CONTEMPORARY WORLD

MODULE 2

THE STRUCTURES OF GLOBALIZATION

Module Introduction:

Have you heard the phrase ―When the American economy sneezes, the rest of the world catches a cold? This
means that world economies have been brought together by globalization. But it is important to remember that it is
not just the economy of United States that has the significant impact and global market and finance. This is clear, for
example, in the global impact of financial that crisis that strike Asia and Russia in the 1990‘s. However it remains the
case that the more powerful the economy, the greater the effect of its crisis on the rest of the world. In the same
manner, crises on weaker economies have less effect on other countries. For example, Argentina‘s serious financial
crisis in the late 1990‘s and 2000‘s has a comparatively small impact on the global economy. This shows the
contribution of different financial and economic institutions facilitated the growth of the global economy. As we
discuss the history of the creation, interaction, and characteristics of these institutions, we will able to see their
significance. We will also take a look at the multinational that are emerging in today‘s world economy.

Moreover, while globalization has led to the convergence of more developed economies, many argue that the
welfare gap between the more and less developed economies is growing. ‘Global economics’ looks at how trade has
shaped the global economy and considers the costs and benefits of free trade – it also provides an analysis of the
major problems facing the global economy in the 21st Century, and provides an analysis of the financial crisis.
Globalization has, however, enabled powerful multinationals to avoid taxes by employing complex tax systems. The
implications of Covid-19 pandemic for the global economy are also considered.

The focal concern in this chapter is the political structures involved in globalization. However, these structures, like
all structure, are often better seen as flows or as encompassing sets of flows. For example, a nation-state or a
bureaucracy is often thought of as a structure, but in the main it is the sum of the processes that take place within it.
To put this way, structures can be seen as ―congealed flows. In that sense, the bulk of this chapter also deals with
political processes (and flows). However, before we get to our focus on political structures, we need to be more
explicit about the political flows themselves.

THE GLOBAL ECONOMY

Specific Learning Outcomes:

During the students' learning engagements, they will be able to:

•Express understanding of the global economy with the use of editorial cartoons to explore the role of illustrated
commentary in society over time.
•Analyze and explain the actors that facilitate economic globalization through the articulation of facts based on
research and online articles.
•Create a TED presentation designed to creatively illustrate the modern world system
•Articulate a stance on global economic integration
•Create an essay regarding the good or bad impact of the Covid-19 pandemic on our Economy.

LEARNING ACTIVITIES

OPENING GUIDE QUESTIONS (5-minute Free Form formative assessment)

1. What is Global Economy all about? Is it a concept that all people can relate to?
2. Who and what is included in the Global Economy?
3. If you are asked to define the modern world system, how would you describe it?
4. What could be the goals of all economies in constructing the modern world system?
5. If these goals are met, how come there is a great divide between the developed countries and the
developing countries in the world today?

Engaging Activity 1:

Editorial Cartoons of the Present Global Economy (30 minutes)

(Outcome 1: Express understanding of the present global economy through an editorial cartoon)

Instruction: In the former module, the basic concept of globalization and what it is all about has been discussed. In
this module, we will start with the use of an editorial cartoon that will allow us to explore our understanding of the
global economy. Students should be able to define, explain, and describe the present scenario of the global economy
in terms of Asian and Western contexts.

Ask the students if they know what an editorial cartoon is. It’s a drawing that expresses a certain message or
viewpoint. Ask them why they think editorial cartoons exist. Why not just use words to convey an opinion? Let the
students answer.

By now, students are ready to answer the following questions: SEE- THINK – WONDER

1. What Do I SEE? (observations only)

2. What Do I THINK? (connect observations to prior knowledge) (Make inferences)

3. What Do I WONDER? (formulate questions/ queries)

Criteria:

• 10 points max (per group) – Clearly and accurately depicts the picture and demonstrates an understanding
of it.
• 5 points max – Clearly describes the picture and is free of errors.

Activity Processing:

1. How do you find the activity?

2. Why do you think the activity was done using Editorial Cartoon to explain the global economy as a concept? Was it
helpful?

To give everyone an insightful idea about the task, look at, and analyze the images and multimedia below which are
related to the concept of the global economy again. This time includes in the discussion about the visual symbols and
metaphors used, the irony in words and images, the source, the occasion that the cartoon was illustrated, etc.

https://coreybradshaw.files.wordpress.com/2010/11/drowning-in-shit.jpg

https://mizzouthinkglobal.files.wordpress.com/2015/02/povertyreductiontanzania-cartoon.jpg

https://www.observerbd.com/details.php?id=177299

https://www.cartoonistgroup.com/subject/The-Global+Economy-Comics-and-Cartoons.php

https://www.cartoonistgroup.com/cartoon/Lisa+Benson%27s+Editorial+Cartoons/2020-04-30/182988

Lesson Proper

What does the Global Economy mean?

A global economy is an economic interdependence established between the most influential countries that drive the
worldwide economic environment. It is also the aggregate economic output, movement, and influence of all
countries. The global economy can also be defined as each country’s economy added together but that is not the
only way to portrait how the world economy works.

Production Networks in The Global Economy

In the 1990s, a new framework, called GLOBAL COMMODITY CHAINS (GCC), tied the concept of the value-added
chain directly to the global organization of industries (see Gereffi and Korzeniewicz 1994; Gereffi 1999, 2001). This
work was based on an insight into the growing importance of global buyers (mainly retailers and brand companies,
or ―manufacturers without factories‖) as key drivers in the formation of globally dispersed production and
distribution networks. Gereffi (1994a) contrasted these buyer-driven chains to what he termed producer-driven
chains. The trade data alone mask important organizational shifts because they differentiate neither between
intrafirm and interfirm trade nor between the various ways in which global outsourcing relationships were being
constructed.

A variety of overlapping terms has been used to describe the complex network relationships that make up the global
economy. Each of the contending concepts, however, has a particular emphasis that is important to recognize for a
chain analysis of the global economy:
Supply chains. A generic label for an input-output structure of value-adding activities, beginning with raw materials
and ending with a finished product International production networks. A focus on the international production
networks in which TNCs act as ―global network flagships‖ (Borrus, Ernst, and Haggard 2000)

Global commodity chains. An emphasis on the internal governance structure of supply chains (especially the
producer-driven vs. buyer-driven distinction) and on the role of diverse lead firms in setting up global production and
sourcing networks (Gereffi and Korzeniewicz 1994) French ―filière‖ approach. A loosely-knit set of studies that used
the filière (i.e., channel or network) of activities as a method to study primarily agricultural export commodities such
as rubber, cotton, coffee, and cocoa (Raikes, Jensen, and Ponte 2000)

Global value chains. Emphasis on the relative value of those economic activities that are required to bring a good or
service from conception, through the different phases of production (involving a combination of physical
transformation and the input of various producer services), delivery to final consumers, and final disposal after use
(Kaplinsky 2000; Gereffi and Kaplinsky 2001)

Rise and Shine – In a twitter-like context, students are asked to capture the essence of the significant points of the
lesson in 1-3 minutes. Students may collaborate with the same groupings. When selected students are ready, they
individually stand up and share their summary/ insights gained from the activity with their classmates. (10 minutes
engagement)

Engaging Activity 2: In the Voice of…

(Outcome 2: Analyze and explain the actors that facilitate economic globalization)

In the Voice of…. Student thinking and imagination can be expanded when students consider how a person they
have studied might react to different or new situations from their perspective or point of view. In each group, a
member could take the role of a political leader or president, a laborer, a consumer, an entrepreneur/ an investor,
etc. and explain in 1-2 sentences their role as actors that facilitate economic globalization.

For Group Discussion: Who is involved in the making of the global economy? Can you name the actors that facilitate
economic globalization? What are their main goals in constructing this economic system?

Instruction: Work and brainstorm within the same groups then present to the class your answer to the essential
question. You may use print and online scholarly resources to add up to your discussion outcomes but make sure
that all references you use will be cited by the end of your presentation. This time let your 2nd member explain your
output for this activity.

Groups will be rated through the following criteria:

• 20 points max (per group) - factual, complete, accurate, concise, comprehensive, and efficient relay of ideas.

• 20 points max (each member) - the level of participation to the group discussion and knowledge
construction... to be identified by the group members themselves

Activity Processing:
2. How did you find the activity? What or how did you feel upon contributing to the success of your group and
upon accomplishing the task?

To know more about the task given, visit the following links: (10 minutes learning engagement)

https://www.youtube.com/watch?v=aemiFHJXrHI

https://www.thoughtco.com/the-governments-role-in-the-economy-1147544

https://people.ucsc.edu/~rlipsch/migrated/Folder%20for%20Shawn/Lectures/Structure%20of%20the%20global
%20economy.pdf

Factors that Have Contributed to Globalization

• https://www.tutor2u.net/business/reference/factors-that-have-contributed-to-globalisation

Containerization

The costs of ocean shipping have come down, due to containerization, bulk shipping, and other efficiencies. The
lower unit cost of shipping products around the global economy helps to bring prices in the country of manufacture
closer to those in export markets, and it makes markets more contestable globally

Technological change

Rapid and sustained technological change has reduced the cost of transmitting and communicating information –
sometimes known as “the death of distance” – a key factor behind trade in knowledge products using web
technology.

Economies of scale

Many economists believe that there has been an increase in the minimum efficient scale (MES) associated with some
industries. If the MES is rising, a domestic market may be regarded as too small to satisfy the selling needs of these
industries. Many emerging countries have their transnational corporations

Differences in tax systems

The desire of businesses to benefit from lower unit labor costs and other favorable production factors abroad has
encouraged countries to adjust their tax systems to attract foreign direct investment (FDI). Many countries have
become engaged in tax competition between each other in a bid to win lucrative foreign investment projects.
Less protectionism

Old forms of non-tariff protection such as import licensing and foreign exchange controls have gradually been
dismantled. Borders have opened and average import tariff levels have fallen.

That said, it is worth knowing that, in the last few years, there has been a rise in non-tariff barriers such as import
quotas as countries have struggled to achieve real economic growth and as a response to persistent trade and
current account deficits.

Growth Strategies of Transnational and Multinational Companies

In their pursuit of revenue and profit growth, increasingly global businesses and brands have invested significantly in
expanding internationally. This is particularly the case for businesses owning brands that have proved they have the
potential to be successful globally, particularly in faster-growing economies fueled by growing numbers of middle-
class consumers.

Answer this:

Three Ws (10 minutes engagement)

After reading, students are asked to either write or discuss the topic under study by responding to three questions
for their journal log/reflection as part of their e-portfolio.

• What did we learn today?

• So What? (What is its relevance, importance, or usefulness?)

• Now What? (How does this fit into what we are learning? Does it affect our thinking? Can we predict where
we are going?)

Formative Activity 1: LET US INVESTIGATE and RESPOND using TED talk presentation (30 minutes)

(Outcome 3 Create a TEDtalk presentation designed to describe the modern world system)

With the same grouping, kindly create/ innovate a TED talk presentation designed to describe the modern world
system and how it came about. The expected output by each group could be video lectures of your team talking
about the topic that could be presented in an online platform like Zoom, Google Meet, or Messenger. Or, it could be
PowerPoint slides or narrated PowerPoint slides with a voice-over by one of the members. It will be a 5-minute
presentation per team.

TED stands for Technology, Entertainment, Design. TED talks are 5-minute presentations based on the concept of
"ideas worth sharing." An innovative way to use this strategy in the classroom is to have students present TED talks
to their fellow students. The time for the talk may be limited (perhaps five minutes) during which students can
volunteer to share their thinking with their classmates. At the end of the presentation, make sure that all references
used by the team will be cited. (The 3rd member of the team will lead in the presentation of the output)

Work and brainstorm within the same group. Then after, present all your ideas in the class (let your 3rd member
explain the output this time)

Read the succeeding text for further understanding.

The Modern World-System

This history of colonialism inspired American sociologist Immanuel Wallerstein's model of what he called the
capitalist world economy. Wallerstein described high-income nations as the "core" of the world economy. This core
is the manufacturing base of the planet where resources funnel in to become the technology and wealth enjoyed the
Western world today. Low-income countries, meanwhile, are Wallerstein called the “periphery", whose natural
resources and labor support the wealthier countries, first as colonies and now by working for a multinational
corporation under neocolonialism. Middle-income countries, such as India or Brazil, are considered the semi-
periphery due to their closer ties to the global economic core.

In Wallerstein's model, the periphery remains economically dependent on the core in several ways, which tend to
reinforce each other. First, poor nations tend to have few resources to export to rich countries. However, the
corporation can buy these raw materials cheaply and then process and sell them in richer nations. As a result, profits
tend to bypass the poor countries. All of these unequal trade patterns lead to poor nations owing lots of money to
richer nations and creating debt. For example, the Philippines was recently approved of a $100 million loan from
World Bank for Covid-19 Emergency Response Project to help meet urgent healthcare needs in the wake of
pandemic and bolster the country’s public health preparedness.

For further information, you may visit this link:

https://www.youtube.com/watch?v=Y9zThcMJzQU

Criteria:

• 30 points max (per group) - factual, complete, accurate, concise, comprehensive, and efficient relay of ideas.

• 30 points max (each member) - the level of participation to the group discussion and knowledge
construction (to be identified by the group members themselves)

Activity Processing:

1. How did you find the activity? What or how did you feel upon contributing to the success of your group and upon
accomplishing the task?

Engaging Activity 3: Drop the Mic for Global Economic Integration (30 minutes)

(Outcome 4: Articulate a stance on global economic integration)

The title of this activity has become popularized in videos or on television when individuals complete a spectacular
performance or deliver a definitive or remarkable statement. In a classroom, students may be challenged by their
instructor/professor to capture the essence of an idea, put together a concise understanding of a subject, develop a
creative approach to capture an idea understudy or summarize a complicated subject. After students have had a
chance to devise their oral remarks, the teacher hands the student a microphone. Each participant makes a
presentation after which he or she "drops the mic."

Classmates are invited to show their approval through applause or cheers. Using still the group that has been
formed, give the 4th member of the team to deliver a definitive or remarkable statement based on online articles
and research on their stance on global economic integration. Have the 4th member cite the references they have
read and used after the performance.

Each team is given 3 to 5 minutes to present their claim.

• The world is getting richer because _____________________________________________

• The world is getting poorer because _______________________________________________

Visit the following links to prepare for this activity:

https://people.ucsc.edu/~rlipsch/migrated/Folder%20for%20Shawn/Lectures/Structure%20of%20the%20global
%20economy.pdf

https://www.youtube.com/watch?v=uBdKkeuDXNc

https://press-release/2020/04/23/Philippines-world-bank-approves-usd100m-to-support-covid-19-emergency-
response

Criteria:

• 30 points max (per group) - factual, complete, accurate, concise, comprehensive, and efficient relay of ideas.

Activity Processing:

1. How did you find the activity? What or how did you feel upon contributing to the success of your group and
upon accomplishing the task?

SYNTHESIS:

CLOSING GUIDE: (10 minutes)

(Free Form formative assessment)

1. What is Global Economy all about? Is it still relevant and can be related to everyone?

2. What are the factors that have contributed to the Global Economy?

3. Will a country grow if it will not depend on any other country for help?

4. Does the Global Economy exist in our locality/ community? Cite specific evidence to support your answer.

5. What is your overall thought on Global Economy?

Criteria:

•3 points max - factual, complete, accurate, concise, comprehensive, and efficient relay of ideas

•2 points max - effective manner or structure of explanation of knowledge or ideas (grammar and convincing or
persuasiveness factor)

REFLECTION STATEMENTS How do you think the Global Economy and communities adapt to the present life
under the ‘curse’ of the Pandemic?

ASSESSMENTS (I) All competencies/outcomes-based teaching-learning activities serve as the major assessments.

(II) Directions. Identify the following questions below:

_______1. It is the economy of all humans of the world, considered as the international exchange of goods and
services that is expressed in monetary units of account.

_______2. This is the cost of ocean shipping that has come down due to containerization which is a contributing
factor of globalization.

_______3. Who is an American sociologist who modeled what is called a capitalist world economy?

_______4. What are the names of the two “banks" created after WW2 to help countries in need?

_______5. How much was the recent loan of the Philippines from the World Bank for Covid-19 Emergency Response
Project

(III) Direction. Cite your opinion in 5-10 sentences if the Global economy has a negative and/ or positive impact on
our country regarding today's pandemic situation.

Rubric for Scoring ESSAY ITEMS:

CRITERIA POINTS

10 Answers use specific details from the lesson/s in a very clear, cohesive, and coherent way. No grammatical,

spelling, and punctuation errors.

8 Answers use specific details from the lesson/s in a clear, cohesive, and coherent way. Minimal grammatical,

spelling, and punctuation errors.

6 Answers each question with only 1 detail from the lesson, minimal grammatical, spelling, and punctuation

errors.

4 Answers the question using specific but unrelated details. Minimal grammatical, spelling, and punctuation

errors.

2 Answers the question without using any details from the lesson/s. Several grammatical, spelling, and

punctuation errors.

No answer 0

ASSIGNMENTS A. The students will answer the following:

1. What is the current state of the market in your barangay/ municipality/ city/ region? Explain each.

2. How can you assess our government here in the Philippines in handling the economy amidst the coronavirus
pandemic?

3. Do you think that the Global Market can recover?

B. Research on the Market Integration topics

1. Elements of Market Integration

2. 3 Types of Market Integration

3. Capital Market Integration in Asia

4. Market Shift amidst Pandemic

RESOURCES: Books

Aldama, P. (2018). The contemporary world. 856 Nicanor Reyes, Sr. Street Recto Avenue Manila Philippines: Rex
Bookstore.

Claudio, L. & Abinales P. (2018). The contemporary world 839 EDS South Triangle, Quezon City: C&E Publishing.

Globalization. (2019). In Wikipedia, the free encyclopedia.

Retrieved from https://en.wikipedia.org/wiki/Globalization

San Juan, D. (2018). Journeys through our contemporary world. 1253 G. Araneta Avenue cor. Ma. Clara Street,
Talayan, Quezon City: Vibal Group.

Online References

• https://www.cartoonistgroup.com/cartoon/Matt+Wuerker%27s+Editorial+Cartoons/2008-03-01/22116

• https://coreybradshaw.files.wordpress.com/2010/11/drowning-in-shit.jpg

• https://mizzouthinkglobal.files.wordpress.com/2015/02/povertyreductiontanzania-cartoon.jpg

• https://www.observerbd.com/details.php?id=177299

• https://www.cartoonistgroup.com/subject/The-Global+Economy-Comics-and-Cartoons.php

• https://www.cartoonistgroup.com/cartoon/Lisa+Benson%27s+Editorial+Cartoons/2020-04-30/182988

• https://www.youtube.com/watch?v=aemiFHJXrHI

• https://www.thoughtco.com/the-governments-role-in-the-economy-1147544

• https://people.ucsc.edu/~rlipsch/migrated/Folder%20for%20Shawn/Lectures/Structure%20of%20the
%20global%20economy.pdf

• https://www.youtube.com/watch?v=Y9zThcMJzQU

• https://people.ucsc.edu/~rlipsch/migrated/Folder%20for%20Shawn/Lectures/Structure%20of%20the
%20global%20economy.pdf

• https://www.youtube.com/watch?v=uBdKkeuDXNc

• https://press-release/2020/04/23/Philippines-world-bank-approves-usd100m-to-support-covid-19-
emergency-response