wealth refers to the net
worth of a country. It takes into account all the assets of a nation-may they be natural, physical, and human-less
the liabilities. In other words, wealth is the abundance of resources in a specific country. This means that wealth
inequality speaks about distribution of assets.
 “Economic big bang” by Branko Milanovic
Complement skilled workers but replaced by unskilled workers

The Third World and the Global South

The terms date back to the Cold War, when Western policymakers began talking about the world as three distinct
political and economic blocs (Tomlinson, 2003). Western capitalist countries were labeled as the "First World." The Soviet
Union and its allies were termed the "Second World." Everyone else was grouped into "Third World." After the Cold War
ended, the category of Second World countries became null and void, but somehow the terms "First World" and "Third
World" stuck around in the public consciousness.

Third World countries, which started as just a vague catchall term for non-alliance countries, came to be associated
with impoverished states, while the First World was associated with rich, industrialized countries.
First World
-The bloc of democratic-industrialized countries within the American sphere of influence, the “First World”,
also known as THE WEST.
Second World
-Refers to the former communist-socialist, less industrialized states known as the EASTERN BLOC
Third World
-The remaining three-quarters of the world population, countries that did not belong to either bloc, were
considered “THIRD WORLD.
A new and simpler classification, North-South
First World countries as “Global North”
The global south consists of the poorest and least industrialized counties, which are mainly in the southern part of
the world.

The Global City

The rural-urban differentiation has a significant relationship to globalization, Globalization has deeply altered North-
South relations in agriculture.
Rural economies are exposed to low prices and mass migration.
Sassen (1991) used the concept of global cities to describe the three urban centers of New York, London, and
Tokyo as economic centers that exert control over the world's political economy.
Cities are centers of innovations and businesses
They portray the economic, social, and political state of the country and its people.
To be considered a global city, an urban center must prove it enjoys a significant global advantage over the other
cities and serves as a hub within the world economic system.
These cities possess several similar characteristics including:
• Home to several financial service providers and institutions
• Headquarters to large multinationals
• Dominate the trade and economy of their countries
• Major hub for air, land and sea transport
• They ae also centers of innovation
• Boast of well-developed infrastructure
• Large population of employed people
• Act as the centers of communication of global news.
•

LESSON 2C

Theories of Global Stratification

Modernization Theory

✓ This theory frames global stratification as a function of technological and cultural differences between
nations.

✓ It specifically pinpoints two historical events that contributed to Western Europe developing at a faster rate
than much of the rest of the world.

✓ The first event is known as the Columbian Exchange. This refers to the spread of goods, technology,
education, and diseases between the Americas and Europe after Christopher Columbus's so-called
"discovery of the Americas.". The Columbian Exchange worked out much less well, however, for Native
Americans whose populations were ravaged by the diseases brought from Europe. It is estimated that in
the 150 years following Columbus's first trip, over 80% of the Native American population died due to
diseases such as smallpox and measles.

✓ The second historical event is the Industrial Revolution in the eighteenth and nineteenth centuries. This is
when new technologies, like steam power and mechanization, allowed countries to replace human labor
with machines and increase productivity. The Industrial Revolution, at first, only benefited the wealthy in
Western countries. Industrial technology was very productive that it gradually began to improve standards
of living for everyone. Countries that industrialized in the eighteenth and nineteenth centuries saw massive
improvements in their standards of living and countries that did not industrialize lag behind.

✓ Modernization theory rests on the idea that affluence could be attained by anyone. Modernization theory
argues that the tension between tradition and technological change is the biggest barrier to growth. A
society that is more steeped in family systems and traditions may be less willing to adopt new technologies
and the new social systems that often accompany them.
 Walt Rostow's Four Stages of Modernization

According to American economist Walt Rostow, modernization in the West took place, as it always tends to, in four
stages.

1. Traditional stage- refers to societies that are structured around small, local communities with
production typically being done in family settings. Because these societies have limited resources
and technology, most of their time is spent on laboring to produce food, which creates a strict social
hierarchy.

2. Take-off stage- people begin to use their individual talents to produce things beyond the
necessities. This innovation creates new markets for trade. In turn, greater individualism takes hold
and social status is more closely linked with material wealth.

3. The drive to technological maturity- in which technological growth of the earlier periods begins
to bear fruit in the form of population growth, reductions in absolute poverty levels, and more diverse
job opportunities. Nations in this phase typically begin to push for social change along with
economic change, like implementing basic schooling for everyone and developing more democratic
political systems.

4. High mass consumption- It is when your country is big enough that production becomes more
about wants than needs. Many of these countries put social support systems in place to ensure
that all of their citizens have access to basic necessities.

Critics of modernization theory argue that, in many ways, it is just a new name for the idea that capitalism is the
only way for a country to develop. These critics point out that even as technology has improved throughout the
world, a lot of countries have been left behind. They also argue that modernization theory sweeps a lot of
historical factors under the rug when it explains European and North American progress.

Dependency Theory and the Latin American Experience

Dependency theory was a product of this experience.

Dependency is the condition in which the development of the nation-states of the South contributed to a decline in
their independence and to an increase in economic development of the countries of the North (Cardoso and Felato,
1979).

In addition, it argues that liberal trade causes greater impoverishment, not economic improvement, to less
developed countries (Toye, 2003)

In addition, it argues that in a world of finite resources, we cannot understand why rich nations are rich without
realizing that those riches came at the expense of another country being poor. In this view, global stratification starts
with colonialism.

Dependency theory was initially developed by Hans Singer and Raul Prebisch in the 1950s and has been improved
since then.

The two main sub-theories are the North American Neo-Marxist approach and the Latin American structuralist
approach (Sanchez, 2014).

Neo-Marxist Approach- less developed countries would develop by following the path taken by the developed
countries.

Structuralist Approach – was developed mainly by Latin American

The terms "core nations" and "peripheral nations"! are at the heart of dependency theory.

Peripheral nations are countries that are less developed and receive an unequal distribution of the world's wealth.

Core countries, are more industrialized nations who receive the majority of the world's wealth. Although generally
divided into core or peripheral, dependency theorists recognize that there are a number of different kinds of states
in the world (Grosfoguel, 2000).

Dependency theorists saw that the development of peripheral nations is stagnant because of the exploitative nature
of the core nations (Ferraro, 2008). Less developed periphery countries are said to primarily serve the interests of
the wealthier countries and end up having little to no resources to put toward their own development. The theory
points out that the economies of periphery countries rely on manual labor and to the export of raw materials to core
nations. The core countries then process these raw materials and sell them at a much higher price. Some of these
manufactured goods go right back to the periphery countries from which the raw materials came. Periphery nations
end up spending more money on the processed goods. Their small economies may also rely on core nations for
medical and nutritional aid. The dependency theory describes a vicious cycle that enforces a hierarchy of nations
across the globe. Some countries were not developing around the world because the international system was
actually preventing them from doing so.

Dependency is not a general theory of underdevelopment, but rather a "methodology for the analysis of concrete
situations of dependency".

The idea of dependence refers to the conditions under which alone the economic and political system can exist and
function in its connections with the world productive structure". In other words, the very use of the term "dependency"
 was used to underscore the extent to which the economic and political development of poor countries was
conditioned by the global economy, whose center of gravity was located in the developed nations.

The Modern World-System

This history of colonialism inspired American sociologist Immanuel Wallerstein model of what he called the capitalist
world economy.

Wallerstein described high-income nations as the "core" of the world economy. This core is the manufacturing base
of the planet where resources funnel in to become the technology and wealth enjoyed by the Western world today.

Low-income countries, meanwhile, are Wallerstein called the "periphery," whose natural resources and labor
support the wealthier countries, first as colonies and now by working for multinational corporations under
neocolonialism. Middle-income countries, such as India or Brazil, are considered the semi-periphery due to their
closer ties to the global economic core.

In Wallerstein's model, the periphery remains economically dependent on the core in a number of ways, which tend
to reinforce each other. First, poor nations tend to have few resources to export to rich countries. However,
corporations can buy these raw materials cheaply and then process and sell them in richer nations. As a result, the
profits tend to bypass the poor countries. Poor countries are also more likely to lack industrial capacity, so they
have to import expensive manufactured goods from richer nations. All of these unequal trade patterns lead to poor
nations owing lots of money to richer nations and creating debt that makes it hard to invest in their own development.
In sum, under dependency theory, the problem is not that there is a lack of global wealth; it is that we do not
distribute it well.

Critics argue that the world economy is not a zero-sum game-one country getting richer does not mean other
countries are getting poorer. Innovation and technological growth can spill over to other countries, improving all
nations' well-being and not just the rich.

In direct contrast to what dependency theory predicts, most evidence suggests that, nowadays, foreign investment
by richer nations helps and do not hurt poorer countries.

Dependency theory is also very narrowly focused. It points the finger at the capitalist market system as the sole
cause of stratification, ignoring the role of things like how culture and political regimes play in impoverishing
countries..

By learning about economic globalization, we are be able to know about the issues and debates about it. We are
also able to think critically about solutions to the various problems brought by globalization.