MIDTERM EXAMINATION

1. Give your own definition of globalization and explain your definition. Distinguish

interdependence, interconnectedness, and integration from one another. Why are experiences

of globalization uneven? Why is there a need to study globalization and the contemporary

world in general?

Answer:

The world has constantly grown through time. Because of building our relationships with

other people across different countries, we adopted the cultures and practices of other regions in

the globe. We come from different places but almost share kin experiences in life. The world today

achieved growth because of diversity among people and countries. It is what globalization means.

Each country in the world has needs. For instance, the Philippines has a lot of rice fields.

However, lands for agriculture gradually deplete because of industrialization. The construction of

buildings used for manufacturing and other industrial purposes is an exchange for our paddy fields.

Deprived of enriching our agricultural land, our farmers might find other jobs for their income.

Some of them go abroad. Some of them do not find a job to work. It is so sad to see our farmers

lose their livelihood for the benefit of other people. Not only farmers are affected. But also the

people who take advantage of their work. We have scarce resources for rice. Yet, some continue

to destroy our rice fields. When our country experiences a shortage of our essentials for living,

such as rice, we import them from other countries. We also export them when our country has too

many supplies of them.

Through imports and exports, we see interdependence because we rely on other countries

across the globe to fulfill our needs through their resources, services, information, and data. It also
portrays interconnectedness and integration through the way we seek help from distant countries.

Moreover, how different countries willingly help other countries to improve their living leads to a

harmonious global whole.

Globalization improves the economy of a country. However, some countries do not keep

up with the growth and development of other countries. Maybe, because of their people as well as

their government. People, particularly those who experience poverty, are left behind. Some do not

earn money to buy their needs because they don't have a job or any source of income. Therefore,

they only rely on the government. On the other hand, financially stable ones can adapt to changes

brought about by different circumstances in the world because they have money to provide for

their needs.

The economy's growth and development depend on its people. If they only rely upon the

government, the government itself must do something about their situation. Some can improve

their lives but are uncooperative and irresponsible with how the government act towards lifting

their lives. On the other hand, some are cooperative and responsible. However, the government

does not have any responses to their financial issues or any problems. With imbalances of actions

from the public and the government, globalization experiences become uneven. Thus, we should

study globalization and the contemporary world to remind us of our responsibilities to the economy

and to improve people's lives through the growth and development of the world. Additionally, we

should learn more about globalization and the contemporary world to assess the growing

relationships (interdependence, interconnectedness, and integration) of the globe's economies,

cultures, traditions, and populations brought by the trade of knowledge, goods, services,

technology, and capital flows across countries.

2. What are the significant institutions and their respective roles that facilitate trading? What is

protectionism and why are countries ultimately forced to adopt trade liberalization instead?

Why does liberal trade policy still fail to aid fairer trading to all countries? How has the role

of trading help shape the course of globalization?

Answer:

Some significant institutions that facilitate contemporary economic governance are the

International Monetary Fund (IMF), the World Bank (WB), and the World Trade Organization

(WTO). The International Monetary Fund (IMF) is an institution that consists of 189 countries. It

promotes international trade, secures financial stability, encourages high employment and

sustainable economic growth, and decreases poverty in the world. Another institution is the World

Bank which provides loans and grants to the government of underdeveloped countries. To help

build their economies, they offer low-interest loans, zero or low-interest credits, and government

grants. These are to fund a wide range of investments in initiatives related to the management of

the environment and natural resources, as well as investments in the public, private, and financial

sectors, as well as infrastructure, health, education, and public administration. The World Bank

has two goals. It includes ending extreme poverty and boosting shared prosperity. The third

significant institution that facilitates trading is the World Trade Organization (WTO). It focuses

on international trade regulations between countries. Its roles are to run a worldwide set of trade

regulations, serve as a venue for discussing possible trade deals, resolve trade disagreements

among its participants, and provide assistance to developing nations. The three mentioned

organizations above contribute a lot to the transfer of goods and services across different countries

around the globe.

 Produced goods from different countries have been a source of imports that continue to

enhance the trade industries of the world. Due to the growing exchange of goods and services

around the globe, the government implemented a policy that impedes international trade to support

domestic industries. This policy is called protectionism. It is a trading strategy to reduce or stop

competition from other nations by imposing tariffs and quotas on imported goods or restricting the

availability of foreign products and services in the market. It is also the opposite of trade

liberalization, which is a process of reducing or eliminating the trade barriers that prevent countries

from freely exchanging goods and services. Adopting trade liberalization instead of protectionism

was ultimately forced by different countries because nations can use their comparative advantages

and focus on producing the goods and services at their best. If protectionism continues, our

economy may experience unfavorable situations such as reduced commerce, inflation, and a sort

of subsidy for protected industries. In the short run, protectionism provides benefits to developing

countries. However, in the long run, trade liberalization will be more successful because it

increases and sustains economic growth and welfare on a global scale.

Increased competition is a result of liberal trade policy. Foreign countries produce quality

goods because they use standardized resources. On the other hand, domestic firms prefer to use

cheaper raw materials to generate more products, but not of good quality. Foreign products cost

high because of the quality of materials used in production, while domestic products are not costly

because of low-standard materials for production. Trades from different countries do not have

regulatory barriers. Therefore, the cost of goods is not too high. Imposing a tax on goods and

services is not allowed in a free trade environment. Foreign countries can still be competitive

despite the growing and developing countries. However, domestic firms cannot keep up with the

competitive advantage of foreign countries because some only intend to earn more money by
producing more using low-cost mediums or substances. For instance, people tend to buy what is

costly and in good condition than low-priced and inefficient. Production of AquaFlask or

HydroFlask tumblers and other locally-made tumblers is an up-to-date example. Most people

prefer to buy the AquaFlask tumblers and HydroFlask tumblers because it is on trend. Though it

costs high, people buy these tumblers more than non-brand tumblers. Foreign countries earn more

than domestic ones because they produce high-standard products. That is why liberal trade policy

fails to aid fairer trading for all countries.

Trading has contributed to the complexity of businesses around the world. It helped people

to produce goods and services that may satisfy the needs of every consumer. Thus, one earns

money and makes a profit from it. Without the market as well as the consumers, trading will not

exist. But through the market with the consumers, the world built a relationship between the two

intermediaries. The exchange of goods and services becomes possible because people, as

consumers and as markets, are interrelated. Consumers will not satisfy their needs if there are no

markets that will produce goods and services for them. On the other side, marketplaces will not

grow and develop as it is today if there are no consumers. We are globalized today through the

influences of countries from different areas in distinctive aspects. Growth and development

achieved through interdependence, interconnectedness, and integration (Trading) are portrayals of

globalization. Therefore, trading helps shape globalization.