UNIT 1: INTRODUCTION TO GLOBALIZATION goods and services and has created many new opportunities

for international trade and investment.

GLOBALIZATION
- In simpler terms, more countries are open for
- The process in which people, ideas and goods spread
business with each other, leading to more trade and
throughout the world, spurring more interaction and
economic growth.
integration between the world's cultures, governments
and economies. Governments have worked together to reduce obstacles to
- A process of interaction and integration among the trade and create agreements that make it easier to buy, sell,
people, companies, and governments of different nations, and invest across countries. Because of these new
a process driven by international trade and investment opportunities, companies have built factories in other
and aided by information technology. This process has countries and partnered with foreign businesses to make and
effects on the environment, on culture, on political sell products.
systems, on economic development and prosperity, and - Meaning, countries have made it easier to do
on human physical well-being in societies around the business with each other, and companies are now
world. taking advantage of this by expanding internationally.
o A key part of globalization is that businesses and
- It is about growing worldwide connectivity financial systems are now connected across many
Example: People are engaged in buying and selling from countries.
other places in far-away lands like the Silk Road (network
of route use by traders) across Central Asia that - Globalization is the process of integration of
connected China and Europe during the Middle Age for economies across the world through cross-border
thousands of years and they also invested in enterprises flow of factors product and information
in other countries for centuries.
According to the INTERNATIONAL MONETARY FUND
- Today's globalization is farther, faster, cheaper, and (IMF), Globalization is when countries become more
deeper in compared to earlier wave of globalization economically connected by trading more goods and services,
Example: In the past, it could take weeks or months for moving money across borders, and sharing technology faster
goods to be shipped from one country to another. Today, a and more widely. It means countries around the world rely
product like a smartphone can be designed in the U.S., more each other for business, money, and technology.
parts made in different countries, assembled in China,
ONE PRINCIPAL DRIVER OF GLOBALIZATION IS
and then sold globally-all within a matter of days.
TECHNOLOGY
Information and ideas can spread instantly online, making
 Economic life is dramatically transformed by
the world more interconnected at every level
advancement in information technology.
Additional Information:  Information technologies give people like consumers,
Since World War II, and especially in the last 20 years, many investors, and businesses powerful tools to find and
governments have started using free-market economic take advantage of new economic opportunities. These
systems. This has helped these countries produce more tools help them quickly understand global economic
 trends, easily move money or assets, and work 2. Globalization is reflected in the expansion and
together with partners from all over the world. the stretching of social relations, activities, and
connections.
"Globalization is an expansion, and intensification of
Example: Online shopping platforms like Amazon, Shopee,
social relations and consciousness across world time
Shein, Lazada, allow people to buy products from around
and world space. It is about growing worldwide
the world, expanding their shopping options far beyond
connectivity" - Steger
local stores.

3. Globalization means that social interactions and

activities are happening more quickly and
frequently.
Further, Example: Video calls on Zoom let people have face-to-
o Globalization is considered a multi-dimensional face conversations with anyone around the world
process involving economic, political, technological, instantly, making communication faster and more
cultural, religious and ecological dimensions. frequent
o It suggests a dynamic process of change that results in
either positive or negative development. 4. Globalization affects not just the way we interact
o Globalization creates new things and increases the with the world through things and materials, but
number of connections and activities between people also how we think and feel. Even though people
and places, going beyond old boundaries like still have local and national ties, the idea of a
countries, economies, cultures, and regions. global perspective is becoming a bigger part of
how we viey and approach things.
ATTRIBUTES, QUALITIES OR CHARACTERISTICS OF Example: Many people use global brands like Apple or
GLOBALIZATION Nike and follow international news and trends on social
Globalization has FOUR CHARACTERISTICS OR media. This global mindset influences how they make
QUALITIES. These are: decisions and see themselves, even though they continue
1. It involves both the creation of new social to value their local cultures and traditions.
networks and the multiplication. of existing HISTORICAL PERIODS OF GLOBALIZATION
connections that cut across traditional, political, 1. THE PREHISTORIC PERIOD (10000 BCE-3500 BCE)
economic, cultural, and geographical - In this earliest phase of globalization, contacts among
boundaries. hunters and gatherers who were spread around the world
Example: Social media platforms like Instagram connect were geographically limited. In this period due to absence
people from all over the world. You can follow friends, of advanced forms of technology, globalization was
celebrities, and businesses from different countries, severely limited.
sharing and seeing posts that cross borders and cultures.
2. THE PRE-MODERN PERIOD (3500 BCE-1500 CE)
 - In this period the invention of writing and the wheel were - This means that technology and large amounts of money
great social and technological boosts that moved moving around the world have greatly increased global
globalization to a new level. The invention of wheel in trade in resources and products.
addition to roads made the transportation of people and Example: The rise of global financial markets means that
goods more efficient. investors from around the world can buy and sell stocks in
- On the other hand writing facilitated the spread of ideas companies from different countries. For instance, someone in
and inventions. Japan might invest in a tech company based in Germany, and
that company can use the money to expand its operations
3. THE EARLY MODERN PERIOD (1500-1750)
globally.
- It is the period between the Enlightenment and the
The result of these powerful forces resulted in the wide
Renaissance. In this period, European Enlightenment
gap between the rich and the poor countries.
project tried to achieve a universal form of morality and
law. This with the emergence of European metropolitan Major Sources of Economic Growth across Countries
centers and unlimited material accumulation which led to 1. Property rights
the capitalist world system helped to strengthen 2. Regulatory institutions
globalization. 3. Institutions for macro-economics
4. Stabilization
4. THE MODERN PERIOD (1750-1970)
5. Institutions for social influence
- Innovations in transportation and communication
6. Institutions for conflict management
technology, population explosion, and increase in
migration led to more cultural exchanges and Economic institutions play a crucial role in deciding how
transformation in traditional social patterns. Process of money is invested in things like infrastructure, education,
industrialization also accelerated. technology, and industries. They also affect how resources
are shared and allocated.

5. THE CONTEMPORARY PERIOD (from 1970 to present) 2. POLITICAL DIMENSION

- the world has become much more connected and - an enlargement and strengthening of political
dependent on each other in a and very noticeable and rapid interrelations across the globe
way.

SIX DIMENSIONS OF GLOBALIZATION Political Issues that Surface in this Dimension

1. ECONOMIC DIMENSION 1. The principle of state sovereignty
- the extensive development of economic relations across 2. Increasing impact of various organization
the globe as a result of technology and the enormous flow intergovernmental
of capital that has stimulated trade in both sources and 3. Future shapes of regional and global governance
goods.
The globalization rendered almost powerless any political
efforts to introduce restrictive policies affecting individual
states, with the results that the world in many ways turned
into a borderless world. Governments often seek to restrict Example: The fusion cuisine you might find in many cities
the migration of peoples, especially those coming from the combines ingredients and cooking styles from different
poor countries in the global South (11 a). cultures. For instance, sushi burritos blend Japanese sushi
with Mexican burritos, reflecting a mix of global and local
In the development of supra-national structures and
influences.
associations held together by common concerns and
mutually agreed upon norm, the most obvious is political 4. RELIGIOUS DIMENSION
globalization. RELIGION
- A personal or institutionalized set of attitudes, beliefs,
On the part of the involved parties, informal structures which
and practices relating to or manifesting faithful devotion
are considered binding, bring together world power centers
to an acknowledged ultimate reality or deity. It is the most
due to common interests.
important defining element of any civilization as
EXAMPLE: Global cities like New York, London, Tokyo, and contrasted with race, language, or way of life.
Singapore are closely connected with one another than they
JIHADIST GLOBALISM
are to various cities in their own countries.
- Is a radical religious movement that reacts against
Example: New York City might have more business and
Western influences, which they see as harmful to their
financial connections with London and Tokyo than with
pure form of Islam. Followers of this movement aim to
other cities in the U.S. Similarly, these global cities often
eliminate foreign influences they believe are corrupting
collaborate on international projects and share global
Muslim societies. This includes using extreme violence
markets.
and terrorism to achieve their goals.
3. CULTURAL DIMENSION - It also applies to some violent extremists in the West
- the increase in the amount of cultural flows across the who want to turn the world into a Christian-dominated
globe. empire.
- Cultural interconnections are at the foundations of - extreme groups that use religion as a reason to fight
contemporary globalization. against what they see as foreign or opposing influences,
Example: The global popularity of K-pop music from South whether in the Muslim world or in Western countries.
Korea shows how cultural elements can spread widely and Example: Some extremist groups might use terrorism to fight
influence people everywhere, making cultural exchanges an against Western values they disagree with, believing that
important part of globalization. their version of Islam is under threat.
- Cultural diversity often results hybridization-
ROMAN CATHOLIC TEACHING OF GLOBALIZATION
constructive interaction process between global and local
(8) PRINCIPLES that summarize the Roman Catholic
characteristics which is often visible in food, music,
1. Commitment to universal human rights
dance, film, fashion, and language. As a result there is a
2. Commitment to the social nature of the human person
scarcely any society in the world that expresses itself in
3. Commitment to the common good
its own self-contained and authentic culture.
 4. Solidarity (affirms that membership in the human - a system of widely shared ideas, beliefs, norms and
family means that all bear responsibility for one values among a group of people. It is often used to
another.) legitimize certain political interests or to defend dominant
5. Preferential option of the poor (In the Theology of the power structures. Ideology connects human actions with
Incarnation- Christ God became poor for us so as to some generalized claims
enrich us by his poverty. The poor are susceptible to - GLOBALIZATION is a social process of intensifying
the effects of environmental irresponsibility because global interdependence while GLOBALISM is an ideology
they live in countries where cheap building materials that gives the concept of neo-liberal values and meanings
and cheap labor are readily available. They regularly to globalization.
work in farming, fishing, and forestry, areas which
MAJOR IDEOLOGICAL CLAIMS OF ADVOCATES OF
suffer environmental damage).
GLOBALISM
6. Subsidiary (The Catholic Church teaches that decisions
1. Globalization is about the liberalization and global
should be made at the lowest level in order to achieve
integration of markets
the common good.
- The problem with this claim is that liberalization and
7. Justice
integration of markets happen through political project of
8. Integral Humanism is concerned with whole person
engineering free markets by interference of centralized
JUSTICE IS DIVIDED IN THREE (3) CATEGORIES: state power, and it is in contrast to the neoliberal ideal of
1. COMMUTATIVE JUSTICE limited role of governments.
- This aims at fulfilling the terms of contracts and other
2. Globalization is inevitable and irreversible
promises on both personal and social level.
- Globalists believe that spread of market forces driven by
2. DISTRIBUTIVE JUSTICE
technological innovations is inevitable in globalization.
- This ensures a basic equity in how both the burden
Neoliberals use this claim to convince people to adopt the
and the goods of society are distributed and that
natural discipline of the market if they want to prosper,
ensures that every person enjoys a basically equal
which implies the elimination of government controls over
moral and legal standing apart from differences in
the market.centralized state power, and it is in contrast to
wealth, privilege, talent and achievements.
the neoliberal ideal of limited role of governments.
3. SOCIAL JUSTICE
- creation of the conditions in which the first two 3. Nobody is in charge of globalization
categories of justice can be realized and the common - This claim seeks to depoliticize the public debate on
good identified and defended. globalization and neutralizing anti -globalist movements.
"A just society is one which these forms of justice are 4. Globalization benefits everyone
assured because they are required by human dignity." - Globalists talk about the benefits of market liberalization
-CATHOLIC TEACHING such as rising global living standards, economic efficiency,
individual freedom, and technological progress. But the
5. IDEOLOGICAL DIMENSION
reality is that the opportunities of globalization are spread
IDEOLOGY
 unequally and power and wealth are concentrated among connected and interdependent. This happens mainly
a specific group of people, regions and corporations and through the exchange of goods, services, and money
corporations I project of engineering free markets by between countries, making the world more interconnected
interference of centralized state power, and it is in economically.
contrast to the neoliberal ideal ofimited role of - the movement of people (labor) and knowledge
governments. (technology) across international.

How people and ideas move between countries?

5. Globalization furthers the spread of democracy in  PEOPLE (LABOR) - workers or employees moving
the world from one country to another, either for jobs. better
- For the globalists democracy and free markets are opportunities, or other reasons.
synonymous.  KNOWLEDGE (TECHNOLOGY) - the sharing and
spread of information, skills, and technology between
The neoliberal explanation of globalization is ideological
different countries. Together, it describes how both
because it is politically motivated and contributes to the
workers and knowledge cross international borders,
construction of particular meanings of globalization which
which can impact economies, cultures, and industries
stabilize existing power relations.
globally.
Globalism tries to create collective meaning and shape
INTERNATION MONETARY FUND (IMF)
people's identities.
o Purpose: The IMF provides financial assistance,
——————————————————————————————— advice, and support to countries facing economic
—— problems. such as financial crises, currency issues, or
high debt levels
UNIT 2: THE STRUCTURES OF GLOBALIZATION
o Functions: It offers loans to countries that need
LESSON 2.1 THE GLOBAL ECONOMY money but in return, these countries often need to
ECONOMIC GLOBALIZATION make changes to their economic policies. The IMF also
- the increasing interdependence of world economies scale monitors global economic trends and provides
of result of the growing cross-border and services, trade guidance to promote stability and growth in the world
of commodities flow of international capital and wide and economy.
rapid spread of technologies. o Members: Most countries in the world are members of
- it reflects the continuing expansion and mutual the IMF. and they work together to ensure global
integration of market frontiers, and is an Irreversible trend
In economic terms, globalization is nothing but a process
for the economic development in the whole world at the
making the world economy an organic system by extending
turn of the millennium.
transnational economic processes and economic relations to
- a process that has developed over time, driven by human
more and more countries and by deepening the economic
creativity and advances in technology. It means that
interdependencies among them.
economies around the world are becoming more
In the context of globalization, calling the world economy an other countries, and vice versa. This worldwide exchange
organic system means that different countries and helps to expand markets, increase variety, and often
economies are interconnected, and changes in one part can lower prices.
affect the whole system. Just like the organs in a living
2. The globalization of financial and capital markets
organism work together to keep it functioning, countries in a
- money and investments can move easily across
global economy are linked and rely on each other to keep the
different countries. This process connects financial
economic system working smoothly.
systems around the world, so people and companies from
Two Major Driving Forces for Economic Globalization various countries can buy and sell investments, like
1. The rapid growing of information in all types of stocks or bonds, anywhere they want As a result, financial
productive activities markets become more integrated and interdependent
More Information: The fast growth of information and globally.
technology is making it easier for businesses and economies
3. The globalization of communication technology and
to connect and operate across borders.
communication
2. Marketization - technology and ways to communicate are spreading
o Market Changes: Countries are restructuring their around the world. It means people everywhere can use
economies to make state-owned businesses operate more the same tech, like smartphones and the intemet, and
like private companies. This means reducing government communicate easily with others no matter where they
support, changing how businesses are managed, and are. This helps people and businesses connect and share
allowing more, private ownership. This helps businesses information across different countries more easily than
become more competitive and integrated into the global before.The globalization production.
market.
o Rapid development of science and technologies served as
4. The globalization of production
basis for immediate globalization of the world economies
- spreading out the making of goods and services across
which in turn provided an environment where there is a
different countries. Instead of producing everything in one
swift spreading of market economic system all over the
place, companies now set up factories, use materials, and
world.
hire workers from all around the world. This helps them
o It is also developed based on the increasing cross-border
get the best resources and lower costs while reaching
division of labor which penetrates within the enterprises
more markets.
of different countries on the level of production chains
DIFFERENCE BETWEEN ECONOMIC GLOBALIZATION
DIMENSIONS OF ECONOMIC GLOBALIZATION
FROM INTERNATIONALIZATION?
1. The globalization of trade of goods and services
Economic globalization is about how different parts of the
- countries around the world are buying and selling
world become more connected through economic activities.
products and services from each other more than ever
This isn't just about doing more business internationally (like
before. It's about businesses and consumers in one
more exports or imports); it's about how businesses and
country getting access to products and services from
economies start working together in new and deeper ways. boundaries of the Parthian empire (to what is now known
It's a change in the way things work, not just a matter of as Iraq), and continued onwards towards Rome.
doing more of the same. - This trade route connected different regions and cultures,
showing how global trade has been happening for a long
Internationalization, on the other hand, is more about
time.
spreading out economic activities to different countries. It's
about expanding business operations or trade across borders, IN THE 17TH AND 18TH CENTURY
but it doesn't necessarily mean the same level of deep - The global economy is mainly seen through trade and
connection and integration as globalization. exchange between countries, rather than production. This
means that the value of what countries export to each
In summary, GLOBALIZATION means a fundamental
other is a small part of the total world economy. For
change in how economies are connected, while
example, world exports contribute only 1 to 2 percent to
INTERNATIONALIZATION is about extending
the global Gross Domestic Product (GDP), which is a
economic activities to more countries.
measure of all economic activity.
Economic globalization has led to the rise of big companies
IN THE 19TH CENTURY
called transnational corporations (TNCs). These
The advent of globalization approaching its modern form is
companies operate in multiple countries and are key players
witnessed. A short period before World War I is referred to as
in the global economy. They are often referred to as
golden characterized age of globalization by relative peace,
multinational corporations.
free trade, financial and economic stability.
A transnational corporation has its main office (or home
Growth in international exchange of goods accelerated in the
base) in one country but does business, owns assets, or
second quarter of the 19 th century.
operates in other countries as well. For example, companies
o Relative peace: There were fewer global conflicts,
like General Electric (GE), Coca-Cola, and Nike are based in
allowing countries to cooperate more.
the US but have operations all over the world.
o Free trade: Countries traded goods more freely
These TNCs are responsible for a significant portion of without heavy restrictions or tariffs,
international trade, making up about two-thirds of world o Financial and economic stability: There was a
exports. balance in global financial systems, which helped
maintain economic growth and stability across nations.
ORIGIN OF ECONOMIC GLOBALIZATION
IN THE 16TH CENTURY IN THE 19TH AND 20TH CENTURY
- World system analysts identify the origin of modernity and - Global economy in the 19 th and 20 th centuries grew by
globalization through long distance trade in the 16 th an average of nearly 4 percent per annum, which is
century. roughly twice as high as growth in the national incomes of
- This best known example of archaic globalization is the the developed economies since the late 19 th century.
Silk Road, which started in western China, reached the
INTERNATIONAL MONETARY SYSTEMS AND GOLD
STANDARDS
INTERNATIONAL MONETARY SYSTEM (IMS) authority overseeing transactions. Gold and silver acted
- a system that forms rules and standards for facilitating as the main form of money, and international trade relied
international trade among the nations. It helps in less on modern money systems and more on the value of
reallocating the capital and investment from one nation to these metals. For example, traders would exchange goods
another. using gold coins instead of using paper money or relying
- It is the global network of the government and financial on financial institutions to manage transactions.
institutions that determine the exchange rate of different - The GOLD STANDARD was a system where a country's
currencies for international trade. It is a governing body currency was directly linked to its gold reserves. This
that sets rules and regulations by which different nations meant that the currency could be exchanged for a fixed
exchange currencies with each other amount of gold, providing stability and reducing inflation
- IMS as rules, customs, instruments, facilities, and because the supply of money was limited by the amount
organizations for effecting international payments with of gold the country had. Under this system, international
the main task of facilitating cross-border transactions trade was settled in gold, creating fixed exchange rates
especially trade and investment. between countries, which made international trade more
- It also reflects economic power and interests, as money is predictable and stable. For example, if the U.S. dollar was
inherently political, an integral part of high politics or backed by gold, you could exchange a dollar for a specific
diplomacy. The strength and stability of a country's amount of gold at any time.
currency can influence its global influence and strategic
AFTER WORLD WAR I
position international relations.
- The use of gold declined because wars increased
- Rules and customs: The rules and practices followed for
government spending and led to inflation, making it
international transactions.
difficult to maintain the gold standard. Major economic
- Instruments: Tools or means such as money or credit
powers tried to keep their currencies tied to gold, but they
used for payments.
couldn't sustain it during economic crises. The system
- Facilities: Infrastructure that supports transactions, like
ultimately collapsed during the Great Depression in 1931,
banks or payment systems.
as countries needed more flexibility to manage their
- Organizations: Institutions like the IMF (International
economies and address the financial challenges of the
Monetary, Fund) that organize and support this system.
time.
The goal of IMS is to ensure that international transactions
IN 1944
smooth, reliable, and secure.
- 730 representatives of 44 nations met at Bretton Woods,
EVOLUTION OF THE INTERNATIONA L MONETARY New Hampshire, United States to create a new
SYSTEM international monetary system called as the Bretton
IN 1870 TO 1914 Woods system, the aim of which is to create a stabilized
- In the past, trade used gold and silver directly, without international currency system and ensure a monetary
banks or governments controlling the process. This stability for all the nations
system was decentralized, meaning there was no central
- Since the United States held most of the world's gold, all be influenced by various factors like economic data,
the nations would determine the values of their currencies political events, and global financial trends.
in terms of dollar. The central banks of nations were given
To assess whether the gold standard was successful, the
the task of maintaining fixed exchange rates with respect
following roles of a properly designed IMS must be
to dollar for each currency.
considered: to lend order and stability to foreign exchange
IN 1971 markets, to encourage the elimination of balance-of-
- The Bretton Woods system ended in 1971 as the trade payments problems, and to provide access to international
deficit and growing inflation undermined the value of credits in the event of disruptive shocks
dollar in the whole world. As confidence in the dollar
In summary, while the gold standard aimed to provide
declined, countries began to demand gold for their
stability and order, it struggled with some practical issues,
dollars, leading the U.S. to end the gold convertibility,
especially in addressing balance-of-payments problems and
effectively collapsing the system and moving towards
offering support during economic disruptions.
floating exchange rates.
EUROPEAN MONETARY INTEGRATION
IN 1973
The development of the European Monetary System (EMS),
- The floating exchange rate system, also known as flexible
which began in the late 1960s. It aimed to reduce the
exchange rate system was developed that was market
dominance of the US dollar on exchange rates and involved
based. In this system, currency values are determined by
various efforts to create closer monetary cooperation among
market forces-supply and demand-rather than being
European countries. This led to the formation of the
pegged to a fixed value like gold. This allows exchange
Economic and Monetary Union (EMU) and the introduction of
rates to fluctuate freely, reflecting changes in economic
the euro as a common currency. The EMU and the euro bring
conditions, trade balances and investor sentiment.
benefits such as reduced exchange rate volatility. increased
Imagine you're traveling to another country and need to economic stability, and greater ease of trade and travel
exchange your money. If the exchange rate between your among member states.
home currency and the local currency is set by a floating
o Reduced Exchange Rate Volatility: For example, if
system, it might change from day to day.
a business in France wants to sell goods in Germany, it
Example: Suppose you're from the US and are
doesn't have to worry about fluctuating currency
traveling to Europe. Today, 1 US dollar might exchange
values between the French franc and the German
for 0.85 euros. Tomorrow, if the demand for euros
mark; both countries use the euro.
increases (perhaps because of good economic news
o Increased Economic Stability: Countries that share
from Europe), the exchange rate might change to 1 US
dollar = 0.83 euros. Conversely, if demand for euros the euro are less likely to experience economic shocks
decreases, the rate might change to 1 US dollar = 0.87 individually because they work together on monetary
euros. In this system, currency values move based on policy.
what buyers and sellers are willing to pay, which can o Greater Ease of Trade and Travel: With the euro, a
traveler can move from Spain to Italy without needing
 to change money, making travel simpler aand - A permanent fund created by the European Union (EU) to
promoting tourism. provide emergency assistance to member states within
the Union. It raises money through the financial markets,
In short, the EMS laid the groundwork for the euro, making
and is guaranteed by the European Commission. Fund
trade and travel easier for European countries while
raised through the markets, use the budget of the
promoting economic stability
European Union as collateral.
However, some European countries faced serious financial - An organization created by the European Union to provide
problems due to poor economic management and big assistance to member states with unstable economies.
imbalances in their economies. This led to a banking crisis
INTERNATIONAL TRADE AND TRADE POLICY
and debt issues for governments. To fix these problems, the
1. INTERNATIONAL TRADE
European Union needs to improve how it manages the
- The exchange of goods, services, and capital across
common currency and create better ways to spot and handle
national borders is knows international trade. It's a huge,
economic problems early. For example, if a country like
multi-million dollar activity crucial to the economies. of
Greece starts having trouble with its finances, the EU needs
many countries. For many people, it's the main way to get
better rules and tools to help fix the situation before it gets
resources and products that aren't available locally. For
worse.
example, a country with few natural resources mig rely on
THE EUROPEAN ΜΟΝΕΤARY SYSTEM (EMS) 1979 international trade to obtain raw materials finished goods
- It aimed to stabilize exchange rates among several it needs.
European countries by linking their currencies. This
2 key concepts in the economics of international
system helped reduce fluctuations in exchange rates and
trade are specialization and comparative
fostered closer economic cooperation.
advantage
- The EMS was later succeeded by the Economic and
 SPECIALIZATION - refers to this process; countries as
Monetary Union (EMU), which is a key institution of the
well as individual businesses can maximize their
European Union (EU). The EMU established thes euro as a
welfare by specializing in the production of those
common currency, further enhancing economic
goods where they are most efficient and enjoy the
integration among member states and facilitating trade
largest advantages over rivals.
and travel across Europe.
Example:
- Originated in an attempt to stabilize inflation and stop
Country X: Can produce 15 computers or 10
large exchange rate fluctuations (significant and rapid
smartphones.
changes in the value) between European countries. Then,
Country Y: Can produce 6 computers or 12
in June 1998, the European Central Bank was established
smartphones.
and, in January 1999, a unified currency, the euro, was
 COMPARATIVE ADVANTAGE - so long as the two
born and came to be used by most EU members
countries have different relative efficiencies, the two
THE EUROPEAN FINANCIAL STABILITY MECHANISM countries can benefit from trade the country with
(EFSM) absolute advantage will still benefit by directing its
 resources to those goods where it is most productive exported goods is a right of every Foundry Heavye
and trading for the others tariffsins for importede goods of their some local
Example: Country X has a comparative advantage industries. The prices of imported goods in local markets
in computers (lower opportunity cost). Country Y are inflated due to high imported taxes to ensure demand
has a comparative advantage in smartphones of local products.
(lower opportunity cost). Trade Benefits: By
SAFETY
specializing, Country X produces computers and
- This ensures that imported products in the country are of
Country try produces smartphones. They can then
high quality. Inspection regulations laid down by public
trade, allowing both to have more computers and
officials ensure the safety and quality standards of
smartphones than they could produce their own.
imported products.
2. TRADE POLICY
Key Points:
- The regulations and agreement of foreign countries
Purpose: To protect local industries from foreign
- It defines standards, goals, rules, and regulations that
competition.
trade relation between countries.
Types of Trade Barriers:
- Each country has specific policies formulated by its
o TARIFFS: Taxes on imported goods.
officials. Boosting the nation's international trade is the
o DUTIES: Fees imposed on certain goods when they
aim of each country. Taxes imposes on import and export,
inspection, regulations, tariffs and quotas are all part of cross borders.
country's trade policy. o SUBSIDIES: Financial support given to local
businesses to lower their costs.
FOCUSES OF TRADE POLICY IN INTERNATIONAL TRADE o EMBARGOES: Bans on trade with specific countries.
TRADE BARRIERS o QUOTAS: Limits on the quantity of a product that can
- These are measures that governments or public be imported.
authoritiesintroduce to make imported goods or services Example: If Country A imposes a 20% tariff on imported cars,
competitive than locally produced goods and services this means that foreign cars become more expensive, making
less. locally produced cars more appealing to consumers. As a
- They are state-imposed restrictions on trading al result, people are likely to buy more cars from Country A,
particular product or with a specific nation. It can be which helps local car manufacturers compete better against
linked to the product, service like technical requirement foreign brands.
and it can also be administrative in nature such as rules
and procedures of transactions. Tariffs, duties, subsidies, SAFETY REGULATIONS
embargoes and quotas are the most common trade
barriers

TARIFFS
- These are taxes or duties paid for a particular class of
imports or exports. Imposing taxes on imported and
 Example: If a country has strict safety regulations for - the guidelines and regulations established by
toys, imported toys must be inspected to ensure they international economic organizations to facilitate and
are free from harmful materials and meet safety regulate trade among countries. These policies aim to
standards. This helps prevent dangerous toys from balance the interests of both developed and developing
reaching children and ensures that consumers. can nations., such as Organization for Economic Co-operation
trust the quality of products available in the market. and Development (OECD), World Trade Organization
(WTO) and International Monetary Fund (IMF). The best
TYPES OF TRADE POLICIES interests of both developed and developing nations are
1. BILATERAL TRADE POLICY upheld by the policies.
- an agreement between two countries to facilitate trade
and economic cooperation. This often involves reducing TRADE POLICY AND INTERNATIONAL ECONOMY
tariffs, establishing trade quotas, and addressing other In most developed countries where open market economy
barriers to trade. prevails, the international economic organizations support
Example: U.S.-Mexico-Canada Agreement (USMCA): free trade policies. In the case of developing nations partially-
While it includes three countries, the USMCA serves as shielded trade practices are preferred to protect their local
a bilateral trade policy between the U.S. and Mexico, trade industries. The following are dependent on
as well as between the U.S. and Canada. globalization: sound trade policies for market changes,
establishment of free and fair trade practices and pansion of
Key Features:
possibilities for booming international trade.
o Reduction of tariffs on agricultural products, automobiles,
and other goods. THE WORLD TRADE ORGANIZATION (WTO)
o Provisions for labor rights and environmental standards. Trade Policy and International Economy
o Increased access for U.S. dairy producers to the Canadian Deals with the global rules of trade between nations with the
market. main function of ensuring that trade flows smoothly,
predictably and freely. It is the only global international
The agreement enhances trade relationships, promotes organization dealing with the rules of trade between nations
economic growth, and helps create a more balanced trade with WTO agreements, negotiated and signed by many of the
environment between the participating countries. world's trading nations and ratified in their parliaments at its
2. NATIONAL TRADE POLICY heart.
- the strategies and regulations that a government WTO is viewed as the means by which industrialized
implements to protect and promote its weitare of countries can gain access to the markets of
encompasses interests and the gens. This policy developing countries.
measures aimed at influencing international trade GLOBAL ECONOMY OUTSOURCING
practices An activity that requires search for a partner and relation
3. INTERNATIONAL TRADE POLICY specific investments that are governed by incomplete
contracts. The extent of international outsourcing depends on - It is the practice of assigning part of the obligations and
several factors: tasks under a contract to another party known as a
1. Market Thickness: The availability of suppliers in both subcontractor an especially prevalent in areas where
domestic and foreign markets. complex projects are the norm like construction and
2. Search Costs: The relative costs associated with finding information technology
suppliers in each market. Example: In a large construction project, a general contractor
3. Customization Costs: The expenses involved in may subcontract the electrical work to a specialized electrical
adapting inputs to meet specific needs. firm. This allows the general contractor to focus on overall
4. Contracting Environment: The legal and regulatory project management while ensuring that the electrical
conditions in each country that affect contract systems are handled by experts.
enforcement and reliability.
SUBCONTRACTING
Outsourcing Scenario: The company decides to outsource the - In bilateral relationships, activities are often governed by
production of its electronic components to a manufacturer in a contract. However, even with a legal document in place,
Vietnam. there is no guarantee that the partners will perform their
obligations with the same level of care and diligence that
Factors Influencing the Decision:
the firm would use if it were handling the tasks itself.
1. Market Thickness: Vietnam has a robust network of
Example: A company hires a subcontractor for a crucial part
electronics suppliers and manufacturers, making it easier
of a project. Despite having a detailed contract, the
to find partners.
subcontractor may not invest the same effort and resources
2. Search Costs: The firm finds that searching for suppliers
as the company would, resulting in delays or quality issues
in Vietnam is more cost-effective than in the U. S. due to
that affect the overall success of the project.
lower labor costs and established industry clusters.
3. Customization Costs: The Vietnamese manufacturer
One of the most rapidly growing components of international
has experience customizing electronic components to
trade is the outsourcing of intermediate goods and trusiness
meet the firm's specifications, reducing additional costs.
services. There are three essential teatures of a modern
4. Contracting Environment: Vietnam has made
outsourcing strategy
improvements in its legal framework for contract
1. Firms must search for partners with the expertise that
enforcement, giving the firm confidence in its ability to
allows them to perform the particular activities that are
secure and uphold agreements.
required
Outcome: By outsourcing to Vietnam, the U.S. company can 2. They must induce the necessary relationship- specific
reduce production costs, levera specialized expertise, and investments in an environment with incomplete
focus on its core business activities while ensuring time contracting
delivery of high-quality components. 3. They must convince the potential suppliers to customize
products for their own specific needs
OUTSOURCING
- A central element of the new economy Possible Determinants of the Location of Outsourcing
1. Size of the country can affect the "thickness of its markets harmed. their economies and societies, making them part of
2. The technology for search affects the cost and likelihood the Global South narrative.
of finding a suitable partier
THREE PRIMARY CONCEPTS OF GLOBAL SOUTH
3. The technology for specializing components determines
1. It refers to economically disadvantaged nation-
the willingness of a partner ta undertake the needed
states and as a post-cold war alternative to "Third
Investment in a Prototype
World"
4. The contracting environmenta can impinge on a firm's
- The term "Third World" is commonly used to refer to
ability to induce a partner to invest in the relationship
developing nations. It originated during the Cold War to
categorize countries that were neither aligned with NATO
and capitalism (the First World) nor with the Soviet Union
UNIT 3: THE WORLD OF REGIONS
and communism (the Second World).
LESSON 2.4 Global The Divides: North and the South
(focus: Latin America) Key Characteristics of Third World Countries:
o Economic Challenges: Third World countries are
GLOBAL SOUTH
often characterized as poor and underdeveloped.
- the regions of Latin America, Asia, Africa, and Oceania
o Social Issues: These nations typically face low levels
that predominantly consist of low- income countries.
These regions often face political and cultural of education, inadequate inf infrastructure, poor
marginalization, meaning they may not have the same sanitation, and limited access to healthcare
influence or representation in global affairs as more o Living Conditions: The living conditions in these
developed nations. countries are often considered inferior to those in more
Example: In Latin America, many indigenous communities developed nations.
face political exclusion and economic hardship, despite
having rich cultural traditions. Similarly, in parts of Africa, 2. The Global South captures a deterritorialized
certain nations may struggle with political instability and geography of capitalism's externalities and means
limited access to global markets, which affects their and to account for subjugated peoples within the
development. borders of wealthier countries, such there are
- countries that share histories of colonialism and neo- economic Souths in the geographic North and
imperialism, leading to significant inequalities in living Norths in geographic south.
standards, life expectancy, and access to resources. - The Global South represents a concept that goes beyond
- Contemporary critics of neo-liberal globalization use the geographical boundaries to address the effects of
term "Global South" to unite countries affected by harsh capitalism on marginalized communities. It highlights how
economic policies imposed by institutions like the there are economically disadvantaged groups (referred to
International Monetary Fund (IMF). as "economic Souths") even within wealthy (or
Example: For instance, countries like Greece and Argentina "geographic North") countries. Conversely, some areas in
have faced severe economic crises exacerbated by IMF- poorer countries (the "geographic South") can be
imposed austerity measures, which critics argue have economically prosperous (referred to as "Norths").
 Key Points: Resistant Imaginary: These workers may create a
o Deterritorialized Geography: The Global South collective identity that emphasizes solidarity against
focuses on the impacts of capitalism regardless of unfair labor practices, regardless of their geographical
geographic location. location.
o Subjugated Peoples: It aims to recognize and Transnational Political Subject: Organizations like
account for marginalized groups living within wealthier Global Workers Rights and campaigns such as #PayUp
nations. (which advocates for garment workers wages)
o Economic Disparities: This concept illustrates that exemplify this transnational political subject. subject.
economic inequalities exist in both rich and poor They bring together voices from different countries to
countries, challenging traditional notions of wealth advocate for fair labor standards, promoting unity
based solely on geography. among workers facing similar struggles.
Shared Experience of Subjugation: The shared
3. It refers to the imaginary resistant of a experience of low wages, unsafe working
transnational political subject that results from a environments, and lack of benefits underlines their
shared experience of subjugation under resistance to capitalist exploitation, fostering a global
contemporary global capitalism. movement that transcends national borders,

Key Points: The Global South isn't just about being geographically south
o Resistant Imaginary: the shared vision or identity of wealthy countries (the Global North). Instead, it's a
tity formed by people who resist or oppose the symbolic term that represents the shared experiences and
negative impacts of global capitalism. unity of countries that were once colonized.
o Transnational Political Subject: individuals or Not a Fixed Direction: The Global South doesn't refer to a
groups who identify as part of a larger, interconnected specific location on a map; it's more about the relationships
movement that transcends national boundaries, driven and histories of these countries.
by their shared experiences of subjugation.
o Shared Experience of Subjugation: The concept Globalization challenges traditional ideas about poverty and
emphasizes that many people around the world have inequality based on geography. It shows that both wealth and
faced similar struggles and injustices due to the forces poverty can exist in various locations, regardless of whether
of global capitalism, fostering a sense of unity and a country is classified as developed or developing. For
resistance among them. instance, affluent areas in developing countries may mirror
the wealth of the Global North, while impoverished
A dear example of this concept can be seen in the global neighborhoods in wealthy nations reflect the poverty seen in
labor movement. Workers from various countries, such as the Global South. This interconnectedness highlights that
those in garment factories in Bangladesh, tech workers in the economic disparities are not strictly tied to geographical
United States, and agricultural laborers in Brazil, share a boundaries.
common experience of exploitation and poor working
conditions due to the demands of global capitalism.
The development of the global south must begin by drawing As global problems increase, it is necessary for people in the
most of the country's financial resources for development north to support people from the south. As a symbol and
from within rather than becoming dependent on foreign metaphor global south
investments and foreign financial markets
The global in global south does not only mean that the south
The Global South is significant not only for the countries is the globe but also signifies that the south continues to be
typically associated with it but also highlights that these globalized.
regions are actively participating in globalization. It
The Global South, while rooted in particular geographic
symbolizes new forms of progressive cosmopolitanism, where
contexts, embodies new and evolving forms of progressive
diverse cultures and ideas connect across borders. This
cosmopolitanism. It reflects an ongoing and adaptable sense
concept reflects an ongoing and evolving sense of
of internationalism, emphasizing the importance of
internationalism, emphasizing collaboration and solidarity
collaboration and solidarity among diverse. cultures and
among nations as they navigate the complexities of a
nations. This dynamic nature allows the Global South to
globalized world.
continually shape its identity, and engage with global issues
NEW INTERNATIONALISM IN THE GLOBAL SOUTH in meaningful ways.
The challenges faced by the Global South are increasingly
ASIAN REGIONALISM
becoming global issues. During the 1980s, underdeveloped
REGIONALISM
states in this region were severely impacted by harsh policies
- Decentralization, which is the process of redistributing
imposed by the International Monetary Fund (IMF). These
or transferring authority, responsibilities, and decision-
economic measures, often viewed as remedies, have been
making powers from a higher political level (such as a
repeatedly recommended for countries in the Global South,
national government) to a lower level (such as local or
but they can exacerbate existing problems rather than
regional governments). Decentralization aims to bring
provide effective solutions. This highlights how the negative
governance closer to the people, allowing for more
effects. of globalization and economic policies can extend
localized decision-making and potentially increasing the
beyond borders, affecting vulnerable nations worldwide.
responsiveness and accountability of government actions.
A similar globalization of concerns from th Global South is
Globalization is the intensification of economic political,
emerging around the issue of the global environment. In the
social, and cultural relations across and borders
face of the existential threat posed by climate change, some
consciousness of that intensification,v with a dimcutiomth
of the most radical ideas about climate justice are being
the significance of territorial boundaries.
developed in the Global South. These perspectives
emphasize the need for equitable solutions that address the VIEWS OF GLOBALIZATION IN THE ASIA PACIFIC AND
disproportionate impacts of climate change on vulnerable SOUTH
populations in these regions, highlighting the importance of Globalization is often viewed as an external force introduced
global solidarity in tackling environmental challenges. into regions like Asia Pacific and South Asia by major world
powers, particularly the United States and Europe. From this
perspective, globalization is seen as a transformative process
that promotes economic development, political progress, and India and Indonesia are included as important emerging
increased social and cultural diversity in these areas. powers in the Asia Pacific region for several reasons:
Advocates argue that it can lead to positive changes and o Economic Growth: Both countries have experienced
opportunities for growth, improving the overall quality of life significant economic growth in recent years. India is one
in the region. of the fastest-growing major economies in the world,
while Indonesia has the largest economy in Southeast
THE ASIA PACIFIC AND SOUTH ASIA
Asia, making them crucial players in regional and global
- Refer together to the regions of East (or Northeast) Asia,
markets.
South Asia, the Pacific Islands, and South Asia. It includes
o Political Influence: Both countries play influential roles
some of the world's most economically developed states
in regional organizations. India is a key member of
such as Japan, South Korea, Singapore, and Taiwan, and
organizations like the South Asian Association for Regional
highly impoverished countries such as Cambodia, Laos,
Cooperation (SAARC) and the Association of Southeast
and Nepal.
Asian Nations (ASEAN) as a dialogue partner. Indonesia,
- It also includes the largest and most populous states on
as the largest member of ASEAN, is pivotal in fostering
the globe including China and India and some of the
regional cooperation and stability.
world's smallest such as the Maldives and Bhutan

Has emerged over the past decade as a new new political SUBTOPICS: GLOBAL DIVIDES AND ASIAN
force in the world. The economies of Japan, Korea. Indonesia, REGIONALISM
Vietnam and Pakistan have strategic relevante in today's
ASIA PACIFIC AND SOUTH ASIA'S IMPACT ON
global system. They are the focused of global powers outside
GLOBALIZATION
of the region
Asia was the central global force in the modern world
- The "Pacific Pivot" refers to a foreign policy shift by the economy early
United States aimed at dedicating more resources and - It was the site of the most important trade routes and in
attention to the Asia Pacific region. Coined during the some places more advanced in technology than West
Obama administration and articulated by Secretary of such as science and medicine.
State Hillary Clinton, this strategy recognized the Asia - Colonies in the Asia pacific and South Asia influenced the
Pacific as a crucial player in global politics, leading to its West and vice versa. They were often "laboratories of
designation as the "Pacific Century." The pivot reflects the modernity"
growing importance of this region in economic, political, - Colonialism wasn't just about European countries
and security matters on the world stage, as the U.S. asserting dominance over Asian regions. It was also about
sought to strengthen its partnerships and influence in shaping what we now consider "modern." Ideas of
response to emerging challenges and opportunities. governance, education, law, and economy that came from
- It is the home to several key allies and important these colonial experiences have influenced what we think
emerging powers like China, India, and Indonesia. of as modern Western practices. For instance, modern
banking, law systems, and infrastructure development
 were often trialed and adapted in colonial regions before CULTURAL INFLUENCE: In addition to trade, China's
being implemented in Europe. culture is increasingly influential in the West. For
instance, Chinese apps like TikTok have a massive
1. Japan embarked on procuring raw materials like coal global user base, impacting social media culture
and at unprecedented economies of iron scale allowing worldwide. In turn, Western brands and cultural
them. to gain a competitive edge in the global practices also continue to influence China, showing
manufacturing market as well as globalized shipping that this exchange of ideas and products still exists,
and procurement patterns which other countries just like it did during colonial times, but in a more
modeled. balanced way.
2. China pursues similar pattern of development at This modern example of China and its interaction with the
present now is the world’s largest importers of basic global economy reflects how Asia continues to play a crucial
raw materias such as iron and surpassed Japan, the US role in shaping what is considered "modern" in today's world.
and Europe in steel production. It also surpassed the It echoes how colonialism and historical trade routes led to
World bank in lending to developing countries. It had an exchange of ideas and practices between East and West.
an enormous impact on the availability and
consumption of goods around the world (135). This THE REGION-MAKING IN SOUTHEAST ASIA AND
simple scale of China's development is shaping and MIDDLE- CLASS FORMATION: THE THIRD WAVE
furthering globalization. Regionalization entails complex and dynamic
3. India opened up and emphasized an export-oriented interactions between and among governmental and
strategy. Textiles and other low wage sectors have non-governmental actors which resulted to hybrid
been a key part of the economy with highly successful East asia
software development exports. It also plays a key role The main engines of hybridization are explained by the
in global service provisions as trends in outsourcing These waves of economic development were driven by
and off-shoring increase. "developmental states" (countries that actively help
their economies grow, like South Korea or Singapore)
Let's consider China and the West today:
and by "capitalism" (national and international
TRADE AND TECHNOLOGICAL EXCHANGE: China is
businesses that invest and create. wealth).
now one of the world's largest economies and a leader
Because of this economic growth, many countries in
in technological development. For example, Chinese
these regions have developed large middle-class
companies like Huawei and Alibaba are global giants,
populations-people who are neither poor nor extremely
Influencing everything from smartphones to e-
rich. These middle-class groups, even though they
commerce. There's a modern-day exchange
come from different countries, have a lot in common.
happening-just as in the past where China and the
They tend to have similar jobs and lifestyles, and they
West are influencing each other. While China imports
enjoy the same types of fashion, entertainment, and
technology and ideas from Western countries, it also
leisure activities. They also share similar hopes and
exports its own innovations, shaping global markets.
dreams for the future.
 1. US-LED SECURITY SYSTEM: The U.S. formed
KEY POINTS: alliances with countries like Japan, South Korea, and
1. Economic growth has led to the rise of the middle class Taiwan, providing them with military protection and
in many countries. political support. This allowed these countries to focus
2. Middle-class people in different countries may live in on building their economies without worrying about
separate societies, but they have many similarities in threats.
how they live their lives and what they aspire to. 2. TRIANGULAR TRADE SYSTEM: There was a trade
3. These middle-class populations are important because relationship between Asia, the U.S., and Europe. Asian
they drive consumer markets by spending money on countries exported goods (like electronics and clothes)
goods and services, which helps the economy grow. to the U.S. and Europe, while importing technology
An example of this can be seen in Southeast Asia. and investments to help their own economies grow.
Countries like Malaysia, Thailand, and Vietnam have seen Example: After World War II, countries like Japan and South
strong economic growth over the past few decades, and this Korea received help from the U.S. for security and economic
has led to the rise of a large middle class population. People development. This led them to become major exporters of
in these countries now have more disposable income, which products like cars and electronics to the U.S. and Europe,
they spend on products like smartphones, branded clothes, while also benefiting from technology and investments from
and entertainment such as movies and music streaming those regions. This relationship helped boost their
services. economies.

The product of regional economic development in the The first wave of regional economic development took
post war era are the middle classes in east Asia. place in japan from mid-1950's to the early 1970s and
 Regional economic development took place within - This led to the emergence of a middle-class by the early
the context of the American informal empire in 1970s. The second wave took place between the 1960s
"Free Asia", with the US-led regional security and 1980s in South Korea, Taiwan, Hongkong and
system and the triangular trade system as its Singapore and led to the formation of middle class
two major pillars. societies in these countries by the 1980s.
 Furthermore, the governments in the region,
whether democratic or authoritarian, actively TWO SALIENT POINTS IN THE HISTORY OF EAST ASIAN
supported economic growth. They focused on MIDDLE- CLASS FORMATION
increasing productivity and turning political issues 1. In Southeast Asia, the middle class. grew because
into economic goals. These governments tried to global and regional businesses worked together with
reduce conflicts between social classes by local governments. In Japan, South Korea, and Taiwan,
encouraging everyone to agree on the importance the middle class was formed by governments that
of growing the economy. focused on development economic and businesses
within their own countries.
TWO MAIN FACTORS HELPED THIS GROWTH:
 2. New middle classes in East Asia (places like Japan, Example:
South Korea, Taiwan, and Southeast Asia) have In the Philippines, the government has encouraged foreign
developed their own unique lifestyles because of their companies to invest in the country. As a result, businesses
better jobs, higher education, and increased income. like BPOs (Business Process Outsourcing), which
These middle- class people now live differently, provide customer support for intemational companies, have
enjoying things like better housing, more leisure flourished. These businesses serve both local and global
activities, and improved living standards that match markets, with many companies from countries like Japan and
their new income and social status. South Korea partnering with or investing in Philippine
businesses. This has strengthened economic ties between
MIDDLE CLASSES IN THE PHILIPPINES the Philippines and its neighboring countries in Asia.
New urban middle classes emerged in the post 1986
Philippines REGIONAL IMPLICATIONS OF MIDDLE CLASS
- Fostered by FORMATION IN EAST ASIA
government policies - The new urban middle classes were shaped by a variety
like liberalization of historical factors. They are the result of regional
(opening up the economic growth over the past 50 years, influenced by
economy) and the U.S., starting in Japan and then spreading to countries
deregulation like South Korea, Taiwan, Hong Kong, Singapore, Thailand,
(removing strict Malaysia, Indonesia, the Philippines, and now China.
rules), have helped These middle classes also developed because of strong
new businesses government policies focused on economic growth.
grow. These - Their lifestyles have been shaped in very complex ways
businesses are by their appropriation of things American, Japanese,
focused on both Chinese, South Korean, Islamic and other ways of life,
exporting products often mediated by the market.
to other countries - The political consequences of the rise of East Asia middle
and serving the local classes vary. The cultural and political hegemony of the
market. They also South Korean middle classes is embodied by single
get investment from generation, while that of the Taiwanese middle classes
many different foreign sources and use flexible manifest itself in the political assertiveness of an ethnic
partnerships like subcontracting (hiring outside majority. Southeast Asian middle classes also exemplify
companies), franchises, and service agreements. the diversity and complexity of class formation.
There has been a noticeable increase in the connections
between the Philippines and other countries in East and Comparison of middle classes in Thailand, Malaysia,
Southeast Asia through these business relationships. Indonesia, and the Philippines:
 THAILAND’S MIDDLE CLASS: They are socially
united, culturally dominant, and gaining political
power.
 MALAYSIA AND INDONESIA’S MIDDLE CLASSES:
They are socially divided, rely on the government, are
politically active, but also vulnerable to changes in
power.
 PHILIPPINE MIDDLE CLASS: They are socially united,
not as reliant on the government, culturally influential,
but tend to be inconsistent or indecisive