THE STRUCTURES OF GLOBALIZATION

Race to the bottom – refers to countries’ lowering their labor standard, including the protection of worke
rs’ interests to lure in foreign investors seeking high profit margins at the lowest cost possible.

Transnational corporation – concerned more with profits than with assisting the social programs of gov
ernments assisting them.

Market Integration – process of economic transformation within a region, bloc, or group of countries, ai
med at pegging one price for the same product, thereby directly or indirectly merging previously separate
markets or economic communities into one single market or economic community.

Global corporation – a company that operates in number of countries, in contrast with companies that op
erate only in one or few countries.

Oil embargo - is a political and economic strategy employed by one or more countries to restrict or comp
letely halt the export of oil to another country or group of countries.

For example: Organization of Arab Petroleum Exporting Countries

The goal of an oil embargo is usually to compel the targeted country to change its policies, behavior, o
r political stance by creating economic hardships and energy shortages.

SILK ROAD – The oldest known international trade route.

GALLEON TRADE – it was part of the age of mercantilism.

GLOBAL ECONOMY – provides linkages between the regions and nations of the world in a system of
economic relationships.

TWO TYPES OF ECONOMY

- Protectionism
- Trade Liberalization

GLOBAL CORPORATIONS – ensure a leading role in making the cogs of capitalist globalization oper
ate as smoothly, efficiently and profitably as possible.

MARKET INTEGRATION – is shaped and influenced by governments, global or multinational corpora

tions. This occurs when prices among different locations or related goods follow similar patterns over a lo
ng period of time.

TWO TYPES OF MARKET INTEGRATION

NEGATIVE INTEGRATION (Liberalization)
– reduces non-tariffs and tariffs barriers to trade as a main tool for integrating markets.

POSITIVE INTEGRATION (Deregulation)

– the government of governments adjusts domestic policies and institutions through the creation of supran
ational arrangement.
INTERNATIONAL TRADING SYSTEM - All important populated continents began to exchange prod
ucts continuously both with each other directly and indirectly via other continents. International trade flou
rished with most of the benefits going to Western powers.

INTERNATIONAL MONETARY SYSTEM

– To some extent silver, gold, and other precious materials were already used as de facto currency in man
y parts of the world even before the modern times.
– De facto currency

TWO TYPES OF CURRENCIES

REFUGE CURRENCIES – currencies that tend to strengthen during the periods of uncertainty and fear
in the market.

COMMODITY CURRENCIES – are the currencies of economies with the large share of production an
d export of natural resources.

BRETTON WOOD SYSTEM

Was inaugurated in 1944 during the United Nations Monetary and Financial Conference. Was largely infl
uenced by the ideas of British economist John Maynard Keynes.

1. Keynesianism
Created an international basis for exchanging one currency for another. Led to the creation of Internationa
l Bank for Reconstruction and Development or now known as World Bank (WB) and International Mon
etary Fund (IMF).

GENERAL AGREEMENTS ON TARIFF AND TRADE (GATT)

– established by a multilateral agreement regulated international trade in 1947.
– aims to strengthen international trade
– covers only trade in goods
– has appellate body to review findings and settle disputes

WORLD TRADE ORGANIZATION

– replaced GATT in 1995
– aims to govern international trade
– covers trade in goods and services
– disputes are fixed by using multilateral systems

WORLD TRADE ORGANIZATION

Richard Peet claims that WTO is opposed by small farmers, labor unions, and environmentalist.

Believe to be capable of doing ten things:

1. Cut living cost and raise living standards;
2. Settle disputes and reduce trade tensions
3. Stimulate economic growth and employment
4. Cut the cost of doing business internationally;
5. Encourage good governance;
6. Help countries to develop;
7. Give the weak a stronger voice
8. . Support the environment and health;
9. Contribute to peace and stability;
10. Be effective without hitting the headlines
GLOBAL INTERSTATE SYSTEM AND GLOBAL GOVERNANCE

Global Interstate System/Modern World System

It is the whole system of human interactions. The modern world system is structured politically as intersta
te system, a system of competing and allying states. Political scientist commonly call this the international
system, and this is the focal point of the field of international relations.World systems are defined by the e
xistence of division of labor.

The Modern World System

– Developed by Immanuel Wallerstein
– In his book, Wallerstein explains that the “world economy is a large geographic zone within which ther
e is a division of labor and hence significant internal exchange of basic or essential good as well as flow o
f capital and labor.
– Some countries benefit while others are exploited
– consist of Core Countries and Peripheral countries

INTERNATIONAL ORGANIZATION
It is commonly used to refer to international intergovernmental organizations or groups that are primarily
made up of member-states. One major fallacy about international organizations is that they are merely am
algamations of various state interests.

CONTEMPORARY GLOBAL GOVERNANCE

UNITED NATIONS – as the primary international organization.

SIX PRINCIPAL ORGANS:

1.United Nations The General Assembly (UNGA)
Main deliberative policymaking and representative organ. Tasked to do the decision-making on important
questions such as those on peace and security, admission of new members and budgetary matters.

2. United Nations Security Council (UNSC)

Takes the lead in determining the existence of a threat to the peace or an act of regression. To settle a disp
ute by peaceful means and recommends methods of adjustment or terms of settlement. It can resort to imp
osing sanctions or authorizing the use of force to maintain or restore international peace and security.

3. Economic and Social Council (ECOSOC)

The principal body for coordination policy review, policy dialogue, and recommendations on social and e
nvironmental issues. Their central platform for discussions on sustainable development.

4. International Court of Justice

The International Court of Justice, also known as the World Court, is the principal judicial organ of the U
N. It settles legal disputes between states and provides advisory opinions on legal questions referred to it
by the General Assembly, the Security Council, or other UN organs and specialized agencies. The ICJ's d
ecisions are binding on the parties involved.

5. Trusteeship Council
Its main responsibility was to oversee and administer trust territories—territories that were not fully self-g
overning and were placed under the administration of one or more member states until they could achieve
self-determination or independence.

6. UN Secretariat
It is responsible for implementing the decisions and policies of the UN's other organs.