GE 3: Midterm Handout
Peripheral Process – scattered in a large
Globalization
According to Dicken (1998) “We now live in the
borderless world, in which the national
boundaries is no longer relevant.”
It is a process of interaction and integration
among people, companies and governments of
different nations.
The Global Economy:
The global economy can be traced by to the
expansion of long-distance trade during the
period of 1450- 1640.
Wallerstein labeled, “long sixteenth century”
trading companies emerged in Europe, such us
East India Company and Hudson Bay Company
which created international trade empire.
According to Dicken, the development of the
world trading system over a period of several
centuries helped to create tripartite, Core, Semi
peripheral, and Peripheral economic areas.
Bretton woods agreement, New Hamshire, in
1944
Establishment of:
International Monetary Fund (IMF)
International bank for reconstruction and
development (Present day, World Bank)
General Agreement on Tariffs and Trade (GATT) -
Elimination of protectionism
WTO – 199 superseded GATT, to reduce or
eliminate non-tariff barriers and uneven trading
conditions between countries.
COMPARATIVE ADVANTAGE (David Ricardo)
MODERNIZATION THEORY
According to the theory, Western European
nations began to emerge several centuries ago as
economic powers because their populations
adopted the kinds of values and practices just
listed.
DEPENDENCY THEORY
The poor nations never got the chance to pursue
economic growth because early on they were
conquered and colonized by European ones.
THE MODERN WORLD SYSTEM
Five institutions in the modern world system
(wallerstein, 2006)
1.Market – where individuals and firms can sell
products and buy goods.
2. Firms – who produces goods and provide
services in the market.
a. Core-like Process – group themselves in a
few states and constitute the bulk of the
production activity in this state.
b.
number of states and constitute the bulk of the
production activity in these states.
c. Semi-periphery – mix or core-like and
peripheral.
3. States - are related to the geographical
division of labor. The geographical division of
labor was discussed in the World System Theory
of Wallerstein.
4. Household - According to Wallersteins (2006)
households consist of three to 10 persons who,
over a long period of time, pool multiple source
of income in order to survive collectively.
5. Classes - classes have something to do with
the placement of the household or individual in
the capitalist economic system.
UNIVERSALISM:
Universalism is a theme prominently associated
with the modern system. It means the priority to
general rules applying equally to all persons and
rejection of particularistic preferences in the most
sphere.
ANTI -UNIVERSALISM:
It is linked with racism and sexism. are norms,
but they are negative norms, in that most people
deny their belief in them.
MARKET INTEGRATION
As defined by Koester (2000), is a state of affairs
or a process involving attempts to combine
separate national economies into larger economic
regions.
Two types of integration:
Negative Integration reduces non-tariff and tariff
barriers to trade as a main tool for integrating
markets.
Positive Integration adjusts domestic policies and
institutions through the creation of supranational
arrangements.
The integration come in five forms:
1. Preferential agreement involves lower trade
barriers between those countries, which have
signed the agreement
2. The free trade area (FTA) reduces barriers to
trade among member countries to zero, but each
member country still has autonomy in deciding
on the external rate of tariff for its trade with
non-member countries. European Free Trade
Area.
3. Customs union represents a higher stage of
economic integration. In this form, countries
agree to abolish tariff and non-tariff barriers to
trade in goods flowing between them.
4.The common market allows for free movement
of labor and capital within the member-countries.
5. The Economic Union is the highest form of
economic integration. in addition to the
conditions of a common market, member
countries also agree to integrate monetary, fiscal,
and other policies.
INTERNATIONAL FINANCIAL
INSTITUTIONS:
World Trade Organization- Formerly known as
General Agreement on Tariffs and Trade (GATT)
Only global international organization dealing
with the rules of trade between nations.
INTERNATIONAL MONETARY FUND- Provide such
an institution as would exert control on
international exchange rates as well as act as
reserve base bailing out BOP deficit countries.
WORLD BANK- International Bank for
reconstruction and development.
Types of Global Corporation:
International Companies
Multinational Companies
Transnational Companies
ROLE OF MULTINATIONAL COMPANIES:
1. MNC’s act as modernizer of the world’s
economy
2. Promote efficiency and growth of the world
economy
3. Promote regional agreements and alliances
4. Increase of money circulation in the economy
THE ELECTRONIC HERD AND THE GOLDEN
STRAITJACKET
The Electronic Herd
Friedman (2000) referred to it as the electronic
herd. He defined the electronic herd as a group
made up of all the faceless stock, bond, and
currency traders sitting behind a computer
screens all over the globe, moving their money
around from mutual funds to pension funds to
emerging market funds, or trading on the
Internet from their basements.
REGIONAL AND ECONOMIC
PARTNERSHIPS/INSTITUTIONS:
ASSOCIATION OF SOUTHEAST ASIAN NATIONS
(ASEAN) The Association of Southeast Asian
Nation, or ASEAN was established on 8 August
1967 in Bangkok, Thailand, with the signing of
the ASEAN Declaration (Bangkok Declaration) by
the Founding Fathers of ASEAN, namely
Indonesia, Malaysia, Philippines, Singapore, and
Thailand. Brunei Darussalam (1984), Vietnam
(1995) Lao PDR and Myanmar on (1997), and
Cambodia (1999) makes up what is today the 10
member-states of ASEAN (asean.org).
EUROPEAN UNION
The EU was not always as big as it is today. When
European countries started to cooperate
economically in 1951, only Belgium, Germany,
France, Italy, Luxembourg and the Netherlands
participated. Over time, more and more countries
decided to join. The Union reached its current
size of 28 EU countries. The goals of the
European Union are:
1.Promote peace, its values and the Well-being of
its citizens;
2.Offer freedom, security and justice Without
internal borders;
3.Sustainable development based on Balanced
economic growth and price Stability;
4. Highly competitive market economy With full
employment and social Progress;
5. environmental protection;
6. combat social exclusion and Discrimination;
7. promote scientific and technological Progress;
8. enhance economic, social And Territorial
cohesion and solidarity Among EU countries;
9. respect its rich cultural and linguistic Diversity;
and
10. establish an economic and monetary Union
whose currency is the euro.
NORTH AMERICAN FREE TRADE
In 1994) the North American Free Trade
Agreement (NAFTA) came into effect, Creating
one of the world’s largest free trade zones and
laying the foundations for strong economic
growth and rising prosperity for Canada, the
United States, and Mexico.
ORGANIZATION OF THE PETROLEUM EXPORTING
COUNTRIES OPEC
is a permanent intergovernmental Organization of
15 oil-exporting developing Nations that
coordinates and unifies the Petroleum policies of
its Member Countries. It is created at the
Baghdad Conference on September 10-14, 1960,
by Iran, Iraq, Kuwait, Saudi Arabia, and
Venezuela.
TRANSNATIONAL ACTIVISM
Transnational activism gained momen- tum on
the the latter part of the 90's. Awareness,
responsibility, participation and cultural empathy
are usually the driving force of transnational
activists.
Caoutte (2006) defined transnational activism as
social movements and other civil society
organizations and individuals_operating across
borders. Transnational collective action on the
other hand is the coordinated international
campaigns on the part of networks of activists
against international actors, other states, or
international institutions. Included in the
transnational activists are nonstate actors who
may not have political influence but can gain
moral support from the public through persuasion
and information dissemination.
is a non-governmental organization that aims

determinan
towards having a greener, healthier environment.
It protects the forests and the seas. If for
example, the Philippines lack programs and
policies for environmental protection, the
Greenpeace as a transnational advocacy network

t and
may pressure the state to come up with rules and
regulations that will protect the environment.

GLOBAL GOVERNANCE

Global predomina
governanc nt role.
e can play Global
a governanc
facilitative e can play
and a
constrainin facilitative
g role, but and
it scarcely constrainin
plays a g role, but
it scarcely constrainin
plays a g role, but
determinan it scarcely
t and plays a
predomina determinan
nt role. t and
Global predomina
governanc nt role.
Global governance can play a facilitative and

e can play
constraining role, but it scarcely plays a
determinant and predominant role.

THE UNITED NATIONS

an international organization founded in 1945

a
made up of 193 Member States. The mission and
work of UN is guided by the purposes and
principles contained in its founding charter.

facilitative  he main
organs of
and
the UN Trusteeshi
are: the p Council,
General the
Assembly, Internation
the al Court of
Security Justice,
Council, and the
the UN
Economic Secretaria
and t.
Social  he main
Council, organs of
the the UN
are: the p Council,
General the
Assembly, Internation
the al Court of
Security Justice,
Council, and the
the UN
Economic Secretaria
and t.
Social  The main
Council, organs of
the the UN
Trusteeshi are: the
General the
Assembly, Internation
the al Court of
Security Justice,
Council, and the
the UN
Economic Secretaria
and t.
Social  The main
Council, organs of
the the UN
Trusteeshi are: the
p Council, General
Assembly, Internation
the al Court of
Security Justice,
Council, and the
the UN
Economic Secretaria
and t.
The main organs of the UN are: the General

Social
Assembly, the Security Council, the Economic and
Social Council, the Trusteeship Council, the
International Court of Justice, and the UN
Secretariat.

Council,
THE ROLE OF THE UNITED NATIONS:

1. Maintain International Peace and Order

The UN Security Council
The General Assembly

the
The Secretary-General

2. Protect Human Rights

Human Rights
Universal Declaration of Human Rights

Trusteeshi 3. Deliver Humanitarian Aid

Coordinate humanitarian relief operations.

4. Promote Sustainable Development

p Council,
Sustainable Development

5. Uphold International Law

UN Charter – an international treaty.

the