THE STRUCTURES OF

GLOBALIZATION
LEARNING OUTCOMES

Identify the actors that facilitate economic globalization

Define the modern world system
Articulate a stance on global economic integration
Identify the attributes of global corporations
Explain the effects of globalization on governments
Identify UN roles and functions
WORDS TO GO BY

 Market Integration – process of economic transformation within a

region, bloc, or group of countries, aimed 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 operate only in one or few
countries.
WORDS TO GO BY

Race to the bottom – refers to countries’ lowering their labor

standard, including the protection of workers’ 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 governments assisting
them.
WORDS TO GO BY

Oil embargo - is a political and economic strategy employed by

one or more countries to restrict or completely 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, or political stance by creating
economic hardships and energy shortages
LOOKING BACK AT THE PAST…

o SILK ROAD
The oldest known international trade route.
o GALLEON TRADE
It was part of the age of mercantilism.
GLOBAL ECONOMY
o Provides linkages between the regions and nations of the world
in a system of economic relationships.
o TWO TYPES OF ECONOMY
-Protectionism
-Trade Liberalization
XX12 Q`QQQ222

GLOBAL CORPORATIONS
o Ensure a leading role in making the cogs of capitalist globalization
operate as smoothly, efficiently and profitably as possible.
MARKET INTEGRATION
o Is shaped and influenced by governments, global or multinational
corporations. This occurs when prices among different locations or
related goods follow similar patterns over a long period of time.
 TWO TYPES OF MARKET INTEGRATION

o NEGATIVE INTEGRATION (Liberalization)

-reduces non-tariffs and tariffs barriers to trade as a main
tool for integrating markets.
o POSITIVE INTEGRATION (Deregulation)
-the government of governments adjusts domestic policies
and institutions through the creation of supranational
arrangement.
 INTERNATIONAL TRADING SYSTEM

All important populated continents began to

exchange products continuously both with each
other directly and indirectly via other continents.
International trade flourished 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
many 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 and export of natural resources
 BRETTON WOOD SYSTEM

Was inaugurated in 1944 during the United Nations

Monetary and Financial Conference.
Was largely influenced by the ideas of British economist
John Maynard Keynes
1. Keynesianism
 BRETTON WOOD SYSTEM

Created an international basis for exchanging one

currency for another.
Led to the creation of International Bank for
Reconstruction and Development or now known as
World Bank (WB) and International Monetary 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.
 WORLD TRADE ORGANIZATION
 Believe to be capable of doing ten things:

1. Cut living cost and raise living standards; 8. Support the environment and health;
2. Settle disputes and reduce trade tensions 9. Contribute to peace and stability; and
3. Stimulate economic growth and 10. Be effective without hitting the headlines.
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
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 interstate 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 existence of division of labor.
 THE MODERN WORLD SYSTEM THEORY

• Developed by Immanuel Wallerstein

• In his book, Wallerstein explains that the “world economy is a
large geographic zone within which there is a division of labor
and hence significant internal exchange of basic or essential good
as well as flow of capital and labor.
• Some countries benefit while others are exploited
• consist of Core Countries and Peripheral countries
 WHAT IS 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 amalgamations 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.
CONTEMPORARY GLOBAL GOVERNANCE

UNITED NATIONS as the primary international organization.

SIX PRINCIPAL ORGANS
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 dispute by peaceful means and recommends methods of adjustment
or terms of settlement.
 It can resort to imposing sanctions or authorizing the use of force to maintain or
restore international peace and security.
CONTEMPORARY GLOBAL GOVERNANCE

UNITED NATIONS as the primary international organization.

SIX PRINCIPAL ORGANS
3. Economic and Social Council (ECOSOC)
The principal body for coordination policy review, policy dialogue, and
recommendations on social and environmental issues. Their central
platform for discussions on sustainable development.
CONTEMPORARY GLOBAL GOVERNANCE

UNITED NATIONS as the primary international organization.

SIX PRINCIPAL ORGANS
4. International Court of Justice
The International Court of Justice, also known as the World Court, is the
principal judicial organ of the UN. 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 decisions are binding on the parties
involved.
CONTEMPORARY GLOBAL GOVERNANCE

UNITED NATIONS as the primary international organization.

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

UNITED NATIONS as the primary international organization.

SIX PRINCIPAL ORGANS
6. UN Secretariat
It is responsible for implementing the decisions and policies of the UN's
other organs.
CHALLENGES OF THE UNITED NATIONS

Chief among these are the limits of placed upon

its various organs and programs by the need to
respect state sovereignty. The UN is not a world
government and its function primarily
because of voluntary cooperation from state.