IC 114- Globalization and Public Administration

Lesson 1- Introduction to Globalization

Week # 2- 4: August 23- Sept. 2, 2021

Submit by September 2, 2021

Page 1 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
SANTO TOMAS COLLEGE OF AGRICULTURE, SCIENCES AND TECHNOLOGY
Fdr. Road 4, Tibal-og, Sto. Tomas, 8112
Davao del Norte, Philippines

LEARNING MODULE on IC 114- Globalization and Public Administration

I- Introduction to Globalization
a. Definition of Globalization
b. Historical Foundation of the term
“Globalization”.
c. Indicators of Globalization
d. Nature of Globalization
e. Dimensions of Globalization
f. Reasons of Globalization
g. Stages of Globalization
h. Merits of Globalization
i. Demerits of Globalization
j. Importance of Studying Globalization
k. The Importance of Globalization for Everyone
l. The Theory of Comparative Advantage
m. Philosophy Underlying Globalization
Students should be able to
differentiate the competing
conceptions of globalization;
understand the basic
concepts, definitions, and
underlying Philosophies of
Globalization. Explore the
negative and positive side of a
Globalized world.

DEFINITION OF GLOBALIZATION

There are many varying definitions of the term globalization. These are as
follows:

1. Globalization is the increasing interaction of people, states, or countries

through the growth of the international flow of money, ideas, and culture. Thus,
globalization is primarily focused on economic process of integration that has
social and cultural aspects.

2. It is the interconnectedness of people and business across the world that

eventually led to global, cultural, political, and economic integration.

3. It is the ability to move and communicate easily with others all over the world
to conduct business internationally.

4. It is the free movement of goods, services, and people across the world in a
seamless and integrated manner.

5. It is the liberalization of countries of their impact protocols and welcome reign

investment into sectors that are the mainstays of its economy.

Page 2 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
 6. It refers to countries acting like magnets attracting global capital by opening
their economies to multinational corporations.

GLOBALIZATION AS DEFINED BY OTHER AUTHORS

1. Martin Albrow and Elizabeth King defined globalization as those processes

by which the people of the world are incorporated into a single world society.

2. Anthony Giddens (The Consequence of Modernity) Defines globalization

as the intensification of worldwide social relations which link distant localities in
such a way that local happenings are shaped by events occurring many miles
away and vice versa.

3. Roland Robertson, Professor of Sociology at the University of Aberdeen

described globalization in 1992 as the compression of the world and the
intensification of the consciousness of the world as a whole.

HISTORICAL FOUNDATION OF THE TERM "GLOBALIZATION"

Though many scholars place the origins of globalization in modern times, others
trace its history long before the European Age of Discovery and voyages to the New
World, some even to the third millennium BC Large-scale globalization began in the
1820s. In the late 19th century and early 20th century, the connectivity of the world's
economies and cultures grew very quickly.

In 1897, Charles Taze Russell (of the Watch Tower Bible and Tract Society)
coined a related term, corporate giants. This term refers to the largely national trusts
and other large enterprises of the time.

In 1930, the word "globalize" as a noun appeared in a publication entitled

Towards New Education where it denoted a holistic view of human experience in
education.

In the late 1970's, the word "globalization" was coined. In 2013, this term was
used to mean "borderless society" referring to international migration.

In the early part of 1981, the term "globalization" had been used in its economic
sense. However, in the late half of the 1980's, Theodore Levitt popularized the term
"globalization" by bringing it into the mainstream business audience.

Lately in 2000, The International Monetary Fund (IMF) identified four (4) basic
aspects of globalization: (1) trade and transactions; (2) capital and investment
movements; (3) migration of knowledge (4) dissemination.

Page 3 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
 It is only in 2017 when the word "globalization" was openly used in teaching, in
discussion, in meetings and conferences, in lectures and so on. This time 2018, the
phenomenon of globalization is now on full swing in all academic disciplines.

INDICATORS OF GLOBALIZATION

The jet engine, the internet, e-banking, e-books, e-bike, the LRT, MRT and
other inventions of science and technology are attributable to the spread of
globalization. These are some of the modern offspring of development in our
infrastructure system. These improvements that people enjoy today in this
contemporary world have been major factors in globalization which have generated
further interdependence in economic and cultural activities among nations.

Likewise, environmental challenges such as global warming, cross boundary

water, air pollution, and over-fishing of the ocean are linked with globalization.
Globalizing processes affect and are affected by business and work organization,
economics, socio-cultural resources, and the natural environment. Academic literature
commonly subdivides globalization into three major areas: economic globalization,
cultural globalization, and political globalization.

NATURE OF GLOBALIZATION

Globalization is a conglomerate of various multiple units located in the different

parts of the globe which are linked by common ownership. The multiple limits draw on
parts of the globe, but all linked by common ownership. Multiple units draw on a
common pool of resources, such as money, credit, information, patents, trade names
and control systems. The units respond to some common strategy. Product presence
is in different markets of the world. Human resources are highly diverse. Transactions
involving intellectual properties such as copyrights, patents, trademarks, and process
technologies are across the globe.

DIMENSIONS OF GLOBALIZATION
The following are the dimensions of globalization

1. Planning to expand the business on a worldwide scope

2. Giving up the distinction between domestic and foreign market and instead
developing a global outlook of such business.

3. Locating the production and the physical facilities of the business by

considering global business dynamics irrespective of national consideration.
4. Creating product development and production planning on a global market
sphere.

Page 4 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
 5. Global sourcing of the factors of production such as raw materials
components, machinery, technology, finance, and others that are obtained from
the best source anywhere in the world.

6. Global orientation or organization structure and management culture.

REASONS FOR GLOBALIZATION

Why do we have to globalize especially at this contemporary world? Here are
the reasons:

1. Rapid shrinking of time and distance across the globe. One can easily cross
the bridge going to the other side of the marketplace due to advance tools of
technology than before.

2. Domestic markets are no longer rich because of many interlocking factors.

3. Companies and institutions go global to find political and economic stability

which is relatively good in other countries than the country of origin.

4. To get technological and managerial know-how of other countries due to their

advancement in science, technology, education, health, and other fields of
discipline.

5. To reduce high transportation costs if one goes globally using the advance
tools of communication and information.

6. To be close to raw materials and to markets for their finished products which
are not available in the country of origin. 7. The creation of the World Trade
Organization (WTO) had made it possible in stimulating increased cross border
trade. There are other world bodies like the UN and several arbitration bodies
where countries agree.

STAGES OF GLOBALIZATION
There are five (5) stages of globalization. These are:

Stage 1

The first stage is the arm's length service activity of an essentially domestic
company/institution which moves into new market overseas by linking up with local
dealers and distributors.

Page 5 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
 Stage 2

In this stage, the company/institution takes over these activities on its own

Stage 3

In this stage, the domestic-based company institution begins to carry out its own
manufacturing marketing and sales in key foreign markets.

Stage 4

In this stage, the company/institution moves to a full insider position in these markets
supported by a complete business system including Research and Development
(R&D) and engineering. However, the headquarters mentality continues to dominate.

Stage 5

In this stage, the company/institution moves towards a genuinely global mode of

operation. In this stage, global localization happens, that is, the company/institution
serves local customers in markets around the globe responding to their needs. This
requires an organizational transition i.e. the company must denationalize its operations
and create a system of values shared by global managers.

MERITS OF GLOBALIZATION
What can a company or an institution gets from globalization? There are eight
(8) merits or advantages.

1. Global competition and imports keep a lid on prices such that inflation. It is less
likely to derail economic growth.

2. An open economy spur fast innovation with fresh ideas from abroad.

3. Export jobs often pay more than other jobs

4. Unfettered capital flow keeps interest rates low.

5. Living standards go up faster.

6. Productivity grows more quickly when countries produce goods and services in
which they are of comparative advantage

7. Countries liberalize their visa rules and procedures to permit the full flow of people
from country to country.

8. It results in freeing up the unproductive sector to investment and the productive

sector to export related activities resulting in a win-win situation for the world economy.

Page 6 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
DEMERITS OF GLOBALIZATION

Globalization also has its disadvantages or demerits. Among these are:

1. Several people lose their jobs when companies import cheap labor or materials or
shift production abroad.

2. Workers face pay cut demands from employers who often threatens to export jobs.

3. Unregulated globalization can cause serious problems to poor and developing

countries in terms of labor force, wages, benefits, job termination, and others.

4. High foreign stake on industries where it is not necessarily needed could affect the
economic growth of domestic enterprise.

5. Sovereignty of a country and company/ institution may be at stake.

IMPORTANCE OF STUDYING GLOBALIZATION

In today's contemporary world, it is important for students to understand and
appreciate the study of globalization for the following reasons:

1. There is a greater demand in business and industry, health, engineering, and

technology to have people who can work with people of other nations and cultures.

2. There is a greater demand of promoting the local business and industry to other
countries and if need be, owners travel independently and internationally for a better
promotion.

3. The contemporary world face global challenges that will take interdisciplinary groups
to solve these challenges: These challenges are: how to provide access to clean
water, clean environment, clean renewable energy that is affordable to everyone and
how to deal with the unpredictable climate change just to name a few. These global
challenges need to be solved as soon as possible through the gathering and sharing
of information across disciplines, institutions, and other entities in a global scale.

4. Creating meaningful, harmonious, and workable relationship that link globally is an

important aspect of the merits of globalization, especially if one wish to be the
President of the future generation.

5. Knowledge of the merits, demerits and reasons for globalization will enable the
students to work as model of collaborative international team soon along the areas of
business, education, health science, arts, engineering, hotel industries, etc. and
discuss best products in these areas.

Page 7 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
THE IMPORTANCE OF GLOBALIZATION FOR EVERYONE
According to Neil Kokemuller, a writer, globalization is the expansion of local
economies and businesses into a broader international marketplace. Even small
businesses have gotten active in the global environment as the Internet and mobile
technology have enabled communication across continents and countries.
Globalization has become important for several reasons, including the overall need for
businesses to compete, according to Kokemuller.

The Internet revolutionized the business arena, because it created a whole new
virtual marketplace that expands beyond physical and geographical boundaries.
Companies in foreign countries can now compete for customers in the United States
by leveraging their own country's resources, lower costs of labor and affordable
distribution processes. In the same way, U.S. companies can appeal to customers in
the Philippines and other countries by promoting their goods and services.

The development of business, industry and income levels in several large

population centers has also contributed to the importance of globalization. China,
India, and Brazil are prominent examples of thriving economies as of 2013. Nearly two
billion people reside in these countries. As customers gain buying power, U.S.
companies race for the all-important capital that their revenue dollars can provide.
Partnership opportunities with businesses in these countries can aid growth.

Competition

Even if you want to avoid the globalization movement, you often have no choice
but to compete. The influx of foreign competitors in the U.S. limits the number of
companies in some industries that can succeed domestically. In the same way, if your
competitors expand globally, you must consider following suit. Any money other
companies make in foreign markets, they can bring back to the United States and
invest it in promoting their brands, products, and services domestically.

Diverse Population

Business trends often mirror broader societal trends. The United States, and
the world in general, has become very diverse. The United States is home to
immigrants from many countries around the world. As people move to different parts
of the world, they spread different ideas, perspective, and customs. Foreign-born
citizens who work for and buy from U.S. companies often want to see them get
involved in doing business in other parts of the world.

Page 8 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
THE THEORY OF COMPARATIVE ADVANTAGES
Globalization is grounded on the Theory of Comparative Advantage. This
theory states that countries that are good at producing good are better off exporting it
to countries that are less efficient at producing that good. Conversely, the latter country
can then export the goods that it produces in an efficient manner to the former country
which might be deficient in the same. The underlying assumption here is that not all
countries are good at producing all sorts of goods and hence they benefit by trading
with each other. Further, because of the wage differential and the way in which
different countries are endowed with different resources, countries stand to gain by
trading with each other.

PHILOSOPHY UNDERLYING GLOBALIZATION

Globalization is one of the most widely spread recent cultural, social, economic,
and political phenomenon which has strongly marked the discourse of the humanities
and social sciences. This new, not-yet constituted era poses multiple challenges in
which there is room for novel theoretical paradigm in this new emerging world.

1. The concept of globalization has only recently been widely accepted and adapted -
words like global, globality, globalization, globalism as well as the concepts of global
market, global ecology, global citizen, its more truly unknown up to the very end of the
20th century.

2. Discussion of world issues used the derivatives of "international" rather than "global"
relations because of the recent popularized new concept of "globalization" has
resulted in innumerable contradicting definitions of the same.

3. While, normatively speaking, some people associate globalization with progress,

prosperity, and peace, some others consider it to be retrogression, disaster and decay.

4. The common and indisputable characteristics of all its definitions is the view that
globalization is "a process of economic, social, culture, and political activity, which
transcends nation-state borders and that it pertains to the world as a whole." It is within
this context that the multi dimensionality of the globalization process comes to face.

5. Globalization is a complex and controversial process of the building of the world

due to the creation of global institutional structures and global cultural forms like a free
market (economic unification of the world with uniform patterns of production and
consumption; democratic integration of the world based on common interest of
humankind, such as equality, human rights protection, rule of law, peace and security,
and moral integration of the world based on humanistic values - instead of national
state particularism.

Page 9 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
6. Various ideological movements of resistance to globalization have been emerging
in response to globalization such as the violent and destructive mass demonstrations
staged in various countries are a manifestation of resistance.

Finally, based on the above philosophical dimensions underlying globalization

is the free movement of goods, services, and people across the world in a seamless
and integrated manner. Globalization can be thought of to be the result of the opening
of the global economy and the concomitant increase in trade between nations in this
contemporary world.

The point here is that globalization has had positive and negative effects and
therefore, a deep approach is needed when discussing the concept. What is
undeniable is that GLOBALIZATION is here to stay hence it is better for the countries
in the global economy to embrace the concept and live with it in this contemporary
world.

Page 10 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration
LESSON 1 ACTIVITIES:
I- Definition- Define the following terms based on the lesson discussed in this
learning module. (2 pts. Each)

1.) Globalization –

2.) Competition –

3.) Population-

4.) Theory of Comparative Advantage -

5.) Contemporary World –

II- Illustrate – Draw in the provided box your idea or visual representation of
the Contemporary World (20 pts)

III- Discussions: Answer and Expound the following questions.

1.) What do you think is the most positive impact of Globalization to you as a
student? (10 pts.)

2.) What do you think is the most negative impact of Globalization to you as a
student? (10 pts.)

Page 11 of 11
STCAST-BPA 4/GoiBuncal/AC2021-22 1st Sem/IC 114- Globalization and Public Administration