Module 2 – THE STRUCTURES OF GLOBALIZATION -Topics 1. The Global Economy & Market Integration 2. Role of International Financial Institution in the Creation of a Global Economy 3. The Global Interstate System and Contemporary Global Governance

1. THE STRUCTURE OF GLOBALIZATION
BY: ARNEL G. PEREZ, MS

2. • The Global
Economy
• Market Integration
• The Global
Interstate System
• Contemporary
Global
Governance
THE STRUCTURE OF GLOBALIZATION
Intended Learning Outcomes:
• Define the following concepts such as economic
globalization; market integration; modern world system;
and contemporary global governance
• Explain the effects of globalization on governments and
differentiate internationalism and globalism
• Explain the roles and functions of the United Nations;
challenges of global governance in the twenty-first
century; and the relevance of the state amid globalization

4. •Global economy or economic
globalization refers to the increasing
interdependence of world economies as a
result of the growing scale of cross-border
trade of commodities and services, flow of
international capital, and wide and rapid
spread of technologies (Shangquan, 2000).

5. •Global economy or World economy refers
to the international exchange of goods and
services through the use of monetary units of
money
•Global economy means the free movement of
goods, capital, services, technology, and
information
•Global economy or economic globalization is
concerned on the globalization of production,
finance, markets, technology, organizational
regimes, institutions, corporations, and labor

6. Globalization of Production Globalization of Finance
Globalization of Markets
Globalization of Technology
Globalization of Organizational Regimes
Globalization of Corporation
Globalization of Labor

7. • Globalization of Production refers to
the sourcing of goods and services
from location around the globe to take
advantage of national differences in
the cost and quality of factors of
production like land, labor and capita
• Outsource - obtain (goods or a
service) from an outside or foreign
supplier, especially in place of an
internal source
• Business Process Outsourcings or
BPOs (Call Center Agencies)
Globalization
of Labor

8. Increase job
opportunities
Upgrade education
system and leads
to more training
Increase labor
standard
Increase labor
productivity
Pressure firms to
correct labor
abuses
Effect of
Globalization
on Labor
Conditions

9. • Globalization of Technology refers to the
global exploitation of technologies through
the patents (a government authority or license conferring
a right or title for a set period, especially the sole right to exclude others
from making, using, or selling an invention) and licenses
• The global sourcing of research and
development (R&D) through alliances and
joint ventures with foreign companies or
universities through the implication of
technologies
• The global production of research and development through
overseas subsidiaries.
Digital World

10. •Financial Globalization refers to:
•The liberation of trade in financial
assets
•It is the flow of capital and
corporate investments between
various countries
•World allocation of money leading
to exchange of services and goods
•International Monetary Funds (IMF)
•World Bank

11. • Globalization of Corporation refers to a company or group of people
authorized to act as a single entity and recognized as such law that
operates globally or internationally
• Global corporation refers to a company or corporation that operates
in more than one country which has significant investments and
facilities in multiple countries but lack dominant headquarters
• Global business (as mentioned by Michael Porter) refers to
business that maintains a strong headquarters in one country, but
has investments in multiple foreign location.
• International company is one that has headquarters likewise it does
business overseas and might have a large presence in multiple
areas.
• Multinational company/ corporation (Coca Cola/ Pepsi/ Samsung/ Apple/ Nestle/ Lacoste/
Penguins/ Guess/ Nike/ Gap)

12. Globalization of Markets
• Globalization of markets refers to
the process of integrating and
merging of the distinct markets into
a single market
• This involves the identification of
some common norms, value, taste,
preference and convenience and
slowly enables the cultural shift
towards the use of common
product or service.

13. Globalization
of
Markets

14. Broader access to wider variety of
products and services than
neighborhood offers
Greater vendor diversity leads to
better buying opportunities lower
prices; eg. Comparison shopping
via internet
Lost allegiance to domestic
producers
More volatile labor market with
stronger competition from global
labor supply
Impact of
Globalization
on
Consumers

15. International
Financial
Institutions
(IFIs)
They are chartered by more than one country and they are subjects to
international law
The owners or shareholders are generally national governments
The first IFIs are established after the WWII to assist in the reconstruction
of Europe and to provide mechanism for international cooperation in
managing the global financial system
European Investment Bank

16. INTERNATIONAL
FINANCIAL
INSTITUTIONS (IFIs)
Multilateral
Development
Banks (MDBs)
World Bank Group
African Development
Bank
Asian Development
Bank
Inter-American
Development Bank
European Bank for
Reconstruction and
Development
International
Monetary Bank
(IMF)
Global in Scope
Regional
Development Banks

17. Market Integration refers to:
• Prices among different location or related goods
follow the same patterns over a long period of
time
• Group of prices that often moves proportionally
to each other and relation is very clear among
different markets
• Thus, it can be concluded that market integration
is an indicator that explains how much different
markets are related to each others
 A situation in which separate markets for the
same product become one single market.

18. • Between 1882 and 1936 – labor market
integration occurred in the area of Asia
extending from South India to Southeastern
China and encompassing the three
Southeast Asian countries of Burma, Malaya,
and Thailand
• Late 19th century – mass migration of Indians
and Chinese to Southeast Asia gave rise to
both integrated Asian labor market and
period of real wages convergence (divergent
trends in unskilled real wages)
Brief Historical
Background of
Global Market
Integration in
the 20th
Century

19. • 1880s – steamships had largely replaced sailing
vessels for transport within Asia as well as to
Western markets (shipping fares had begun to fall)
• 1880s – mass migration of Indian (Mandras, India),
and Chinese workers (provinces of Guandong, Fukien,
and Southeast Asia)
• Burma, Malaya, and Thailand are the chief
immigrant-receiving countries in Southeast Asia
• Late 19th century (early 20th century) – global
migration movement/ European immigration.
Brief Historical
Background of
Global Market
Integration in
the 20th
Century

20. STATE
• Body of people politically organized under a
government within a definite territory.
• A nation or territory considered as an organized
political community under one government
• Organization of political positions and
the structure of political relation in
• society.
• World
• A community of persons, more or less
numerous, permanently occupying a definite
portion of territory, independent of external
control, and possessing an organized
government to which the great body of
inhabitants render habitual obedience.
Global Interstate
System

21. WORLD-SYSTEM
• It refers to existence of the division of labor
• It deals with inter-regional and transnational division of labor, which divides
the world into:
 Core countries
 Semi-periphery countries
 Periphery countries
• Modern world-system has a multi-state political
structure (interstate system). Thus, the division of labor
are considered international/ global division of labor
• GLOBAL INTERSTATE SYSTEM – means:
 Multi-state political structure and
 the international or global division of labor of the core, semi-periphery, and periphery countries
World System
• World System Theory (World Systems Analysis/ World
Systems Perspectives – is a multidisciplinary, macro-
scale approach to the world history and social change
which emphasizes the world-system as the primary unit
of social analysis

22. Global Interstate
System
World System
• CORE COUNTRIES
Higher Skills
Capital Intensive Production
Core
Countries
Core Countries
Semi-Periphery
Countries
Periphery Countries
• SEMI-PERIPHERY/ PERIPHERY
COUNTRIES
 Low Skills
 Labor Intensive Production
 Extraction of Raw Materials

24. Contemporary Global
Governance
• World Governance
Movement towards political
cooperation among
transnational actors, aimed at
negotiating responses to
problems that affect more than
one state or region
• Institution of Global Governance
United Nations
International Criminal Court
World Bank
 These have limited
or demarcated
power to enforce
compliance

25. •Functions of United Nations
The main function of UN is to
maintain peace and security for all of
its member-states.
The UN does not have its own
military but it has peacekeeping force
which are supplied by the member
states
The UN aims to protect human rights
and provide humanitarian assistance
when needed
Institution of Global Governance
United Nations

26. •Functions of United Nations
The UN plays an Integral part in social
and economic development through its
UN Development Program
The UN likewise annually publishes the
Human Development Index to rank
countries in terms of poverty, literacy,
education, and life expectancy
UN General Assembly – occupies the
central position as the chief deliberative,
policymaking, and representative
organs of the United Nations.
Institution of Global Governance
United Nations

27. •Functions of United Nations
The UN plays an Integral part in social
and economic development through its
UN Development Program
The UN likewise annually publishes the
Human Development Index to rank
countries in terms of poverty, literacy,
education, and life expectancy
UN General Assembly – occupies the
central position as the chief deliberative,
policymaking, and representative
organs of the United Nations.
Institution of Global Governance

28. • Climate Change, Poverty, Violent
Conflict, Intolerance, and
Extremism present direct threats
to the unity and well-being of the
International or Global Community
• Attacks on cultural rights and
cultural heritage, particularly in
Syria, Iraq, and Mali threaten the
Inter-Cultural Tolerance
Challenges of Global
Government in the 21st
Century
(Irina Bokova, Director General of UNESCO, 2016)

29. • First, openness of mind and out-of-box thinking is crucial.
New ideas must be transformed into norms (Efforts to
teach people about the history of the Holocaust/ program
promoting internet literacy/ help to instill common values
to the youth/ create environments that are conducive to
respectful dialogue)
• Second, the international community must build resilient
societies (Fighting exclusion and fostering inclusion/
Participation of women in all sectors)
• Third, new thinking about peacebuilding. (The world
urgently needs legitimate and effective peace efforts,
before, during, and after conflicts. Preventive measures
are key and must involve the soft power embodied by
UNESCO’s educational and inter-cultural program)
3 Points to Address the
Challenges of Global
Government in the 21st Century
(Irina Bokova, Director General
of UNESCO, 2016)

30. Globalization
Internalization
VS

31.  Globalization refers to global
economic integration of
many and formerly national
economies into one global
economy – mainly by free
trade and free capital
mobility.
 Globalization refers to the
interconnectedness of
people and business across
the world that eventually lead
to global, cultural, political,
and economic integration
 Global means worldwide
 Internalization refers to the
increasing importance of
international trade,
international relations,
treaties, alliances and others
 International means between
or among nation
 Globalism refers to the
operation or planning of
economic and foreign policy
on a global basis
VS

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