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Lecture 10 and 11 Notes - Globalization and Global Environment Complete analysis of these 2 topics covered. In-depth summaries with good examples!!!!!

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Barry Mc Clinchey
Study Guide

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Globalization and Poverty
December 1, 2010
Poverty is defined as:
Absolute poverty/ Object People are living in a state where there’s a failure to provide basic
needs of life; water, food, etc.
Low income cutoff Arbitrary amount of yearly income that if you fall below that you can’t
obtain basic necessities of life.
Relative Poverty People perceive that they don’t have what they think they deserve to have
in a society. These terms are used to measure a degree of society in regards to poverty.
Market Basket Approach Generates an imaginary collection of goods and services that
government put together to determine what it takes to live healthy in a community.
One way to address poverty is for wealthy to give people that don’t have anything whatever they
need. Ex. Rich countries to give poor countries money. Many theorists don’t agree
Trickle-Down theory
- Stop giving people money. We should do something much bigger. Spend less time focusing on
people who are down and out, and concentrate on stimulating economic growth that would
benefit everybody. Governments in the United States have followed this approach. Corporations
must be healthy and strong. More of a philosophical and political approach.
World Bank encourages this approach and International Monetary Fund: They argue that
poverty is declining.
Globalization and Inequality
- Out global society is characterized by countries with good standards of living and economy. In
Europe, Germany is very strong. Most EU countries are struggling and looking at Germany for
- The income of the world’s richest 50 people combines are greater than incomes of poorest 416
million combined.
Gross Domestic Product (GDP)
- Each person’s share of the countries economic activity. Population of country divided by assets.
- A way of looking at a measurement as equal because same measurement is used to calculate
each country.
Foreign Aid
- Global North is assumed to be a collection of countries that run things. Ex. Corporations.
Standards of living are high. Global north give money and help to global south.
- Global South: Countries that are disadvantaged.
- 2007, 22 member countries of the OECD provided $103.65 billion in assistance.
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- Both Canada and the US fall short of the UN target that are set for foreign aid because people
believe strengthening a country’s economy is a better plan (They follow trickle-down theory).
Theoretical approaches to globalization
Modernization Theory
- Came about after WW2. The older theories that tried to explain how economy worked became
- Basically says that Canada the US, Great Britain, countries that are booming in economies, high
technology, the poor countries will see this and want to be just like them. There are a lot of
countries that haven’t reached this goal; causes pressure to succeed.
- Theory states that this would lead to global prosperity around the world.
- Modernization is inevitable, irreversible and linear (progress there no matter what).
- Promotes use of foreign capital to jump-start process of industrialization.
- Foreign investment produces prosperity when things are going well and vice-versa.
- Advocates diffusion of Western Values.
- Eurocentric Ethnocentric (our way makes more sense and will be prosperous).
Dependency Theory
- Popular theories in late 1980s.
- Argues that places where there’s under-development, there is an inevitable outcome of long-
term inequality because there are advanced and less advanced nations in the world.
- Gunder Frank argues, “This kind of Dependency is inevitable”
- Depends on huge capital investments from other countries.
- Argument of Frank is that Globalization created poverty; corporate capital creates poverty.
- Grounded on exploitation (Marx’s theory).
- *Exploitation = Dependency theory.
- *Colonialism created lasting dependency on certain parts of the world on other parts of the
- All these cause poverty (Global South).
- Western capitalist development perpetuates in global south
Worlds Systems Theory
- Various centers of economic and capitalist activities around the world. EX. NYC has strong
influence and these big economic HUBS of the world influence other countries.
- All other societies are dependant and linked to these core centers. Economic and Political link is
the Stock Market.
- Shifts focus away from dependant relationships toward investigation of the economic and
political hierarchy that link all economies to global system.
- Corporate interests run the world; countries and politicians are irrelevant.
- Core, periphery, and semi-periphery (Global South).
- Capitalist creates global inequalities based on the domination of Global South.
Homogenization of Cultures
- Many argue that this trend is dominated by Western media cultures, clothing, etc. We’re seeing
less cultural diversity around the world.
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