Modified Module Unit 1
Modified Module Unit 1
The Structures of
UNIT 1
Globalization
INTRODUCTION
In this unit, you will learn about the different structures globalization that
includes global economy, market integration, global interstate system and
contemporary global governance. The focus of this unit will be related to
economics and politics.
Before, people can live as long as they satisfy their needs. Simple living is a
virtue to them. Today, the lives of the people become complex. Having a
simple living is already a threat to people because of many existing demands
that need to be satisfied. Considering their demands, these will push them to
be competitive in order for them to survive. People don’t just look into the
products that were produced by their country but also they are very
particular with the label of the products that they are buying, as most of us
coined the term “state sides” which means it is made from other countries.
See how globalization affects the perception of the people.
LEARNING OUTCOMES
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Globalization Capitalist
Economy Trade
World economy
Learning Objectives:
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PRESENTATION OF CONTENT
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APPLICATION
FEEDBACK
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REFERENCES
Manfred Steger, Paul Battersby, and Joseph M. Siracusa, eds. 2014. The Sage
handbook of Globalization. Two Vols. Thousand Oaks: SAGE
Learning Objectives:
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PRESENTATION OF CONTENT
Beyond the bright side of so-called mental and immaterial labor, one
discovers its seamier counterpart - the production of the actual material
infrastructure for new media. In this space, rather than illustrating how
indigenized media and information technologies contribute to cultural
diversity and human freedom, the TNMC environments that localize flexible
production appear as nothing less than crasser exploitation maximizing
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corporate control over labor. The production of media and their content are
not “merely a simple reflection of the controlling interests of those who own or
even control the broad range of capital plant and equipment which make
up the means by which cultural goods are made and distributed. Within the
media are men and women working within a range of codes and
professional ideologies, and with an array of aspirations, both personal and
social. The ambitions can be idealized; much cultural productionis routine,
mundane, and highly predictable” (Golding & Murdoch, 1991, p.25-26). The
autonomy and creative contribution of these workers is curtailed within
transnational production structures that prescribe who does what and who
makes decisions on what will be done.
The TNMCs are constantly on the lookout for creative initiatives that can be
herded into their own cultural hegemony, while willing academics and
entrepreneurs eagerly line up for the chance to join the ranks of profiteers.
The transnational production regime, Internet and all, keeps the average
consumer blogger on the margins.
For countries and firms that depend on outsourcing for income, their chief
asset is low paid skilled labor, their chief benefit is access to the techniques
and norms of TNMC production. Ultimately, the cultural hegemony of
transnational media is the economic and political reward obtained from
rapacious free market policies that encourage individual entrepreneuralism
and undermine social solidarity among workers on all levels by temporarily
but repeatedly subcontracting abroad will smaller independent studios and
employing workers in different countries.
According to the IMF, the global per capita GDP rose over five-fold in the
second half of the 20th century. It was this growth that created the large
Asian economies like Japan, China, Korea, Hong Kong, and Singapore. And
yet, economic globalization remains an uneven process, with some countries,
corporations, and individuals benefiting a lot more than others.
One of the famous works that captures the socio-historical and economic
nexus of pre-capitalist economies and the present world was that of
Immanuel Wallerstein’s research on the modern world system.
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His analysis focused on the broad economic entity with a division of labor
that is not circumscribed by political or cultural boundaries. His idea of the
world system is larger than workers, classes, or even states. Through the global
economic activity, countries around the world have been divided according
to their economic power in the global arena.
It should be noted that the world-systems have existed before and not a
unique feature of the contemporary world. What is significant is the
transformation of this world-system. In the past, the system that binds the
world together is based on political and military domination. This was the
world empire.
Not all countries or areas are equal in the modern world-system according to
Wallerstein. A three-level hierarchy is a remarkable feature of the modern
capitalist world-economy.
Based on the Wallerstein’s World System Theory Model, the world is now
divided into three categories and thereby creating the worldwide division of
labor. These are:
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a. Core – These are areas that dominate the capitalist world-economy and
exploit the rest of the system (e.g., US, Japan and Germany). This means that
the core regions benefited the most from the capitalist world economy.
b. Periphery – These are areas that provide raw materials to the core and are
heavily exploited (e.g., many countries in African region, Eastern Europe
(especially Poland) and Latin America). These areas lacked strong central
governments or were controlled by other states, exported raw materials to
the core, and relied on coercive labor practices. The core expropriated
much of the capital surplus generated by the periphery through unequal
trade relations.
c. Semi-periphery – It is a residual category that encompasses a set of regions
somewhere between exploiting and the exploited (e.g., India, China,
Indonesia, Mexico, Iran and Brazil). They often also served as buffers between
the core and the peripheries.
Why are countries being pulled toward this system? Can the countries or
areas of the world “resist” being part of it? Ritzer (2010-310) explained:
“The pressure for incorporation into the world-economy comes not from the
nations being incorporated but rather from the need of the worldeconomy to
expand its boundaries, a need which was itself the outcome of pressures
internal to the world economy” (Wallerstein 1989:129).
APPLICATION
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FEEDBACK
REFERENCES
Claudio, L.E., Abinales, P.N. (2018). The Contemporary World (pp. 12-25). 839
EDSA, South Triangle, Quezon City: C & E Publishing, Inc.
[Link]
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Unit 1: The Structures of Globalization
Learning Objectives:
PRESENTATION OF CONTENT
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If the price of banana in West Germany was higher, sellers of banana would
move from the east to the west and prices would equalize. The price of
banana in Germany and in Portugal might be different, though, and high
transport costs and other kinds of expenses might mean that it would be
uneconomical for Portuguese sellers to move their stocks to France if prices
were higher there. In distinct markets the price of the same good can be
different for long periods of time.
After World War II, the Bretton Woods system was established. In fact, the
agreement to create a new international monetary system was negotiated
among the allied powers even before the end of WW2, leading to the
Bretton Woods Agreement in 1944. Bretton Woods is the name of a small
tourist spot in the mountains of New Hampshire, USA. There, the delegates
gathered to design a new global economic system. Their most important
goal was to prevent each country from pursuing selfish policies, such as
competitive devaluation, protectionism and forming trade blocks, which
damaged the world economy in the 1930s.
The British delegation was headed by John M. Keynes, the famous economist,
while Harry D. White of the US Treasury Department represented the
American side. As a dominant military and economic power, the US took the
leadership away from Britain. Because the United States at the time
accounted for over half of the world's manufacturing capacity and held
most of the world's gold, the leaders decided to tie world currencies to the
dollar, which, in turn, they agreed should be convertible into gold at $35 per
ounce.
Under the Bretton Woods system, central banks of countries other than the
United States were given the task of maintaining fixed exchange rates
between their currencies and the dollar. They did this by intervening in foreign
exchange markets. If a country's currency was too high relative to the dollar,
its central bank would sell its currency in exchange for dollars, driving down
the value of its currency. Conversely, if the value of a country's money was
too low, the country would buy its own currency, thereby driving up the price.
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First, it was a US dollar-based system. Officially, the Bretton Woods system was
a gold-based system which treated all countries symmetrically, and the IMF
was charged with the responsibility to manage this system.
By contrast, all other countries had the obligation to intervene in the currency
market to fix their exchange rates against the US dollar.
Second, it was an adjustable peg system. This means that exchange rates
were normally fixed but permitted to be adjusted infrequently under certain
conditions. As a consequence, exchange rates were supposed to move in a
stepwise fashion. This was an arrangement to combine exchange rate
stability and flexibility, while avoiding mutually destructive devaluation.
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In reality, exchange rate adjustments were implemented far less often than
the builders of the Bretton Woods system imagined. Germany revalued twice,
the UK devalued once, and France devalued twice. Japan and Italy did not
revise their parities.
Third, capital control was tight. This was a big difference from the Classical
Gold Standard of 1879-1914, when there was free capital mobility. Although
the US and Germany had relatively less capitalaccount regulations, other
countries imposed severe exchange controls.
Stability in tradable prices (wholesale prices or WPI) from the mid 1950s to the
late 1960s was almost perfect and globally common. This macroeconomic
achievement was historically unprecedented.
The WTO has many roles: It operates a global system of trade rules, acts as a
forum for negotiating trade agreements, settles trade disputes between its
members and it supports the needs of developing countries.
The WTO comes to focus more on non-tariff related barriers to trade. One
example is the differences between nations in relation to regulations on such
items as manufactured goods or food. A given nation can be taken to task
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for such regulations if they are deemed to be an unfair restraint on the trade
in such items.
Overall, WTO operations are premised on the neoliberal idea that all nations
benefit from free trade and open trade and it is dedicated to reducing and
ultimately eliminating barriers to such trade.
The International Monetary Fund (IMF) was created on 1945 which is based in
Washington, D.C. It is governed by and accountable to the 189 countries that
make up its near-global membership.
With its near-global membership of 189 countries, the IMF is uniquely placed
to help member governments take advantage of the opportunities and
manage the challenges posed by globalization and economic development
more generally. The IMF tracks global economic trends and performance,
alerts its member countries when it sees problems on the horizon, provides a
forum for policy dialogue, and passes on know-how to governments on how
to tackle economic difficulties.
The IMF focuses on the functioning of the international monetary system, and
on promoting sound macroeconomic policies as a precondition for sustained
economic growth. The IMF provides policy advice and financing to members
in economic difficulties and also works with developing nations to help them
achieve macroeconomic stability and reduce poverty.
The IMF could give adjustment loans to nations in disequilibrium so that they
are able to meet their international obligations. The fund was created on the
basis of quotas for member nations.
The World Bank, officially the International Bank for Reconstruction and
Development (BRD) is the most important element of the World Bank Group
(WBG) (Gilbert and Vines 2000; Bradlow 2007:1262-7).
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The Bank was set up in 1944 as the International Bank for Reconstruction and
Development to act as facilitator of post-World War II reconstruction and
development. The number of member countries increased sharply in the
1950s and 1960s, when many countries became independent nations. It was
created to help restore and sustain the benefits of global integration, by
promoting international economic cooperation. All support to a borrowing
country is guided by a single strategy (called the 'Country Assistance
Strategy') that the country itself designs with help from the World Bank and
many other donors, aid groups, and civil society organizations.
The goal of the World Bank is to reduce poverty and to improve the living
standards of the people in low and middle-income countries.
The World Bank is one of the world’s largest sources of funding and
knowledge to support governments of member countries in their efforts to
invest in schools and health centers, provide water and electricity, fight
disease and protect the environment. This support is provided through project
or policy-based loans and grants, as well as technical assistance like advice
and studies. The World Bank is not a ‘bank’ in the common sense.
APPLICATION
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FEEDBACK
REFERENCES
Claudio, L.E., Abinales, P.N. (2018). The Contemporary World (pp. 12-25). 839
EDSA, South Triangle, Quezon City: C & E Publishing, Inc.
[Link]
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Learning Objectives:
PRESENTATION OF CONTENT
Many people are confused when the word state is mentioned. Some of them
will relate it to a nation. Although many people think they are the same, the
words nation and state are entirely different from one another. In terms of
territory, a state is comprised of four elements: government, territory,
population, and sovereignty. If one element is absent, it disqualifies the area
from being called a state. However, a nation can be defined as a population
who shares a similar culture and ideals. A nation is formed as a result of a
common race, religion, language, territory, history, culture or political
aspirations. These elements are not essential and are ever-changing. In terms
of political and social organization, state is a political term and refers to an
area that is organized for the security of people. It is a legal entity with human
actions. On the contrary, a nation tends to focus less on the people’s physical
needs and more on metaphorical or emotional terms.
A state has police power and individuals who disobey are punished. A state is
a political organization and it orders, coerces and punishes. On the other
hand, a nation doesn't possess strong powers.
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He placed a premium on economic equality; he did not divide the world into
countries but into classes. He referred to the capitalist class or bourgeoisie as
the owners of the factories, companies, and other means of production. In
contrast the proletariat class included those who did not own the means of
production, but instead, worked for the capitalists. In connection to this, there
is a power struggle between the capitalists class or bourgeoisie and the
proletariat. Due to exploitation, at the peak of capitalism, the proletariat will
rise to have a bloody revolution.
Marx and his co-author Fried Engels, believed that in a socialist revolution
seeking to overthrow the state and alter the economy, the proletariat “had
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Of growing significance in the realm of global civil society is the wide range
of organizations dealing primarily with issues that relate to the environment,
human rights, and economic development. Among the most notable of
these are INGOS, CARE International, Worldwide Fund for Nature,
Greenpeace and Amnesty International.
INGOS are often grassroots organizations and therefore are much more in
touch with the needs and interests of their membership than larger, more
formal, and more bureaucratized organizations associated with nation-states
or the international community.
CARE International
CARE International is a global force and partner of choice within a world-
wide movement dedicated to ending poverty. It is known everywhere for its
unshakable commitment to the dignity of people.
It works with the world’s poorest and least developed countries, fragile states,
where the government and institutions are unable to provide for the basic
needs, or protect the rights, of the majority of the people, countries affected
by conflict, crises or natural disasters, poor communities in ‘middle income
countries’ – countries which are experiencing economic growth, but where
inequality means that many people are left behind, and remain trapped in
extreme poverty.
WWF works with its partners worldwide to develop and implement lasting
solutions to the environmental challenges we face and in order to achieve
this mission, WWF focuses its efforts on two broad areas:
Biodiversity to ensure that the earth's web of life - biodiversity - stays healthy
and vibrant for generations to come.
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Greenpeace
Amnesty International
APPLICATION
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FEEDBACK
NATION STATE
REFERENCES
Claudio, L.E., Abinales, P.N. (2018). The Contemporary World (pp. 26-37). 839
EDSA, South Triangle, Quezon City: C & E Publishing, Inc.
[Link]
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Learning Objectives:
PRESENTATION OF CONTENT
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that worried about another global war began to push for the formation of a
more lasting international league. The result was the creation of UN. Although
the organization is far from perfect, it should be emphasized that it has so far
achieved its primary goal of averting another global war.
The UN is divided into five active organs. The General Assembly (GA) is UN’s
main deliberative policy making and representative organ. According to the
UN charter, “Decisions on important questions, such as those on peace and
security, admission of new members, and budgetary matters, require a two-
thirds majority of the General Assembly. Decisions on other questions are
done by simple majority. Annually, the General Assembly elects a GA
President to serve a one-year term of office.” All member states (currently at
193) have seats in the GA. The Philippines played a prominent role in the GA’s
early years when Filipino diplomat Carlos P. Romulo was elected GA President
from 1949-1950.
The SC takes the lead in determining the existence of a threat to the peace
or an act of aggression. It calls upon the parties to a dispute to settle the act
by peaceful means and recommends methods of adjustment or terms of
settlement. In some cases, it can resort to imposing sanctions or even
authorizing the use of force to maintain or restore international peace and
security. Because of these powers, states that seek to intervene militarily in
another state need to obtain the approval of the SC. With the SC’s approval,
a military intervention may be deemed legal. This is an immense power.
The third UN organ is the Economic and Social Council (ECOSOC), which is
the principal body for coordination, policy review, policy dialogue, and
recommendations on social and environmental issues, as well as the
implementation of internationally agreed development goals. It has 54
members elected for three-year terms. Currently, it is the UN’s central
platform for discussions on sustainable development.
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The court as such, cannot try individuals (international criminal cases are
heard by the International Criminal Court, which is independent of the UN),
and its decisions are only binding when states have explicitly agreed to place
themselves before the court’s authority.
Given the scope of the UN’s activities, it naturally faces numerous challenges.
Chief among these are the limits placed upon its various organs and
programs by the need to respect state sovereignty. The UN is not a world
government, and it functions primarily because of voluntary cooperation
from states. If states refuse to cooperate, the influence of UN can be severely
circumscribed.
For example, the UN Council on Human Rights can send special rapporteurs
to countries where alleged human rights violation is occurring. If a country
does not invite the rapporteur or places conditions on his/her activities,
however, this information-gathering mechanism usually fails to achieve its
goals.
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APPLICATION
In 5-7 sentences, discuss the important role of the United Nations and its way
to the realization of its role.
FEEDBACK
1. The GA is the most representative organization in the UN, but why does the
Security Council (SC) is considered to be the most powerful organ in the UN?
4. Do you think United Nations can intervene with President Duterte’s war on
drugs?
REFERENCES
Claudio, L.E., Abinales, P.N. (2018). The Contemporary World (pp. 39-47). 839
EDSA, South Triangle, Quezon City: C & E Publishing, Inc.
[Link]
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