Name:_______________________ Course&Yr.

______________ Subject: Contemporary World

Teacher: Arnel G. Boholst Contact No. 09555585599 Email: [email protected]
MODULE 1
Unit 1 – INTRODUCTION TO GLOBALIZATION

“Let me begin with globalization. [...] Narrowly defined, it is meant to mean the instant movement of
capital and the rapid distribution of data and products operating within a politically neutral environment shaped
by multinational corporate demands. Its larger connotations, however, are less innocent, encompassing as they
do not only the demonization of embargoed states or the trivialization cum negotiation with warlords, but also
the collapse of nation-states under the weight of transnational economies, capital, and labor; the preeminence
of Western culture and economy; the Americanization of the developed and developing world through the
penetration of US culture into others as well as the marketing of third-world cultures to the West as fashion, film
setting, and cuisine… Its disregard of borders, national infrastructures, local bureaucracies, internet censors,
tariffs, laws, and languages; its disregard of margins and the marginal people who live there; its formidable,
engulfing properties accelerating erasure, a flattening out of difference, of specificity for marketing purposes. An
abhorrence of diversity. We imagine indistinguishability, the elimination of minority languages, minority cultures
in its Wake. We speculate with horror on what could be the irrevocable, enfeebling alteration of major
languages, major cultures in its sweep. Even if those dreaded consequences are not made completely manifest,
they nevertheless cancel out globalism's assurances of a better life by issuing dire warnings of premature cultural
death.”
— Toni Morrison
“One day there will be no borders, no boundaries, no flags and no countries and the only passport will
be the heart.”
— Carlos Santana
The most important challenges facing the world in the 21st century are associated with globalization, the growing
interconnectedness of people and places through converging processes of economic, political, and cultural change. Once
distant regions are now increasingly linked together through commerce, communication, and travel.
This unit introduces the various definitions of globalization, understand its key features, and familiarize you to a variety
of factors which have contributed to the process of globalization, its benefits and disadvantages, and its history and
theories.

Lesson 1: Globalization
 In This Lesson

 Develop a nuanced definition of globalization in order to begin to understand the

processes of globalization.
 View a video and develop their own definition of globalization.
 Understand the key features of globalization.
 Identify the pros and cons of globalization.

The Meaning of Globalization

“Globalization” is a catchphrase familiar to anyone tuned in to social media. Every day we hear the term
globalization on the news, read it in the papers, and overhear people talking about it. What does this term
mean? There is no definite definition of globalization or globalisation and the term is used to denote a variety of
ways in which nation-states, regions and people, due to advances in transportation and communication systems,
are becoming more and more closely connected and interdependent, not only in the economic sense, but also in
the cultural, political, social, technological, environmental and spatial aspects.

Shalmali Guttal (2007) defined globalization as “the process of interaction and integration among people,
companies, and governments worldwide. As a complex and multifaceted phenomenon, globalization is
considered by some as a form of capitalist expansion which entails the integration of local and national
economies into a global, unregulated market economy.”
Below are further definitions of globalization:

[Globalization] is “the geographic dispersion of industrial and service activities, for example research and
development, sourcing of inputs, production and distribution, and the cross-border networking of companies,
for example through joint ventures and the sharing of assets.”
– Organization for Economic Cooperation and Development
[Globalization] is “the word used to describe the growing interdependence of the world’s economies,
cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of
investment, people, and information.” – Peterson Institute for International Economics
[Globalization] is “the ability to produce any good or service anywhere in the world, using raw materials,
components, capital and technology from anywhere, sell the resulting output anywhere and place the profits
anywhere.” – Peter Jay
[Globalization] is “the increased interconnectedness and interdependence of peoples and countries, is
generally understood to include two inter-related elements: the opening of international borders to increasingly
fast flows of goods, services, finance, people and ideas; and the changes in institutions and policies at national
and international levels that facilitate or promote such flows. Globalization has the potential for both positive
and negative effects on development and health.” – World Health Organization
[Globalization] is “the inexorable integration of markets, nation-states, and technologies to a degree
never witnessed before – in a way that is enabling individuals, corporations and nation-states to reach around
the world farther, faster, deeper, and cheaper than ever before and in a way that is enabling the world to reach
into individuals, corporations, and nation-states farther, faster, deeper, and cheaper than ever before.” –
Thomas Friedman
[Globalization] is “the process of greater interdependence among countries and their citizens. It consists
of increased integration of product and resource markets across nations via trade, immigration, and foreign
investment – that is, via international flows of goods and services, of people, and of investment such as culture
and the environment. Simply put, globalization is political, technological, and cultural, as well as economic.” –
Robert J. Carbaugh
[Globalization] is “… a process in which geographic distance becomes less a factor in the establishment
and sustenance of border-crossing, long distance economic, political, and socio- economic relations. People
become aware of this fact. Networks of relations and dependencies therefore become potentially border-
crossing and worldwide. This potential internationalization of relations and dependencies causes fear, resistance,
actions, and reactions.” – Rudd Lubbers
[Globalization] can thus be defined as “the intensification of worldwide social relations which link distant
localities in such a way that local happenings are shaped by events occurring many miles away and vice-versa.
This is a dialectical process because such local happenings may move in an obverse direction from the very
distanciated relations that shape them. Local transformation is as much part of globalization as the lateral
extension of social connections across time and space.” – Anthony Giddens
Converging Currents of Globalization
Most scholars agree that the most significant components of globalization is the economic
reorganization of the world. The characteristics of this new world arrangement are:
1. Global communication systems that link all regions of the planet instantaneously and global transportation
systems capable of moving goods quickly by air, sea, and land;
2. Transnational conglomerate corporate strategies that have created global corporations more economically
 powerful than many nation-states;
3. International financial institutions that make possible 24-hour trading with new and more- flexible forms of
monetary flow;
4. Global agreements that promote free trade;
5. Market economies that have replaced state-controlled economies, and privatized firms and services, like
water delivery, formerly operated by governments;
6. An abundance of planetary goods and services that have arisen to fulfill consumer demand (real or
imaginary); and, of course,
7. An army of international workers, managers, executives, who give this powerful economic force a human
dimension. (Rowntree, Lewis, Price & Wyckoff, 2008)
Factors That Have Contributed to Globalization
There are a variety of factors which have contributed to the process of globalization.
Some of the most important globalization drivers are numbered below.
1. The price of transporting goods has fallen significantly, enabling good to be imported and exported more
cheaply due to containerization and bulk shipping;
2. The development of the internet to organize trade on a global scale;
3. TNCs have taken advantage of the reduction or lowering of trade barriers;
4. The desire of TNCs to profit from lower unit labor costs and other favorable production factors abroad has
encouraged countries to regulate their tax systems to draw in foreign direct investment (FDI);
Transnational and multinational companies have invested significantly in expanding internationally;
5. The collapse of communism in the Soviet Union; and
6. The opening of China to world trade.
Advocates and Critics of Globalization
Globalization is one of the most controversial issues of our times. Supporters generally believe that it
brings in greater economic efficiency that will eventually result in bring prosperity for the entire world. Critics
think that it will largely benefit those who are already rich, leaving most of the world poorer than before.
Economic globalization is generally applauded by corporate leaders and economists. But opposition to economic
globalization is widespread in the labor and environmental movements for it has promoted exploitation of
workers, children, farmers, and the environment.

Advantages of Globalization Disadvantages of Globalization

 Productivity increases faster when  Millions of workers have lost their jobs
countries produce goods and services in because of imports or shifts in
which they have a comparative production abroad. Most find new jobs
advantage. Living standards can increase that pay less.
more rapidly.
 Global competition and cheap imports  Millions of workers fear getting laid off,
keep a constraint on prices, so inflation is especially at those firms in import-
less likely to disrupt economic growth. competing industries.

 An open economy promotes technological 

Workers face demands of wage
development and innovation, with fresh concessions from their employers,
ideas from abroad. which often threaten to export jobs
abroad if wage concessions are not
accepted.
 Jobs in export industries tend to pay about  Besides blue-collar jobs, service and
15 percent more than jobs in import- white-collar jobs are increasingly
competing industries. vulnerable to operations being sent
overseas.
 Unfettered capital movements provide  Workers can lose their competitiveness
workers access to foreign investment and when companies build state-of-the-art
maintain low interest rates. factories in low wage countries, making
them as productive as those in the
developed countries.
(Business Week “Backlash Behind the Anxiety over Globalization,” 2000)
A number of experts argue that both the anti-globalization and the pro-globalization stances are exaggerated. Those in
the middle ground tend to argue that economic globalization is indeed unavoidable. They point out that even the anti-
globalization movement is made possible by the Internet and is, therefore, itself an expression of globalization. They
further contend that globalization can be managed, at both the national and international levels, to reduce economic
inequalities and protect the natural environment. Such scholars stress the need for strong yet efficient governments and
international institutions (such as the UN, World Bank, and IMF), along with networks of watchdog environmental, labor,
and human rights groups. (Rowntree, Lewis, Price & Wyckoff, 2008)
Lesson 2: History/Theories of Globalization
 In This Lesson

 Discuss the periodization of globalization by considering when globalization began.

 Compare and contrast the three waves of globalization.
 Differentiate the competing theories of globalization.

Globalization is not a new phenomenon because there have been many instances in the periods in
history when there were contacts between diverse individuals and countries. However, the pace of globalization
has accelerated significantly over the last three decades. To know more about the history/theories of
globalization, read the ensuing articles in this lesson.

A Brief History of Globalization from World Economic

Forum by Peter Vanham

When Chinese e-commerce giant Alibaba in 2018 announced it had chosen the ancient city of Xi’an as
the site for its new regional headquarters, the symbolic value wasn’t lost on the company: it had brought
globalization to its ancient birthplace, the start of the old Silk Road. It named its new offices aptly: “ Silk Road
Headquarters”. The city where globalization had started more than 2,000 years ago would also have a stake in
globalization’s future.
Alibaba shouldn’t be alone in looking back. As we are entering a new, digital-driven era of globalization –
we call it “Globalization 4.0” – it is worthwhile that we do the same. When did globalization start? What were its
major phases? And where is it headed tomorrow?

This piece also caps our series on globalization. The series was written ahead of the 2019 Annual Meeting of the
World Economic Forum in Davos, which focuses on “Globalization 4.0”. In previous pieces, we looked at some
winners and losers of economic globalization, the environmental aspect of globalization, cultural globalization and
digital globalization. Now we look back at its history. So, when did international trade start and how did it lead to

globalization?

Ancient silk roads: Silk roads (1st century BC-5th century AD, and 13th-14th centuries AD) / Image: Flickr
People have been trading goods for almost as long as they’ve been around. But as of the 1st century BC, a remarkable
phenomenon occurred. For the first time in history, luxury products from China started to appear on the other edge of
the Eurasian continent – in Rome. They got there after being hauled for thousands of miles along the Silk Road. Trade
had stopped being a local or regional affair and started to become global.
That is not to say globalization had started in earnest. Silk was mostly a luxury good, and so were the spices that
were added to the intercontinental trade between Asia and Europe. As a percentage of the total economy, the value of
these exports was tiny, and many middlemen were involved to get the goods to their destination. But global trade links
 were established, and for those involved, it was a goldmine. From purchase price to final sales price, the multiple went in

the dozens. The Silk Road could prosper in part because two great empires dominated much of the route. If trade was
interrupted, it was most often because of blockades by local enemies of Rome or China. If the Silk Road eventually closed, as
it did after several centuries, the fall of the empires had everything to do with it. And when it reopened in Marco Polo’s late
medieval time, it was because the rise of a new hegemonic empire: the Mongols. It is a pattern we’ll see throughout the
history of trade: it thrives when nations protect it, it falls when they don’t.
Arabic calligraphy in Asilah medina, Morocco: Spice routes (7th-15th centuries)

/ Image: Pierre-Yves Babelon/Shutterstock.com/Unesco

The next chapter in trade happened thanks to Islamic merchants. As the new religion spread in all directions from
its Arabian heartland in the 7th century, so did trade. The founder of Islam, the prophet Mohammed, was famously a
merchant, as was his wife Khadija. Trade was thus in the DNA of the new religion and its followers, and that showed. By the
early 9th century, Muslim traders already dominated Mediterranean and Indian Ocean trade; afterwards, they could be
found as far east as Indonesia, which over time became a Muslim-majority country, and as far west as Moorish Spain.
The main focus of Islamic trade in those Middle Ages were spices. Unlike silk, spices were traded mainly by sea since
ancient times. But by the medieval era they had become the true focus of international trade. Chief among them were
the cloves, nutmeg and mace from the fabled Spice islands – the Maluku islands in Indonesia. They were extremely
expensive and in high demand, also in Europe. But as with silk, they remained a luxury product, and trade
remained relatively low volume. Globalization still didn’t take off, but the original Belt (sea route) and Road (Silk
Road) of trade between East and West did now exist .
Age of Discovery (15th-18th centuries) / Image: BLR

Truly global trade kicked off in the Age of Discovery. It was in this era, from the end of the 15th century
onwards, that European explorers connected East and West – and accidentally discovered the Americas. Aided
by the discoveries of the so-called “Scientific Revolution” in the fields of astronomy, mechanics, physics and
shipping, the Portuguese, Spanish and later the Dutch and the English first “discovered”, then subjugated, and
finally integrated new lands in their economies.
The Age of Discovery rocked the world. The most (in)famous “discovery” is that of America by Columbus,
which all but ended pre-Colombian civilizations. But the most consequential exploration was the
circumnavigation by Magellan: it opened the door to the Spice islands, cutting out Arab and Italian middlemen.
While trade once again remained small compared to total GDP, it certainly altered people’s lives. Potatoes,
tomatoes, coffee and chocolate were introduced in Europe, and the price of spices fell steeply.
Yet economists today still don’t truly regard this era as one of true globalization. Trade certainly started to become
global, and it had even been the main reason for starting the Age of Discovery. But the resulting global economy was still
very much soloed and lopsided. The European empires set up global supply chains, but mostly with those colonies they
owned. Moreover, their colonial model was chiefly one of exploitation, including the shameful legacy of the slave trade.
The empires thus created both a mercantilist and a colonial economy, but not a truly globalized one.