GEC 103 NOTES

Chapter 3

Review Notes:

A Prior Epoch of Globalization (1896-1914):

- Between the years 1896 and 1914, a global capitalist system emerged, characterized by significant
economic integration and interconnectedness.

Similarities between Historical and Contemporary Globalization:

1. Technological Advancements:
- In the earlier epoch (late 19th to early 20th centuries), progress was driven by innovations like
the railroad (beginning in the 1830s) and steamship (18th century), while in recent years (late 20th
century onwards), the airplane and the Internet have played central roles.
- The telegraph (19th century) greatly enhanced global communication, while the Internet has
revolutionized communication and connectivity in modern times.

2. Large-Scale Capital Flows:

- Both historical and contemporary global economic development relied on significant flows of
capital across borders.
- From the late 19th century onwards, industrialization and economic expansion led to increased
capital investment globally, while modern globalization has seen the rise of multinational
corporations and financial institutions facilitating capital mobility.

3. Migration and Remittances:

- Between 1896 and 1914, large-scale immigration was a notable feature, with millions of people
migrating to countries like the United States.
- Remittances, or the sending of money back to their countries of origin, played a crucial role in
supporting families and contributing to local economies, a trend that continues today with global
migration patterns.

4. Global Economic Specialization:

- Economic specialization among nations, based on the "law" of comparative advantage, was
prevalent during both historical and contemporary periods.
- Adam Smith's "The Wealth of Nations" (1776) laid the foundation for the concept of
comparative advantage, which continues to shape global trade and specialization.

5. Emphasis on Free Trade:

- Both historical and contemporary periods emphasized free trade and the elimination of trade
barriers, such as tariffs.
- The late 19th century saw the rise of protectionist policies and trade agreements, while modern
globalization has witnessed efforts to liberalize trade through organizations like the World Trade
Organization (WTO).
Challenges and Issues:
- Despite the structural similarities between the two periods, similar problems emerged:
1. **Subjugation of Poor Nations:**
- Poor nations and their populations were marginalized by the global economy's operations,
leading to economic disparity and inequality.
2. **Unequal Distribution of Gains:**
- Not all regions and sectors benefited equally from global economic growth, exacerbating
disparities within and between nations.
3. **Impact on Social Classes:**
- Certain industries and social classes faced losses, while others benefited from economic
globalization.
4. **Debt Repayment and Poverty:**
- Poor segments of society suffered most when nations had to repay debts to more developed
countries, perpetuating cycles of poverty and dependency.

**Beyond Economic Globalization:**

- While the focus has often been on economic globalization, globalization encompasses broader
dimensions, including cultural and political aspects.
- Recognizing the multidimensional nature of globalization is essential for a comprehensive
understanding of its impacts and implications.

**Conclusion:**
- The historical epoch of globalization between 1896 and 1914 shares striking similarities with
contemporary globalization trends.
- Economic globalization is significant, but acknowledging and addressing cultural and political
dimensions are essential for a holistic understanding of globalization's effects and challenges.

**Economic Development During and After WW II:**

**Context:**
- Economic globalization post-1945 is viewed in the context of a prior epoch of economic
globalization, which collapsed due to World War I, the Great Depression, and World War II.
- Negative effects were felt by almost all major economies, with the exception of the US, which
experienced significant economic growth during and after the wars.

**Movement Towards Autarky:**

- In the 1930s, many countries, notably fascist Italy and Germany, moved towards autarky, seeking
economic self-sufficiency.
- Autarky, or inward turn of a nation, is antithetical to globalization, which requires outward-looking
engagement with other parts of the world.
- The US also leaned towards isolationism in the 1930s, although this stance was more political than
economic.
**Planning for an Open International Economy:**
- Even during WWII, Western powers, particularly the US and the UK, began planning for a more
open international economy.
- Concerns included the fear of a post-war depression and challenges in absorbing demobilized
military manpower.
- Planners aimed to prevent a recurrence of trade barriers and promote the free flow of money.
- Focus was on reducing trade barriers and creating conditions for fiscal flow to ensure economic
stability.

**The Bretton Woods Conference (July 1944):**

- A three-week meeting held at the Mount Washington Hotel in Bretton Woods, New Hampshire,
laid the foundation for the "Bretton Woods system."
- The conference aimed to establish a framework for post-war economic order and stability.
- Key objectives included reducing trade barriers, promoting financial stability, and facilitating
international monetary cooperation.

**Key Outcomes:**

1. **Bretton Woods System:**

- The conference led to the establishment of the Bretton Woods system, which included
institutions like the International Monetary Fund (IMF) and the World Bank.
- The system aimed to regulate international monetary relations and promote financial stability
through fixed exchange rates tied to the US dollar.

2. **Promotion of Free Trade:**

- Efforts were made to reduce trade barriers and promote free trade to prevent a return to
protectionism.
- Agreements were reached to facilitate the free flow of goods, services, and capital across
borders.

3. **Financial Stability:**
- Measures were implemented to promote financial stability globally, including mechanisms for
currency stabilization and exchange rate management.

**Conclusion:**
- The Bretton Woods conference marked a pivotal moment in the post-war economic order, laying
the groundwork for a more open international economy.
- By addressing concerns about trade barriers, financial stability, and economic cooperation, the
conference aimed to prevent a recurrence of the economic crises that had plagued the pre-war era.
- The Bretton Woods system would shape the trajectory of global economic development for
decades to come, setting the stage for increased international trade and financial integration.
**Bretton Woods and the Bretton Woods System:**

**Context:**
- The Depression underscored the need for cooperation among nations, as protectionist practices
and currency devaluation exacerbated economic challenges.

**Key Elements of the Bretton Woods System:**

1. **Establishment of Par Values:**

- Each participating state set a "par value" for its currency in terms of gold or the US dollar's gold
value.
- Example: The US pegged its currency at $35 per ounce of gold.

2. **Currency Exchange Agreement:**

- Nations agreed to exchange their currencies at established rates within a one percent margin,
facilitating international trade without external intervention.

3. **Creation of the IMF:**

- The International Monetary Fund (IMF) was established to stabilize exchange rates and oversee
international monetary cooperation.
- IMF members deposited gold reserves and were empowered to approve currency par values.

4. **Elimination of Currency Restrictions:**

- Member states committed to eventually eliminating all restrictions on currency use for
international trade.

5. **US Dollar as Global Currency:**

- The Bretton Woods system anchored on the US dollar, which was made convertible into other
currencies or gold at fixed par values.
- The dollar became a global currency, backed by the US's significant gold reserves and export
dominance.

**Impact of Bretton Woods:**

- **Global Trade:** Reduced trade barriers through the "unconditional most-favored-nation"
principle, promoting non-discrimination in trade concessions.
- **Monetary Order:** IMF played a central role in maintaining stable exchange rates, fostering
international trade and investment.
- **Global Investment:** World Bank aimed to support investment, but US aid through the
Marshall Plan and European recovery overshadowed its role. Multinational corporations (MNCs)
emerged as key investors, facilitating global expansion and circumventing trade barriers.
- **Social Welfare Expansion:** Bretton Woods' global openness contributed to the expansion of
social welfare programs in many countries, providing a safety net amid economic challenges.

**Overall Impact:**
- Bretton Woods oversaw rapid economic growth and enduring stability, satisfying various nations
and constituencies, including capital and labor.
- It paved the way for unprecedented international economic cooperation and integration, laying
the foundation for post-war prosperity and development.

**Economic Organizations Spawned by Bretton Woods:**

- Directly or indirectly, Bretton Woods led to the establishment of organizations such as the IMF,
World Bank, and later the WTO, shaping the trajectory of global economic governance and
cooperation.

**General Agreement on Tariffs and Trade (GATT) and its Evolution into the
WTO:**

**Formation and Operation:**

- Established in 1947 as a system for trade liberalization, evolving from the Bretton Woods
framework.
- Operated until 1995 when it was replaced by the World Trade Organization (WTO), expanding
beyond goods to include services.

**Key Features and Evolution:**

- GATT focused solely on trade in goods, while the WTO took on additional responsibilities,
including services trade.
- GATT served as a forum for country representatives, while the WTO is an independent
organization.
- Initial trade agreements were negotiated by 23 nations in 1947, leading to subsequent rounds of
negotiations under GATT's umbrella.
- Rounds included the Kennedy Round (1967) and the Tokyo Round (1979), culminating in the
Uruguay Round (1986–93), which resulted in the creation of the WTO.

**Transition to the WTO:**

- Many elements of GATT were incorporated into the WTO, adapting to changing global economic
realities.
- WTO negotiations addressed various issues, including reducing tariffs, non-tariff barriers, and
liberalizing trade in agriculture.

**Recent Focus Areas:**

- Recent WTO negotiations have addressed emerging issues like international trade in services,
trade-related intellectual property rights (TRIPS), and trade-related investment measures (TRIMS).
- TRIPS, negotiated during the Uruguay Round, focuses on intellectual property rights (IPRs),
covering a wide range of intangible products like movies, books, and software.
- Supporters argue that strong IPRs encourage investment in research and innovation, while
detractors claim they impose burdens on developing countries, hindering their development.

**Conclusion:**
- GATT's transformation into the WTO reflects the evolution of global trade governance, adapting to
new challenges and priorities.
- WTO negotiations continue to shape international trade policies, addressing emerging issues while
balancing interests between developed and developing nations.

**International Monetary Fund (IMF)**

**Goal and Functions:**

- The IMF aims to promote macroeconomic stability for member nations and the global economy.
- It deals with exchange rates, balance of payments, international capital flows, and monitors
member states' macroeconomic policies.

**Criticism and Support:**

- Critics view the IMF as favoring developed countries and imposing policies on less developed ones,
while supporters see it as vital for global economic development.

**Evolution of IMF Functions:**

- Initially focused on managing exchange rates under the Bretton Woods system.
- Shifted to maintaining stable exchange rates post-collapse of fixed exchange-rate system in the
early 1970s.
- Transitioned to providing adjustment loans to developing countries with balance-of-payments
problems, imposing stringent conditions such as austerity measures.

**Structural Adjustments and Controversies:**

- Structural adjustment programs imposed generalized models of market economies on developing
countries, leading to controversy and protests.
- IMF governance structure, dominated by Western powers, has faced criticism for lack of
representation from developing countries.

**Recent Changes and Challenges:**

- Greater focus on chronic debt sustainability problems and resolution of economic crises.
- Involvement in crises in Latin America, Asia, and Russia in the 1990s led to criticisms of IMF
policies.
- The Great Recession led to increased IMF lending and involvement in countries like Iceland and
Greece.
- Controversy over IMF loans to Greece, characterized by austerity measures and public protests,
raised questions about the Fund's long-term viability as an international lender of last resort.

**Conclusion:**
- The IMF's role has evolved over time, responding to changing global economic realities and
challenges.
- While it has played a significant role in stabilizing economies and resolving crises, it continues to
face criticism and challenges related to governance, policy conditionality, and long-term
sustainability.
**World Bank (International Bank for Reconstruction and Development - IBRD)**

**Establishment and Membership:**

- Founded in 1944 at Bretton Woods, officially known as the International Bank for Reconstruction
and Development (IBRD).
- Membership open to all IMF member states, currently comprising 189 nations.

**Mission and Functions:**

- Supports development projects and programs in middle-income and creditworthy poorer nations.
- Provides funds, advice, and analytical services to member states for various developmental
purposes.
- Initially focused on physical infrastructure projects but expanded to address a wide range of
economic development issues.

**Expanded Mandate:**
- Addresses issues beyond physical infrastructure, including education, health, environment,
governance, and poverty alleviation.
- Provides loans for governance matters such as public sector management, corruption, and legal
reform.

**Decision Making and Governance:**

- Decisions based on economic rather than political grounds, but the political dimension is
sometimes ambiguous.
- Governance structure includes a Board of Governors and a Board of Executive Directors, with
voting power reflecting member states' economic importance.
- President traditionally appointed by the President of the United States.

**Financial Resources and Lending:**

- Funding sources include contributions from member countries and borrowing through highly
rated bonds.
- Provides loans to member states at low-interest rates, with lending decisions based on repayment
capacity.

**Controversies and Criticisms:**

- Dominated by developed nations, with less representation from less developed countries and
non-state actors.
- Criticisms include favoritism toward certain interests, exacerbating poverty through neoliberal
policies, and encroachment on the activities of other agencies.
- Controversy over neglect of agriculture in sub-Saharan Africa highlighted in the 2007 World
Development Report.

**Recent Focus and Challenges:**

- Renewed focus on agriculture in developing nations, particularly in Africa, following
acknowledgment of past mistakes.
- Challenges include addressing debt levels, navigating economic issues arising from the Great
Recession, and balancing development objectives with neoliberal principles.
**The End of Bretton Woods**

**Key Event:**
- August 15, 1971: President Richard Nixon takes the United States off the gold standard, leading to
the collapse of the Bretton Woods system.

**Factors Contributing to Demise:**

1. **Preeminence of the United States:** Bretton Woods relied on the dominance of the US dollar.
However, as other economies recovered from WWII, their currencies gained importance.
2. **Emergence of Other Currencies:** Growth in importance of currencies like the Japanese yen,
the euro, and the Chinese yuan challenged the dominance of the US dollar.
3. **Restoration of International Finance:** After years of focus on national economies,
international finance regained significance, leading to shifts in global economic dynamics.
4. **Undermining of Trade Agreements:** Agreements and understandings supporting
international trade and investment came under attack.

**Challenges to Openness in Trade:**

- **Tariff Evasion:** Countries began finding ways to protect themselves from foreign competition,
such as accusing others of "dumping" products or implementing Voluntary Export Restraints (VERs).
- **Return to Protectionism:** These actions signaled a move away from the openness promoted
by GATT, potentially leading to a resurgence of protectionist measures.

**Changes in Bretton Woods-Era Organizations:**

1. **World Bank (WB)**

- Loaning large sums to countries with strong economies (e.g., China) and middle/high-income
economies like Greece, raising questions about its effectiveness.
- Critics argue that WB policies exacerbate poverty through structural adjustment programs and
aid favoring the wealthy.
- Challenges to WB's leadership structure, dominated by the US, amid declining contributions
from the US compared to other nations.

2. **International Monetary Fund (IMF)**

- Criticisms include past austerity programs imposed on poor countries, legitimizing bad policies,
and shift in global power away from traditional powers like the US and Europe.
- IMF's relevance questioned due to a growing global economy and skepticism about its necessity
in future financial crises.
- Economist Joseph E. Stiglitz's critique highlights IMF's failures in managing globalization,
promoting neoliberal policies, and lack of transparency.

**Joseph E. Stiglitz's Critique:**

1. **Globalization and Neoliberalism**

- Stiglitz critiques neoliberal economic globalization, arguing it has failed to benefit the poor and
has widened the gap between the rich and poor.
 - He points to globalization's failure in providing economic stability, citing crises in Asia, Russia,
and Latin America.

2. **IMF's Evolution**
- IMF's shift towards market supremacy and imposition of neoliberal policies like fiscal austerity
are criticized.
- Stiglitz sees IMF's failures in providing funds for economic stability and promoting sustained
growth.
- Structural adjustment programs led by IMF did not bring sustained growth and often stifled
economic growth.

3. **IMF's Errors and Blunders**

- Privatization often done hastily, leading to job losses and corruption.
- Push for liberalization of financial markets hurt small emerging countries and contributed to
financial crises.
- IMF's failure to address job creation, land reform, education, and health services worsened
economic conditions.

4. **East Asian Financial Crisis**

- Stiglitz blames IMF for exacerbating the crisis by forcing excessive austerity measures and failing
to address root causes.
- Countries like Malaysia and China that did not accept IMF intervention fared better in the short
run.

**Conclusion:**
Stiglitz emphasizes the need for reform within the IMF and other global institutions to ensure fairer
practices and a more humane approach to economic development.

**Other Important Economic Organizations:**

1. **Organization for Economic Cooperation and Development (OECD)**

- Comprises 34 developed nations and holds significant influence despite lacking formal power.
- Acts as a forum for policy discussions and coordination among member states.

2. **European Union (EU)**

- Originated from the post-WWII and Bretton Woods era, with 28 member states (soon to be 27
after the UK's departure).
- Represents the largest domestic market in the developed world, with over 512 million citizens.
- Euro Zone includes nations in Europe adopting the euro as their currency, though some nations
retain their traditional currencies.

3. **North American Free Trade Agreement (NAFTA)**

- Established on January 1, 1994, aiming to eliminate most trade and investment barriers among
the US, Canada, and Mexico over 15 years.
- Subject to scrutiny and potential changes under the presidency of Donald Trump.
4. **Free Trade Area of the Americas (FTAA)**
- Proposed expansion of NAFTA to include all American countries (except Cuba), but ultimately
failed to materialize.

5. **MERCOSUR (Southern Common Market)**

- Formed by the Treaty of Asuncion in 1991, aimed to establish a common market in South
America by 1995.

6. **Organization of the Petroleum Exporting Countries (OPEC)**

- Established in 1960 by major oil exporters to address low oil prices and inflation.
- Successful in increasing oil prices significantly, benefiting member nations economically.

7. **Trans-Pacific Partnership (TPP)**

- Involves 11 countries aiming to deepen economic ties and expand trade, initially covering 40% of
global trade.
- Withdrawal of the United States under President Trump's administration raised concerns about
its future.
- Criticisms include secret negotiations, potential threats to labor forces, and provisions allowing
companies to sue governments over policy changes.

Overall, these organizations play crucial roles in shaping global economic policies, facilitating trade,
and addressing various economic challenges and opportunities. Their effectiveness and impacts are
subject to ongoing debates and critiques, reflecting the complexities of global economic
governance.

**The Role of Emerging Economies**

**Introduction to Emerging Economies (2012):**

- **Definition:** Emerging economies, also known as newly industrializing economies, denote less
developed countries undergoing rapid industrialization and economic growth.
- **Examples:** Notable examples include Mexico, Brazil, Chile, Russia, China, India, and Vietnam,
which actively engage in global economic institutions and free trade agreements.
- **Key Points:** No specific dates are mentioned in this section.

**Importance Prior to and During the Great Recession (2016):**

- **Significance of BRICS:** Brazil, Russia, India, China, and South Africa (BRICS) garnered
significant attention due to their large populations and robust economic growth rates.
- **Economic Growth Rates:** China averaged a remarkable 10% annual growth, India 8%, while
other BRICS nations averaged 4-5% growth.
- **Global Growth Contribution:** BRICS nations contributed to 50% of global growth, raising
predictions of a new global order challenging the traditional economic dominance of the global
North.
- **Key Points:** No specific dates are mentioned in this section.
**Setbacks and Challenges (2015):**
- **Economic Recession:** Russia and Brazil experienced severe recessions due to declining global
consumption and commodity prices.
- **Investor Exodus:** In 2015, a net withdrawal of $500 billion occurred from Russia and Brazil,
marking the largest investor exodus from emerging markets in over two decades.
- **BRICS Growth Decline:** Growth rates for BRICS nations fell to an average of 2% annually,
similar to that of advanced economies, with China being the most affected.
- **Contributing Factors:** Slower growth was attributed to various factors such as political
conflicts, corruption, high debt obligations, and shrinking labor markets.
- **Key Points:** The year 2015 is specifically referenced in this section.

**Current Status and Continued Growth (2015):**

- **Sustained Growth:** Despite setbacks, emerging economies, particularly BRICS, continue to
grow and expand their roles in global production networks.
- **South-South Trade:** Trade between emerging economies, termed South-South trade, has
seen a substantial increase.
- **Moderated Growth:** Growth rates and significance are evolving at a slower pace compared to
the 2000s, reducing perceived threats to developed economies.
- **Challenges Remain:** Despite their growth, emerging economies still face challenges in
achieving greater representation in global economic institutions and trade negotiations.
- **India and China:** These two nations continue to attract substantial economic flows, albeit at
slower rates.
- **Key Points:** The year 2015 is specifically referenced in this section.

**Conclusion:**
Emerging economies remain significant players in the global economy, despite facing setbacks and
experiencing moderated growth in recent years. While they continue to expand their influence,
challenges persist in gaining greater representation in global economic institutions and trade
negotiations.

**The Role of Multinational Corporations (MNCs)**

**Introduction to MNCs (2006):**

- **Definition and Importance:** Multinational corporations (MNCs), including transnational
corporations (TNCs), operate in multiple countries, wielding significant economic power in the
global arena.
- **Perceived Power:** Some argue that MNCs have surpassed nation-states in influence within
the global economy, with companies potentially becoming the primary actors on the world stage.
- **Key Points:** No specific dates mentioned in this section.

**Quantifying MNCs (2007):**

- **Quantification:** MNCs are challenging to quantify precisely, but there are approximately
61,000 MNCs globally with over 900,000 affiliates, contributing about a tenth of the world's gross
national product (GNP) and a third of total world exports.
- **Dominance of Global Corporations:** A small number of global corporations, such as Toyota
and IBM, predominantly hail from developed countries.
- **Emergence of Developing Country MNCs:** While most top MNCs are from developed nations,
MNCs from developing countries are increasing in number and significance.
- **Key Points:** No specific dates mentioned in this section.

**Reasons for Becoming Multinational (2015):**

- **Market-Oriented Investments:** Companies expand internationally due to market saturation,
the need to access new markets, regulatory restrictions in foreign markets, or cultural and political
reasons.
- **Asset-Oriented Investments:** Companies invest internationally to access natural resources,
skilled labor, low-cost labor, or labor with less unionization or legal protections.
- **Modes of Expansion:** MNCs expand through greenfield investments, mergers and
acquisitions, or strategic collaborations.
- **Complexity of Networks:** MNCs create complex networks, balancing centralized control with
local responsiveness and navigating the challenges of global integration.
- **Key Points:** The year 2015 is specifically referenced in this section.

**Challenges and Tensions (2015):**

- **Tensions with Various Actors:** MNCs face tensions with nation-states, local communities,
labor, consumers, and civil society organizations.
- **Counter-Forces:** MNCs have led to the creation of counter-forces such as multiscalar
regulatory systems and international institutes of technical standards.
- **Perspective on MNC Power:** While some perceive MNCs as overpowering nation-states,
others like Dicken argue that the nation-state retains significance and advantages over MNCs.
- **Perspective on Globalization:** Dicken's perspective challenges the notion of a placeless global
world, emphasizing the continued importance of place and geography in MNC operations.
- **Key Points:** The year 2015 is specifically referenced in this section.

**Conclusion:**
Multinational corporations play a pivotal role in the global economy, operating across multiple
countries and exerting significant economic influence. However, challenges persist in managing
their complex networks and navigating tensions with various stakeholders. Differing perspectives
exist regarding the extent of MNC power and the impact of globalization on the role of nation-
states.

**The Myth of Economic Globalization?**

**Overview of the Argument (2009):**

- **Opposing View:** Hirst et al. (2009) challenge the prevailing notion of economic globalization,
asserting that it is a myth.
- **Main Argument:** They argue that while the current economy is indeed highly
internationalized, it may not be unprecedented, and it may be less open than during the period
1870–1914.
- **Key Points:**
- Most companies remain based in nations in terms of assets, production facilities, and sales, with
multinational business stemming from this national base.
- There is no significant movement toward the development of truly multinational businesses.
 - Foreign direct investment (FDI) is primarily directed toward advanced industrial economies
rather than less developed countries.
- Trade continues to be concentrated mainly in Europe, Japan, and North America, with emerging
powers like China and India not yet reshaping global trade to a truly global extent.
- The argument posits a growing supranational regionalization in the international economy, with
the most powerful nations governing it.

**Evaluation of Arguments:**
- **Strengths:** Hirst et al. present solid arguments suggesting that contemporary economic
globalization may not be as new or as extensive as commonly believed.
- **Limitations:** While their arguments challenge the novelty and extent of economic
globalization, they do not necessarily negate the existence of globalization altogether. They focus
on regionalization and the dominance of powerful nations in governing the international economy.
- **Perspective on Economic Globalization:** The viewpoint adopted here suggests that while
Hirst et al.'s arguments have merit, the prevailing view is that the economy is indeed globalized,
albeit with nuances and complexities. Economic globalization has likely intensified since the
publication of their argument a decade ago.

**Conclusion:**
The debate over the myth of economic globalization highlights differing perspectives on the extent
and novelty of globalization. While Hirst et al. argue against the notion of unprecedented
globalization, they do not entirely refute the existence of globalization. Rather, they emphasize
regionalization and the continued influence of powerful nations in governing the international
economy. Overall, while their arguments offer valuable insights, the prevailing view suggests that
economic globalization is a significant and ongoing phenomenon, albeit with nuances and
complexities that warrant further examination.
Chapter 4
Review notes

**Trade**

A good place to get a quick snapshot of global trade (Mann and Pluck
2007), as well as of net economic flows in and out of a given nation‐state,
is that nation's trade surpluses and deficits.

**Trade Surpluses and Deficits:**

 - **US and China Trade Balances:**
1. - The United States had a trade deficit of $566 billion in 2017, ranging between
$361.5 billion in 2001 and $761.7 billion in 2006.
2. - China reported a trade surplus of $422.5 billion in 2017, with the US-China
trade deficit reaching $375.2 billion, the highest ever.
3. - The US blames Chinese monetary policies, alleging undervaluation of the yuan,
and has raised concerns about trade restrictions on US goods.

**Global Trade: Economic Chains and Networks:**

1. - **Supply Chains:** Involve value-adding activities from raw materials to
finished products, exemplified by the transformation of cotton into T-shirts.
2. - **International Production Networks:** Encompass networks of producers
involved in manufacturing, with multinational corporations (MNCs) playing a
central role.
3. - **Global Commodity Chains:** Organize industries globally, with buyer-driven
chains (e.g., Wal-Mart) influencing production and governance structures.
4. - **Global Value Chains:** Emphasize value creation from conception to
disposal, incorporating production, consumption, and broader institutional
contexts.

**Global Value Chains (GVCs): Examples:**

5. - **T-Shirts:** Highlight the role of government interventions, such as subsidies
and trade agreements, shaping global trade dynamics.
6. - **iPhones:** Illustrate complex global value chains, with conceptual design in
the US, assembly in China, and distribution worldwide, coupled with labor
exploitation concerns.
7. - **Automobiles:** Showcase China's rapid emergence as a major player in the
automobile industry, driven by technological expertise, joint ventures, and
venture capital investment.
8. - **Hybrid and Electric Vehicles:** Detail the global value chain for lithium-ion
batteries, dominated by Asian companies, with diverse components sourced
globally.

**Increasing Competition for Commodities**

**Overview:**
- Recent years have witnessed a significant surge in global competition for various
commodities, driven by industrialization and economic growth, particularly in
countries like China and India.
- The demand for commodities extends beyond specific industries, reflecting the
emergence of expansive consumer societies in these countries.

**Examples of Commodities:**
1. **Oil and Natural Gas:**
- Rapid industrialization, especially in China, has fueled demand for energy
resources, making China the world's largest oil importer by 2015.
- China's energy consumption has been largely driven by coal rather than oil, with
China and India accounting for a substantial portion of global coal consumption.

2. **Metals (e.g., Copper, Lithium, Nickel, Silver, Gold):**

- China's industrialization has led to a sharp increase in metals consumption, with
its share rising significantly from 2000 to 2014.

3. **Agricultural Commodities (e.g., Rice, Wheat, Corn, Soybeans):**

- Rising consumer demand in emerging economies has contributed to increased
consumption of agricultural commodities.

**Impact of Industrial Development:**

 - The industrial development in countries like China and India has created a
burgeoning consumer society, mirroring consumption patterns observed in more
developed regions.
 - This demand extends to a wide range of products, including automobiles,
airplanes, and various consumer goods, driving the need for energy resources and
commodities.
 - A fundamental shift in the global economic structure is evident, with increasing
wealth and consumption in emerging economies driving demand for commodities
worldwide.
**Quotations:**
- A commodities specialist highlights the fundamental change in the global economic
structure, with rising wealth and consumption in China and other emerging
economies driving demand for commodities.
- An economist emphasizes the tremendous demand for resources as the world
witnesses the economic awakening of Asia.

**Conclusion:**
The increasing competition for commodities underscores the transformative impact
of industrialization and economic growth in emerging economies, particularly in Asia.
This trend has far-reaching implications for global markets, resource management,
and economic development strategies.

**The Economic Impact of the Flow of Oil**

**Role of Oil in Industrialization and Warfare:**

- Oil has been a pivotal factor driving both industrialization and mechanized warfare
over the past century.
- The pursuit of oil has intensified as nations and economies have developed, leading
to increased demand and competition.

**Challenges in Meeting Demand:**

- Greater demand for oil can lead to higher prices, especially as it becomes more
difficult to find and extract additional resources.
- Extraction methods like hydraulic fracturing (fracking) have been adopted to access
previously unobtainable oil reserves, reshaping oil flows, particularly in the United
States.

**Impact on Oil Importing Countries:**

- The United States has significantly reduced its reliance on oil imports due to
increased domestic production, potentially achieving energy independence.
- However, fracking and higher oil production pose environmental risks, including
groundwater contamination and air pollution, with unknown long-term
consequences.

**Economic Implications of Oil Wealth:**

- Fluctuations in global oil prices have profound effects on the economies of oil-
producing countries.
- A surge in oil prices resulted in significant petrodollar inflows into oil-producing
nations, leading to substantial economic gains.
- Oil wealth has been utilized for domestic development projects, foreign
investments, and social programs, impacting both domestic and global economies.
- However, the distribution of oil wealth within these nations is often unequal, with
elites benefiting disproportionately compared to the general population.
- The dependence of some countries on oil revenues can lead to economic crises
when oil prices decline sharply, as seen in Venezuela's recent experience.

**Sociopolitical Implications:**
- Oil wealth can influence political dynamics, both domestically and internationally,
with implications for geopolitical stability.
- In countries heavily reliant on oil revenues, economic downturns due to oil price
fluctuations can lead to social unrest and political instability.

**Environmental Concerns:**
- The extraction and consumption of oil contribute significantly to global
environmental issues, including climate change.
- Addressing these environmental challenges is essential and will become increasingly
critical in the future.

**Conclusion:**
The flow of oil has profound economic, social, and environmental implications
globally. While oil has driven economic development and prosperity in some regions,
it has also led to inequalities, political tensions, and environmental degradation.
Managing the impact of oil on economies and societies requires addressing both the
opportunities and challenges associated with its production, distribution, and
consumption.

**Race to the Bottom and Upgrading**

**Race to the Bottom:**

- Conceptualizes a downward spiral of competitiveness among countries, particularly
less developed ones, competing for foreign investment.
- Strategies may include offering lower wages, poorer working conditions, and longer
hours to attract multinational corporations (MNCs).
- Countries engaging in the race to the bottom may experience short-term economic
gains but often at the expense of workers' well-being.
**Upgrading in Less Developed Countries:**
- Contrary to the race to the bottom narrative, evidence suggests a process of
industrial upgrading in some less developed countries and industries.
- Examples include China's transition from low-value to high-value products, such as
moving from labor-intensive assembly to more sophisticated manufacturing.
- Similar patterns are observed in Mexico's maquiladora industry, where successive
generations have evolved towards higher value-added activities.
- Industrial upgrading involves moving from low-value to high-value activities within
global production networks, potentially leading to improved economic outcomes.

**Debate on Race to the Bottom:**

- Some argue that winning the race to the bottom is necessary for economic
development and competitiveness.
- Critics challenge this perspective, highlighting negative consequences such as
declining wages, job insecurity, and overall welfare.
- Neoliberal ideology often promotes the race to the bottom as a pathway to
development, but its benefits are disputed.
- Winning the race to the bottom may not guarantee adaptive upgrading but can
perpetuate low wages and poor living conditions.

**Conclusion:**
The concept of the race to the bottom captures the competitive dynamics among
nations vying for economic success. However, evidence suggests that industrial
upgrading is possible, allowing countries to move away from low-value activities
towards higher-value production. While the race to the bottom may offer short-term
gains, its long-term consequences, including inequality and social hardship,
underscore the need for a nuanced understanding of economic development
strategies.

**Outsourcing**

**1. Definition and Scope:**

- **Outsourcing** refers to the transfer of activities once performed by an entity to
other businesses in exchange for payment.
- It extends beyond the economy and includes sectors like healthcare and military.
- Examples include the outsourcing of radiology services in healthcare and logistical
support in the military.
**2. Levels of Outsourcing:**
- Outsourcing is not solely a macro-level phenomenon but occurs at meso- and
micro-levels as well.
- Mesolevel outsourcing involves businesses contracting external entities for services,
such as restaurants outsourcing food production.
- Micro-level outsourcing includes individuals outsourcing caregiving responsibilities
for children or elderly relatives to institutions.

**3. Globalization and Outsourcing:**

- Globalization often plays a role in outsourcing, even at micro-levels, with
immigrants from less developed countries providing caregiving services in developed
nations.
- Offshore outsourcing is closely associated with globalization, involving the transfer
of work to companies in other countries.
- Indian firms are prominent in offshore outsourcing, particularly in call center
services, IT, accounting, and other professional services.
- Offshore outsourcing has benefits such as 24/7 availability of workers and job
creation but also entails costs like job loss in the outsourcing country.

**4. Offshore Outsourcing Beyond the Economy:**

- Offshore outsourcing extends beyond the economy, with examples like the
outsourcing of war functions following the end of the Cold War.
- Private organizations emerged to which various war functions were outsourced,
leading to significant outsourcing during the Iraq War.
- In-sourcing occurs simultaneously with offshore outsourcing, as tasks outsourced to
one country are simultaneously insourced by that country.
- The United States and the United Kingdom also engage in in-sourcing some work
traditionally performed in other countries.

**Conclusion:**
Outsourcing is a multifaceted phenomenon occurring across various levels and
sectors, with globalization playing a significant role, particularly in offshore
outsourcing. While it offers benefits like cost savings and job creation, it also poses
challenges such as job displacement and economic disruptions in outsourcing
countries.
**Financial Globalization and the Great Recession**

**1. Interconnected Economies:**

- Globalization has led to tighter interconnections among the world's economies.
- Economic events in one part of the world can have significant impacts globally, as
seen in the financial crises in Asia, Russia, and Argentina.

**2. The Great Recession:**

- The 2007–08 financial crisis and the Great Recession were the most severe global
economic crises since the Great Depression.
- Several factors contributed to the crisis, including growing inequality, the dot-com
bubble, housing market speculation, and deregulation in the financial industry.

**3. Causes of the Crisis:**

- Rising inequality in the United States due to job losses, offshoring, and stagnant
wages.
- Speculation in the housing market, fueled by the dot-com bubble burst, led to the
subprime mortgage crisis.
- Predatory lending practices and failure to disclose risks associated with subprime
mortgages contributed to the crisis.
- Deregulation, including the repeal of the Glass-Steagall Act in 1999, allowed banks
to engage in risky practices like mortgage securitization.

**4. Global Impact:**

- The crisis spread globally due to interconnected financial markets and investments
in mortgage-backed securities.
- Major banks and financial institutions worldwide faced difficulties and needed
government bailouts.
- The crisis resulted in a significant drop in industrial production, increased
unemployment, and reduced consumer spending globally.

**5. Impact on Different Economies:**

- Economies around the world, including China and Japan, experienced negative
effects due to decreased demand for exports and reduced investment.
- Foreign investments in US corporations raised concerns about foreign control,
particularly by sovereign wealth funds.
- The Great Recession led to long-term unemployment, political turmoil, and the rise
of populist parties in various countries.
**6. Continued Effects:**
- While technically over, the effects of the Great Recession persist, with some regions
experiencing high long-term unemployment and political unrest.
- Austerity measures imposed by neoliberal policies exacerbated economic problems
for many working-class individuals and led to political backlash against economic
elites.

**Conclusion:**
Financial globalization, characterized by interconnected financial markets and
investments, played a significant role in the onset and spread of the Great Recession.
The crisis highlighted the risks associated with deregulation and speculative practices
in the financial industry, leading to widespread economic repercussions globally.

**Consumption in a Global Context**

**1. Historical Context:**

- The association of consumption with America and Americanization stems from the
post-WWII affluence of the United States and its exportation of consumer culture
worldwide.
- The Marshall Plan aided European nations in adopting elements of American
consumer society.

**2. Globalization and Consumption:**

- Neoliberalism promotes increasing global flows of consumer goods and services and
reducing barriers to these flows.
- Credit card brands like Visa and MasterCard, originating in the US, are widely
accepted globally, promoting global consumption and tourism.
- Hyperconsumption and hyperdebt, characteristic of US consumer culture, are
becoming global phenomena.

**3. Localization and Resistance:**

- While Americanization has influenced global consumption, local areas have often
integrated imported goods into their cultural and economic contexts.
- Other nations, such as Germany with Mercedes-Benz and BMW, have been
significant exporters of consumer products.
- Consumption remains largely local in character, and there is active resistance to
external definitions of consumption, as seen with khat in Kenya.
**4. Consumer Objects and Services:**
- Consumption includes both goods and services, with globalization leading to the
spread of global brands and services like accounting firms and package delivery.

**5. Consumer Identity:**

- People increasingly define their identity through consumption, and consumer
culture has emerged globally.
- Tourism is a form of consumption, with tourists seeking to consume goods and
services in other locations.

**6. Consumption Processes and Sites:**

- Consumers worldwide are familiar with consumption processes such as shopping
malls and online purchases, leading to remarkable similarity in consumption behavior
globally.
- American-style consumption sites like shopping malls, fast-food restaurants, and
theme parks have spread globally.

**7. Global Resistance:**

- Concerns and resistance have emerged globally against the spread of chain stores
and globalized consumption sites.
- Movements like Slow Food and Voluntary Simplicity oppose hyperconsumption and
advocate for sustainable consumption practices.

**8. Exclusion from Consumption:**

- A significant portion of the world's population is excluded from many forms of
consumption discussed, due to factors like poverty and lack of access to consumer
goods and services.

**Conclusion:**
Consumption in a global context is characterized by the spread of Americanized
consumer culture, the localization of consumption practices, and resistance to
globalized consumption sites. Despite this, many individuals and communities remain
excluded from mainstream consumption due to economic and social factors.
Chapter 5
Review notes

**Detailed Review Notes: Political Flows in Globalization**

**1. Global Flow of People:**

- Movement of refugees and undocumented immigrants challenges nation-states'
border control.
- Direct threat to existing political structures and sovereignty.

**2. Crises Associated with Dwindling Resources:**

- Dwindling oil and water supplies may lead to riots and insurrections.
- Potential to destabilize and lead to the downfall of governments.

**3. Inability to Control Economic Flows:**

- Multinational corporations dominate economic flows, challenging nation-state
control.
- Global economic integration and interconnectedness can threaten political stability,
particularly in Eastern Europe.

**4. Environmental Problems and Climate Change:**

- Global climate change and environmental issues are likely to be politically
destabilizing.
- Threaten political structures and require international cooperation for mitigation.

**5. Borderless Diseases:**

- Diseases like malaria, Zika, and AIDS pose a danger to political structures,
particularly in Africa.
- Challenge healthcare systems and government responses.

**6. War and Terrorism:**

- War and terrorism pose direct threats to nation-states involved, especially those on
the losing side.
- Political instability and violence result in displacement and socio-political
disruptions.

**7. Global Inequalities:**

- Profound North-South split in global inequalities pits poor nations against rich ones.
- Potential for socio-political conflicts and tensions between nations.
**8. Political Responses and Solutions:**
- Efforts to address global problems often have political dimensions (e.g., trade
protection, liberalization, political transparency, social justice).
- Political structures like nation-states and the United Nations initiate and respond to
various global flows and crises (e.g., war in Syria leading to mass migration).

**Conclusion:**
Political processes are deeply intertwined with various global flows and challenges,
posing threats to existing political structures and requiring political responses and
solutions at local, national, and international levels.

**The Nation-State and Globalization**

**1. Historical Context:**

- The Peace of Westphalia (1648) established the modern nation-state system,
recognizing sovereign states and their right to political self-determination.
- Criticism suggests that Westphalia initiated conflictive state relationships and
potentially led to inter-state wars.

**2. Components of the Nation-State:**

- Nation: Social group linked by common descent, culture, language, or territorial
contiguity.
- National Identity: Fluid collective identity based on shared characteristics.
- Nationalism: Political doctrine making the nation the basis of statehood.
- State: Organizational structure with centralized control and sovereignty.
- Sovereignty: Political authority to govern a people, representing the collective will.

**3. Threats to the Nation-State:**

- Global Economic Flows: Nation-states struggle to control the borderless global
economy.
- Technological and Financial Changes: Accelerated integration into a single global
market.
- Porosity and Weakening: Globalization leads to increased porosity, challenging state
control.
- Global Problems: Issues like AIDS, climate change, and terrorism exceed state
capacities.
- Failed States and Disintegration: States unable to maintain borders or governance.
- New Social Movements: Appeal to international activism and challenge state
authority.
**4. Universal Human Rights:**
- Growing interest in universal human rights challenges state sovereignty.
- Human rights abuses subject to international intervention and accountability.
- Emerged post-Holocaust, with the UN Universal Declaration of Human Rights
(1948).
- Establishment of the International Criminal Court (ICC) as a venue for human rights
trials.

**5. Sustainability and Liquid Sovereignty:**

- Environmental flows (e.g., climate change) challenge state territorial control and
legitimacy.
- Indigenous peoples seek food sovereignty, challenging neoliberalism and global
trade.
- Liquid sovereignty emerges, detaching political authority from traditional state
boundaries.
- Political legitimacy becomes provisional and fluid, adapting to unique global
circumstances.

**Conclusion:**
Globalization challenges the traditional notions of the nation-state, leading to
increased porosity, the rise of universal human rights, and the emergence of liquid
sovereignty. State authority is no longer confined within traditional borders but
fluctuates according to global flows and unique contexts.

**In Defense of the Nation-State: Counterarguments and Perspectives**

**1. Continued Relevance of the Nation-State:**

- Despite globalization, the nation-state remains a major player globally.
- It retains power and efficacy, albeit varying across different states.
- The notion of its demise is considered exaggerated.

**2. Enduring Role of the State:**

- The state faces increasing demands due to collective insecurities such as terrorism,
economic globalization, immigration, and global diseases.
- States may exaggerate threats or create new ones to maintain power and influence.
- Examples include the rise of far-right parties fueled by immigration fears and the
UK's Brexit vote.
**3. Limitations of Global Processes:**
- Global business is not as powerful as commonly perceived compared to domestic
business in many countries.
- Migration to countries like the US has declined substantially since its peak.
- Globalization can be seen as an opportunity for nation-states, not just a threat or
constraint.

**4. Utilizing Globalization for State Interests:**

- Globalization rhetoric is used by politicians to enact reforms beneficial to the state.
- Examples include Australia's shift towards neoliberal policies in response to
globalization demands.
- China's tight control over its territory, coupled with harnessing globalization for
economic growth, illustrates how states can benefit from globalization while
maintaining control.

**Conclusion:**
Contrary to claims of the nation-state's decline, arguments exist for its continued
relevance and adaptability in the face of globalization. States navigate global
challenges by leveraging threats, utilizing globalization for domestic reforms, and
maintaining control over their territories.

**Understanding the Nation-State as an Imagined Community**

**1. Social and Political Construction:**

- The nation-state is not a natural phenomenon but a social and political construct.
- It had to be created, defined, and recognized by those within and outside of it.

**2. Benedict Anderson's Concept of "Imagined Communities":**

- Anderson defines the nation as an imagined political community existing primarily
within people's minds.
- Characteristics of an imagined nation include:
- Imagined due to the impossibility of face-to-face contact with all members.
- Imagined to be limited with finite boundaries.
- Imagined to be sovereign and free.
- Imagined as a community based on deep horizontal comradeship.

**3. Historical Context:**

- The rise of the imagined nation is linked to the development of the modern novel
and newspaper, termed "print capitalism" by Anderson.
- Novels and newspapers facilitated a sense of communal imagination and continuity
through print languages accessible to a wide audience.

**4. Role of Print Capitalism:**

- Mass sale and distribution of novels and newspapers contributed to the rise of the
imagined nation.
- Print languages gave fixity to language, contributing to the solidity and continuity of
the nation concept.

**5. Contemporary Realities:**

- Advancements beyond print capitalism, such as digital media and the internet, have
further enhanced the imagined community.
- Globalization disperses people but provides them with technologies to maintain
connections to imagined communities across borders.

**6. Emotional Underpinnings:**

- Scholars explore the emotional aspects of national identity and pride, especially in
the face of globalization.
- National identity fuels fears of immigration and fosters pride during events like the
World Cup.
- Feelings of shame or pride are attached to certain narratives and rituals, shaping
individuals' experiences within the imagined community.

**Conclusion:**
While the political importance of the nation-state may be declining in the era of
globalization, the concept of the imagined community remains potent, shaping
individuals' sense of identity, belonging, and collective action.

**Changes in Global Nation-State Relations**

**1. Historical Context:**

- Throughout history, political relations among nation-states have structured
international and global interactions.
- During WWII, the divide was between the Allied and Axis powers. During the Cold
War, it was between the Soviet Bloc and the West.

**2. Parag Khanna's Perspective:**

- Khanna distinguishes between globalization (economic flows) and geopolitics
(political and military efforts).
- He suggests that while the US was hegemonic in geopolitics, globalization is
challenging its dominance.
- Khanna predicts the emergence of a new Big Three: European Union, China, and the
United States.

**3. The European Union (EU) and Brexit:**

- The EU has grown since its founding, becoming the largest economic market
globally.
- Brexit poses significant challenges and uncertainties for both the UK and the EU.
- Economic estimates suggest potential declines in trade and incomes post-Brexit.
- Brexit reflects rising nationalist sentiments within EU member states, challenging
the union's cohesion and future role.

**4. China's Ascendancy:**

- China has surpassed the US as the world's largest trading nation and continues to
expand globally.
- It secures access to natural resources, invests in infrastructure projects globally, and
aims for massive urbanization.
- President Xi Jinping aims to expand China's military and political influence,
positioning it as a major global player.

**5. China's Scientific Advancements:**

- China is becoming a "scientific superpower," investing heavily in research and
development.
- Its advancements in science and technology could further bolster its economic and
political power globally.

**Conclusion:**
The global political landscape is evolving with the rise of new geopolitical actors like
the EU and China. Brexit and China's ascendency pose significant challenges and
opportunities for global politics, reshaping the dynamics of nation-state relations.

**United Nations (UN)**

1. **Overview:**
- Premier global organization in politics.
- Established on October 24, 1945, with 193 member states in 2018.
 - State-centric organization opposing arguments on the demise of the nation-state
due to globalization.
- Main organs include the Security Council, General Assembly, and the Secretariat.

2. **Areas of Concern:**
- Military: Initially marginalized during the Cold War but gained importance post-
1991 (Iraq-Kuwait conflict).
- Economic: Focus on reducing global inequality.
- Environmental: Addressing issues like climate change and hazardous wastes.
- Human Protection: Protecting human rights globally.

3. **US Influence:**
- The US played a significant role in the establishment and operation of the UN.
- Largest contributor financially, but the UN's budget is relatively small compared to
the US government's.
- US sometimes bypasses UN decisions if it disagrees significantly (e.g., unilateral
military action).

**United Nations Conference on Trade and Development (UNCTAD)**

- Established in 1964 to improve economic situations of less developed nations.

- Originally resisted neoliberalism but shifted to embrace it in 1992.
- Focuses on trade and development to integrate less developed countries into the
global economy.

**United Nations Educational, Scientific, and Cultural Organization (UNESCO)**

- Established in 1946 with a focus on education, natural and social sciences, and
culture.
- Hindered by Cold War politics and neoliberalism.
- Seeks free movement of knowledge and information, facing budget declines due to
neoliberal policies.

**Global Governance**

1. **Multistakeholder Initiatives:** Public-private partnerships addressing global

issues.
2. **Voluntary Regulations:** Companies agree to social/environmental standards
beyond legal requirements.
3. **Transnational Arbitration Bodies:** Address issues like environmental
violations through investigative processes.
4. **World Economy Governance:** Involves major political entities, nation-states,
trade blocs, corporate policies, and regional integration.

- Growing demand for global governance due to declining power of nation-states,

vast flows of goods and information, and global crises.
- Events like the Syrian conflict and global recessions highlight the need for effective
global governance.
- Shift from inter-state systems to truly global structures for problem-solving.

**Civil Society:**

- **Historical Roots:** Civil society has ancient roots but gained prominence in the
West around 1500. Hegel redefined it as the realm between family and state, where
individuals participate directly in social institutions.

- **Tocqueville's Perspective:** Tocqueville praised early American associations as

vital for social interaction and empowerment.

- **Gramsci's View:** Gramsci highlighted civil society's role in challenging state

hegemony by gaining positions in institutions like universities and media.

- **Post-WWII Era:** Modern civil society grew after WWII, with peace societies and
workers' movements emerging.

- **1970s-1980s:** Latin America and Eastern Europe saw civil society opposition to
military dictatorship.

- **Globalization:** Improved travel and communication facilitated global civil

society, with transnational networks forming on issues like human rights and climate
change.

- **Definition:** Civil society involves negotiation, struggle, and agreement among

individuals and authorities, encompassing voluntary associations, movements,
parties, and unions.

**Global Civil Society:**

- **Definition:** Global civil society is a dynamic network of interconnected socio-

economic institutions with effects felt globally.
- **Interconnectedness:** Global civil society involves various networks, institutions,
and actors aiming to draw the world together and pluralize power.

- **Interplay with the Market:** Civil society and the market are intertwined; civil
society norms influence market behavior, and vice versa.

- **Impact of Market Forces:** Market forces are crucial for global civil society's
functioning, but they can also disrupt it through social inequality and domination
over non-profit institutions.

**INGOs:**

- **Definition:** International non-governmental organizations (INGOs) perform

public functions globally without state control.

- **Characteristics:** INGOs are private, voluntary, non-profit organizations

advocating for various causes.

- **Influence and Controversies:** INGOs influence policies, participate in

multilateral forums, but face criticisms for being undemocratic, elitist, and sometimes
co-opted by neoliberal agendas.

- **Role in Global Policy:** INGOs play a significant role in shaping global policy
issues and have been instrumental in achievements like the International Campaign
to Ban Landmines treaty.

- **Challenges:** INGOs face challenges like maintaining democratic principles,

accountability, and avoiding co-option by intergovernmental organizations (IGOs).

- **Relationship with IGOs:** INGOs often collaborate with IGOs, gaining legitimacy
and funding but risking co-option and loss of autonomy.

These notes provide a comprehensive overview of civil society, global civil society,
and the role of INGOs, highlighting their significance, challenges, and interrelations.
Chapter 6
Review notes

**Technological Advances and Globalization:**

1. **Time–Space Compression:** This concept refers to the shrinking of space and

the reduction of time required for various processes due to advancements in
transportation and communication technologies. Examples include:
- **Containerization:** The invention of container ships in 1956 revolutionized
commerce by significantly reducing loading and unloading times, leading to faster
and cheaper transportation of goods.
- **Air Freight:** Introduction of technologies like the Boeing 747 and companies
like FedEx accelerated the transportation of goods, reducing distances and costs.
- **UPC Codes:** The use of Universal Product Codes (UPC) in 1974 streamlined
inventory management and product movement, further enhancing efficiency in
supply chains.
- **Personal Computers and Internet:** These innovations transformed global
transactions and value chains, enabling coordination between headquarters,
production facilities, and customers across the globe.
- **Telecommunications and Social Media:** Technologies like smartphones,
Skype, Facebook, and Twitter have connected people worldwide, facilitating rapid
interpersonal communication.

2. **Time–Space Distanciation:** This concept involves the stretching of social

relations across time and space, enabled by technological advancements. It's driven
by factors independent of capitalist pursuits, unlike time–space compression.
Examples include:
- **Telecommunications Devices and Social Media:** These technologies decouple
time from space, allowing relationships to exist without physical co-presence.
- **Different Driving Forces:** While time–space compression is driven by capitalist
pursuits, time–space distanciation is attributed to technological changes independent
of capitalism.

3. **Space-Based Technologies:** Space technology, including satellites and GPS

systems, plays a crucial role in globalization. Examples include:
- **Military Surveillance:** Countries like the US use satellites for military
surveillance worldwide.
- **Civilian Applications:** Satellites are used for TV transmission, GPS for
navigation, and microsatellites for various commercial applications.
 - **Space Tourism:** Companies like Virgin Galactic, SpaceX, and Blue Origin are
exploring space tourism, potentially revolutionizing travel and tourism industries.

4. **Robotic Production:** Robotics, fueled by advancements in computing power

and artificial intelligence, are reshaping various industries by automating tasks
traditionally performed by humans. Examples include:
- **Automation in Manufacturing:** Robots are increasingly replacing human labor
in manufacturing, including fast-food preparation and assembly lines.
- **Impact on Jobs:** There are concerns about job displacement, particularly in
white-collar sectors like education and writing assessment, as automation becomes
more sophisticated.

5. **Leapfrogging:** Developing nations often bypass earlier technologies and adopt

more advanced ones directly, accelerating their development. Examples include:
- **Solar Energy:** Many African countries are leapfrogging traditional power
systems by adopting solar energy, reducing costs and improving access to electricity.
- **Mobile Communication:** Adoption of mobile phones and internet access,
bypassing traditional landline systems, is common in developing regions.

6. **Challenges and Barriers:** Despite the potential benefits, several barriers

hinder the spread of advanced technology in developing countries:
- **Infrastructure Deficiencies:** Lack of basic infrastructure like roads, schools,
and utilities hinders the adoption of advanced technologies.
- **Socioeconomic Factors:** Illiteracy, limited R&D capacity, and weak governance
also impede technological advancement.
- **Conflict and Instability:** Warfare and civil unrest disrupt infrastructure and
impede technological progress in affected regions.

Overall, while technological advancements have significantly contributed to

globalization, the uneven distribution of technology and associated challenges
highlight the complexities of global technological diffusion.

**Mass Media and Compression of Time-Space:**

- "Mass media" includes traditional forms like newspapers, radio, television, and film,
as well as newer social media.
- These media forms facilitate compression of time-space and distanciation.
- The printing revolution in early modern Europe allowed for the dissemination of
knowledge across vast distances.
- Radio further compressed time-space through instantaneous communication on
radio waves.
- Television and film stimulated co-presence between performers and absent
audiences, removing physical barriers to social interaction.
- Mass media messages resemble liquids and gases, flowing seamlessly around the
world.

**Media Imperialism:**
- Western (especially US) media and technologies have historically been viewed as
dominant and imperialistic.
- However, alternative global media giants have emerged, challenging Western
dominance (e.g., Al Jazeera, Bollywood, Nollywood).
- Local and regional media have become increasingly important, as has the internet
as a source of diverse media.
- Media products are interpreted differently by different audiences globally,
undermining the notion of media imperialism.

**New Global Media:**

- The rise of new global media (e.g., Apple, Facebook, Alibaba, Twitter, Google,
Microsoft) has led to dominance by a few large corporations.
- Most of these corporations are headquartered in the US, Japan, UK, South Korea,
and China.
- Old and new media are forming partnerships and seeking dominance in the global
media landscape.
- Control over internet media is becoming less competitive as large corporations seek
to maximize profits.

**Thinking About the Global Media:**

- Marshall McLuhan's concept of the "global village" emphasized the power of media
to shape individual subjectivity and culture globally.
- Other perspectives, such as Guy Debord's concept of media spectacle, highlight the
role of media in producing and reproducing capitalism and consumer culture on a
global scale.
- Marginal voices and counter-hegemonic narratives circulate globally, challenging
dominant media discourses.
- Neo-Marxian theories, like those of the Frankfurt School, view the media as tools of
social control that foreclose the possibility of emancipatory discourse and action.
- Global media culture is heavily influenced by multinational corporations (MNCs) and
tends to produce homogeneous products, blurring national boundaries.
- Despite the dominance of global media conglomerates, there are struggles between
the global and the local (or grobal-glocal), with local movements and oppositional
media challenging dominant narratives.
- Restructuring the media and utilizing less spectacular forms of communication may
be necessary for more radical change.

** "The Internet and Social Media"**

**Introduction to Digital Technologies:**

- Digital technologies store and transmit data based on binary coding.
- Examples include computers, chips, processors, DVDs, wireless routers, tablets, 3D
printers, wearable technologies, etc.
- Internet's profound effect on globalization: facilitates global communication and
interaction.

**Internet as a Global Phenomenon:**

- Internet users exist virtually everywhere in the world, albeit unequally distributed.
- Produced and maintained by global/transnational corporations and organizations.
- Driven by capitalist corporations, facilitating time-space compression.

**Social Networking Sites:**

- Definition of social media: user-generated content.
- Social networking sites enable communication, networking, and creation of
friendship networks.
- Prosumers simultaneously produce and consume content.
- Global nature of social networking sites; examples include Facebook, Twitter,
Instagram, LinkedIn, etc.
- Social networking sites shape individual identity globally.

**Bitcoin and Blockchain:**

- Blockchain serves as a digital ledger integral to Bitcoin and other cryptocurrencies.
- Bitcoin is a globally available, decentralized digital currency.
- Blockchain involves multidirectional flow of information about transactions.
- Challenges and advantages of Bitcoin compared to traditional fiat currencies.
- Global nature of Bitcoin and blockchain technology.

**The Internet in China:**

- China has the largest number of Internet users globally.
- The Great Firewall of China: censorship and control of Internet content.
- Restrictions on access to foreign websites, censorship of sensitive content.
- Strategies for policing online content in China.
- Signs of rebellion against Internet censorship.

**Global Internet Governance:**

- Emergence of global Internet governance through multistakeholder negotiations.
- Recent attempts to assert state control over the Internet.
- US surveillance revealed by Edward Snowden; implications for Internet governance.
- Advocacy for a human rights-based, multistakeholder approach to Internet
governance.

**Social Media and Social Movements:**

- Role of social media in empowering social movements.
- Castells' concept of "mass self-communication" through social media.
- Examples of social movements facilitated by social media: Egyptian Revolution,
Chile's student movement, Hong Kong's Umbrella Revolution, etc.
- Platforms like Avaaz.org facilitating global activism.
- Technology enabling instant global information flow and collective organizing.
- Challenges to government and corporate control over information flows.