Economic Globalization by Nauman Khan

1. Economic
Globalization
By: Nauman Khan
Assigned by: Sir, Ramazan Azhar

2. Globalization:
Globalization is a process of interaction and integration among the
people, companies, and governments of different nations, a process driven
by international trade and investment and aided by information
technology.
The term “Global Village” by McLuhan.
( Globalization is the product of Society being increasingly ‘Mediate’).
Bauman sees ‘Winners and Losers’ in the process, reminding us of the
crucial fact that more people are excluded from the Global Village than are
included. (Less than 20% people have access to Internet) “Global Digital
Divide”.

3. Globalization:
Globalization is dynamic process by which nations and economies
around the world become more interdependent. Globalization is not
strictly an economic phenomenon: Social, cultural, and political
convergence, such as the formation of international institutions (i.e., the
World Bank or United Nations), has played an important role in fostering
global interdependence.
Economic globalization is not an entirely new phenomenon; but with the
developments in information and communication technology (ICT)
have increased the speed of globalization in the latter part of the 20th
century.

4. Role of ICTs in Globalization:
Electronic Colonialism Theory: by Tom McPhail.
“Explains how Mass Media are leading to new concept of Empire (Empire
of the Mind). It focuses on the global media influence on how people
think and act.”
World System Theory: Immanuel Wallerstein.
A macro-sociological theory that seeks to explain the dynamics of the
“Capitalist world economy” as a “total social system”.
This theory states that global economic expansion takes place from a
relatively small group of core-zone nation-states out to two other zones
of nation-states, these being in the semi-peripheral and peripheral
zones.

5. Economic Globalization:
Economic Globalization, the term, first proposed by Levy 1985.
The trans-national Increase in trade and capital transfer across national
boundaries.
The word “trans-national” and the phrase “across national
boundaries” also need explanation. The world has always known
international trade, but what makes economic globalization different is
that nations are coming to play a smaller and weaker role in it.
Modern trans-national corporations have offices and production facilities
in a dozen countries and swear allegiance to none of them.

6. Economic Globalization:
Modern Multinational corporations are increasingly “stateless,” as they
answer to no one, and have economies larger and more powerful than
many of the countries that host them. They make their own
international trade policy, intervene in national policy, and use
campaign contributions to sway the votes of politicians. These
corporations are undemocratic, secret societies, and apparently prefer to
do business in undemocratic countries.

7. Forms of Economy
Protectionism VS Trade Liberation.
Protectionism: Protecting one’s economy from foreign competition by
creating trade barrier;
 High custom duty,
 Limit import products,
 Ban import product.
Trade Liberation (Free Trade); reducing trade barriers for easy global
trade.

8. Institutions of Economic Globalization:
Bretten Woods Conference/Agreement:
During WWII, 44 allied countries met to talk about the aftermath of the
economy after the war.
Established a set rules, including new ideas for the global economy.
Some institutions have been originated after this conference:
IMF, World bank, World Trade Organization.
NIEO (New International Economic Order)
NWICO (New World Information and Communication Order).

9. Institutions of Economic Globalization:
OECD (Organization for Economic Cooperation and Development);
attempts to forecast macroeconomic developments on behalf of the
30 member countries, which produce two-thirds of the world’s goods
and services. In a way, OECD is a think-tank for core and some semi
peripheral nations. It provides them with expert advice on how to further
frame and expand international trade rules so that the cooperation among
member nations as well as others increases and creates a stable and
expanding global economy.

10. Advantage and Disadvantages of Economic
Globalization.
Advantages
• Free trade
• Cheap Production.
• Economic Growth
• Increased the standard of life.
• Access to new and efficient
market.
• Increased Competition
Disadvantages
• Harmful effects on small
Industries and Small Business.
• Global Warming.
• Underpayment of Workers in
Developing Countries.
• Encourages dependence on other
countries.