Globalization
What is Globalization?
Term globalization is used to describe the worldwide exchange of money, goods, and
services as well as the socio-cultural changes that occur with increasing trade and
human contact
The entanglement of diverse cultures and economies
Responsible for severing social arrangements based on geographic location as a result of
accelerating transnational flows of people, images, and information
Continuation of international economic integration that began with European colonial
expansion
The Origins of Globalization
According to Abu-Lughod, an international trading economy existed between Western
Europe and China more than 700 years ago
Wallerstein argues that since early empires spent most of their resources on supporting
a large military, they simply cannot afford to become global empires
True economic integration became possible with only emergence of capitalism
o Colonization
The political, economic, and cultural domination of countries in Asia,
Africa, and the Americas by European countries starting in the
sixteenth century
Starting in sixteenth century, Western European nations developed economic systems
that were based on the market principles, whereby goods and services were produced and
exchanged for profit
The shift in land ownership during the time was one of the primary inspirations behind
the emergence of capitalism
Many Europeans began colonizing the America, Africa, and Asia to feed the growing
desire for foreign goods
Globalization today is a rather recent phenomenon
Giddens points that globalization today and different than it was back than in 1970
Back before 1970, national economies were defines by the exchange of goods, where
much of economy today is in the service sector and the knowledge of the economy
Giddens argues “we live in a world of transformation, affecting almost every aspect of
what we do
Globalization Today Economies today are more independent and integrated
The result of integration is that the power of individual nation-states to determine
their own economic, political, and cultural destinies is declining
Advances in communication technology has made the world a small place
Global development has created vast chasm between rich and poor
Defining Global Stratification
Stratification occurs when the society organizes people into a hierarchical system
according to their social class- countries can also be places in a global ranking system
Global order is defined according to the countries’ wealth or poverty
“First Word” is to buy into the assumption that it is the best, it has finished first, and it
has the gold standard
Second World is used to describe the countries of the former Soviet Union
o Command economy
An economy in which the state, rather than the market forces, manages
the production and distribution of goods
In Parag Khanna book “The Second World: Empires and Influence in the New Global
Order” suggests that the role of these countries will become increasing important in
the coming years
Rich industrialized countries traditionally have been referred to as being developed,
while poor countries have been called undeveloped, underdeveloped, or developing
o Developed countries
Wealthy, industrialized countries
o Undeveloped countries
Countries with poor economies; problematically implies a lack
of economic talent or exposure
o Underdeveloped countries
Countries that have yet to industrialize, or that have been
intentionally restricted in their development by developed
nations
o Developing countries
Countries considered to be on the road to industrialization
Sociologists will generally prefer the terms Global North rather than First World, and
Global South rather than Third World
The principle is that most economic prosperity has occurred in the Northern
Hemisphere and the most economic hardship has occurred in the Southern
Hemisphere Global North
o Global North
Weathly industrialized countries in the northern hemisphere
(previously referred to as the First World
Includes countries such as Western Europe, Canada, United States, Australia, and
Japan
As a rule, states in the Global North are democratic and technologically
advanced, have a high standard of living, and experience very low population growth
Have access to health care and clean water, and exist within stable political
structures
Colonization allowed countries in the Global North to dominate and alter the
existing economic, political, and cultural structures in their colonies for their own gain
Global South
Poor countries in the southern hemisphere (previously referred to as the Third
World)
Include poor countries such as Asia, South America, and Africa
Countries attempted to achieve development and prosperity through a third
method- one between capitalism and socialism
Colonialism and globalization constructed dependence as a way of achieving the
Global North’s own ends
Are less powerful, both economically and politically, than Global North
o Newly industrialized countries (NICS)
Poor countries that are beginning to industrialize eg. India,
Asia, and Latin America
Brazil and Mexico are considered NICs
Factors Contributing to Globalization
Technological Change
Technological innovations have accelerated globalization which have enables worldwide
trade
Most important worldwide trades is container shipping
While shipping was important for transporting goods, the emergence of cost-effective
worldwide air travel was instrumental in promoting social and cultural change
Political Change
Collapse of Soviet Union influenced the rapid pace of globalization After collapse only capitalism and dem0cracy were the only viable economic and
political options for participating on the world stage
Giddens argues that the Soviet Union “with its emphasis upon state-run enterprise
and heavy industry could not compete in the global electronic economy”
Griswold claims that globalization enhances spread of capitalism and also speads the
Western ideal of democracy
Economic Change
Most commonly associated with the rise of globalization of expanding trade and
the emergence of international banking
International Monetary Fund
Was established to promote international monetary stability to foster economic
growth and to provide temporary financial assistance to poor countries
Built on the premise that for economies to prosper, barriers to trade must be
removed through privatization, deregulation, lowered tariffs, and economic
liberalization
Some argue that IMF was never intended to act as a vehicle to promote global
economic integration but instead as a tool for the West to maintain its economic
and political dominance over the rest of the world
Can exert tremendous pressure on the recipient countries to adopt its formula
for economic reform
Can control the spending decisions of poor countries, and in doing so promote its
own i
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