GLOBALIZATION OF ECONOMICS AND DEVELOPMENT

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GLOBALIZATION OF ECONOMICS AND DEVELOPMENT

• Prof. Anna Nedyalkova DSc
• Eleonora Tankova PhD

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Module 1

• From ECONOMICS to
• GLOBALIZATION OF ECONOMIS AND DEVELOPMENT
• WHY ?

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• Economics - The social science that deals with
  the production, distribution, and consumption of
  goods and services and with the theory and
  management of economies or economic systems.
• Macroeconomics - The study of the overall aspects
  and workings of a national economy, such as
  income, output, and the interrelationship among
  diverse economic sectors.
• Megaeconomics It studies the interaction of
  national economies through comparative analysis
  of the economic systems.
• International Economics - A branch of economics
  that studies economic interactions among
  different countries, including foreign trade
  (exports and imports), foreign exchange (trading
  currency), balance of payments, and balance of
  trade. The study of interational economics
  focusses on two related areas - international
  trade and international finance

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• Globalization Interdisciplinary subject which
  relates to all branches and fields of knowledge
• Main objectives of the study of Globalization of
  economics and developmentTHINK GLOBALLY AND ACT
  LOCALLY!
• So knowledge about globalization is important
  part of your academic knowledge !

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Changed economic activity of the society

• In our days no one sphere of life, including
  economic sphere can act independent and isolated.
  All processes and events should be examined and
  understood in the broad sense of economic,
  political, social, ecological and demographic
  context, taking into account their
  interdependence.
• The area of economic science is already too
  narrow to explain all the aspects of the complex
  and interdependence world.

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Actuality and Significance of the Subject
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Globalization of Economics and Development Two
Sites of One ProcessWHY?

• The main spheres of life are inseparable
• Economics is one of these spheres of life
• The technological development fosters the
  development of all other spheres
• Simultaneousness development of communication
  technologies, culture, education and etc.
• Trends for universality of development
• Economic activity of the society has changed
• The universal and national development are
  tightly bounded
• Our choice is to examine globalization of
  economics in the broad context of development !

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The Nature of Globalization

• Till 19th century global meant spherical
• At the end of 19th century global meant the
  whole world
• 20th century global meant definition of
  capacity and dissemination of events and
  processes

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Main key words

• About the process
• Universality
• Internationalization
• Integration
• Generality
• Worldwide

• About the main key players/agents
• Global companies
• International economic organizations
• Global markets
• The state
• Communication technologies

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Some special features of globalization in present
days

• Growing interdependence of all processes
• Establishing of a global financial-economic area
• Information technologies - WWW
• Change in the states functions vanishing of
  the national boarders
• Universality of the world dissemination of the
  democratic system and socio cultural values

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Some conclusions

• Global a new scientific category, which
  treats the processes and events on a global scale
• Globalization an approach which expands and
  deepens the economic theory as well as other
  scientific fields
• Subject of globalizations are
• - global companies
• - regional structures
• - the state
• - international economic organizations

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Evidences

• Civilizations they have originated
  independently from one another and have had
  common standards and rules of life
• Religions they have monotheistic character,
  universality of values and trends towards
  expansion of ideas
• Colonizational processes they have similarity
  of reasons, forms and consequences creation of
  one-sided economic relations
• From the great migration of peoples till now
  there is a tendency for decreasing the
  uncertainty

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Theoretical discussion about Globalization

• Second half of 20th century the global idea
  emerged in philosophy and political science. Then
  it was transferred to communications theory and
  finally conquered economic thinking
• The 90-ties active discussion on the nature and
  essence of globality and globalization as a new
  stage of economics and world development.
• The Roman Club the report Limits of growth
  provoked the first serious discussion about
  globalization and raised the necessity to
  coordinate activities of all countries.

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Influence of Globalization on different spheres
of life

• Economic the trade roads were built global
  companies started their functions global economy
  and finance system have been created.
• Political tribes transformed to peoples,
  nations and states formed, after that regional
  unions and finally international authorities of
  governance.
• Geographical the great migration of peoples
  started, new lands were founded, empires created.
• Ideological unified social ideas spread on huge
  territories
• Informational the speech and writing were
  created, after that literature, finally massmedia
  and Internet

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Common Characteristics of the Globalization
Process

• The dynamic development of the globalization
  process follows the development of the society.
• As a phenomenon it has two levels general
  civilization and formative ones
• Contradictory process which has its positive and
  negative sides
• It is pursued by anti-social phenomena

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Examples from reality

• Attendance of new country to NATO
• - it could be considered as a local event, but
  the reality is

Military production
Weapon trading
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Definitions of globalization

• Globalization is a very high level of development
  of the globality of economics and life in the
  conditions and content of life activity expanding
  with a tendency for planetarism.
• Globalization is a compression of time and space.

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Module 2The role of the state

• Different statements
• I. Against the State
• Some scholars predict the end of national state
  power.
• Some argue that the state may only adjust to
  globalization, without having an active role in
  it.
• Some believe that the state will disappear.
• Michael Sandel
• Charles Maynes
• Zygmunt Bauman

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The role of the state

• Which structures will replace the State?
• The answer of the scholars, who share these
  statements is
• The global companies or
• The International organizations, such as UN,
  which has instruments for realizing global
  governance.

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The role of the state

• II. In defense of the State
• The facts of practice show that the role of the
  state is increasing in all aspects of social
  life, including economics. Economic globalization
  does not remove the necessity for functioning of
  the state.

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The role of the state

• Some arguments in defense of the state
• The state has guaranteed internal and external
  security
• The state has underpinned the law
• The state has funded national welfare systems
• The state has provided the structures for popular
  representation
• The state has built the framework for economic
  and social activities.
• So the state plays fundamental role in creating
  of institutional forms and strategies of
  globalization processes and supporting the
  process of capital concentration.

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• Two realities co-exist
• The so called borderless virtual world where
  geography does not count, and communication and
  business transactions can occur in a matter of
  seconds.
• 2. The other world is that of the everyday life
  of people in which borders still count, local
  realities are still complex and very different
  among themselves, and most fundamentally where
  social and economic problems still need to be
  addressed.

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Why have not all countries benefited to the same
extent from globalization?

• Countries that do not have strong institutional
  framework, as well as solid social policies and
  networks to cope with negative externalities most
  suffer the negative effects of globalization.
• External factors, such as the global trading
  environment, are crucial in creating greater
  opportunities or in posing constraints on a
  countrys economic growth.

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Module 3REGIONALISM

• Regionalism originated along with globalization
  and approximately at the same time.
• Factors leading to the formation of regional
  structures during ages
• Political
• Geographical
• Religious
• Military and defense
• Economical.

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REGIONALISM

• 40-ties and 50-ties of XX century new wave of
  regional structures in Europe
• 1948 Organization for European economic
  Cooperation
• 1950 European Coal and steel Community
• 1957 European Economic Community
• 1959 European Free Trade Association
• 1949 1991 Council for Mutual Economic
  Assistance (socialist countries)
• New factor for regional integration appears
• according to the social system- the world was
  divided into two social systems.
• 40-ties and 50-ties - Economic stabilization was
  the leading idea

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REGIONALISM

• 80-ties economic regional structures with
  mutual political, social or military and
  strategic goals
• - EU
• - ASEAN
• - NAFTA
• 90-ties the regional structures became even
  more closed with very clear mutual economic,
  social, cultural, educational etc. relations.
• They form the new structure of the world

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REGIONALISM

• Economical aspects
• Similar economic development
• Common priorities
• Forming common economic model
• Regional competitiveness and comparative
  advantages in a global arena
• Common reaction to the risks of the environment
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  

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REGIONALISM

• Some conclusions
• Objective, real, social and historical
  movement in which economic reasons dominate. They
  reflect and influence on political, cultural and
  educational activities. New international
  relations appear. Regionalism does not question
  the state and its future role.

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REGIONALISM

• Some conclusions
• The new major integration processes of the epoch
  globalization and regionalism established
  themselves in the 90-ties.
• Regionalism is an instrument of the state for
  attaining the further goals of globalization.
• In present days globalization is realizing
  through regional structures.

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Module 4Civilization basis of Globalization

• The analysis of the globalization should be made
  at two levels
• General civilization level
• Formative level (social system)
• There is a clear dependence of globalization from
  the civilization model and from the dominated
  social system.

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Civilization

• Civilization is a complex society or culture
  group developed upon common or similar
  principles, with common or similar
  characteristics and marks.
• Civilization is a system of nations and states
  which have had their own specific historic
  destiny in a long period of time.
• Culture is a subsystem of civilization. In one
  civilization can develop and exist a lot of
  similar cultures with their national specifics.

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• The engines of the civilization progress are
• The permanent fight between man and nature for
  surviving and satisfying mans needs.
• Factors of progress science, technologies,
  labor etc.
• Factors of social conflicts properties,
  capitals, territories.

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Three mechanisms for societys integration
In each society the three mechanisms exist, but
one of them dominates!
Culture An integrated pattern of human
knowledge, belief and behavior that depends upon
the capacity for symbolic thought and social
learning
Religion System of values, practices and norms,
related to the idea of God. A composition of
attitudes between God and man.
Ideology System of ideas, which serve the
politics, recommend public and political
structure of the society and the type of
relations between mad and authorities
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• These three mechanisms have four main functions
  in different societies
• 1. Unite the individuals
• 2. Create social capital, which makes easier the
  achievement of common aims
• 3. Establish the authoritys functions and
  inequality
• 4. Create life aims and ambitions.

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• When some of the three mechanisms does not work
  effectively, the society is in a condition of
  DESINTEGRATION!
• Lack of trust
• Growing criminal activities
• A lot of anomalies
• The social processes are not managed
• The private interests dominate over the common
  values

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Formative basis of Globalization

• Main features of the capitalistic system
• Intensified and strong competition between
  corporations and leading countries
• Technological contest new form of competition
• The corporate secret and informational isolation
• The market economy and the state set different
  conditions for going off the globalization
  process
• Models of development for each country they
  determine the aim and the character of the
  economic growth

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Conclusions

• Globalization manifests in different way at
  civilization and formative level.
• At civilization level it should develop and
  enrich the humanity without breaking its
  diversity.
• According to the social system of the country,
  different social and economic consequences are
  shown.

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Module 5

• Globalization- contradictions, tendencies and
  prospects

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• Globalization is one of the forces of development
  putting the other factors of development and
  growth on a new basis and in new relations.
• Globalization effect the systematic result of
  the influence of the globalization on the other
  factors and forces of development

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• On the general historical level globalization is
  effected by several main factors
• - technical and technological progress
• - quality and content of interaction between man
  and nature
• - culture, media and communication
• - organization of public production.

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• Within the frames of the social system, in our
  case the capitalist system, globalization takes
  place under the influence of the following
  factors
• - market environment, market mechanisms
• - competition
• - state
• - international financial system
• - surrounding natural environment

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Economics
Globalization
Democracy and politics
Culture
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The role of technological factor

• Technologies are a product of science.
• Technologies are materialized reality of science.
• Technologies are socially neutral and all the
  conflicts that occur in society does not relate
  to technologies.
• The effect of and role of technologies in life
  depend on the way of application and the goals
  pursued.

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Technologies the main source for development

• 17th century scientific revolution scientific
  knowledge was applied and machines were invented.
• 18th century the beginning of the industrial
  revolution.
• 19th century - intensive application of science
  in the material production.
• 20th century inventing the computer and its
  using, replacing some functions of the machines

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Technologies the main source for development

• 21th century expansion and development of the
  functions of technology. Technology acquires also
  some social characteristics - new technologies
  can reproduce biological and mental functions.

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The effects of technologies are

• A possibility and necessity for public production
  to go out of the national-state frames
• A possibility and necessity for the management of
  the society to be performed by means of
  information technologies and communication
  networks
• Acceleration of the synthesis between the results
  of R/D and the transfer of technologies
• Formation of a new type of consumer demand which
  can not be shut off within the frames of national
  markets

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Industrial revolution created the global market
Technological revolution created the global
society and the global economy
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Negative tendencies

• Technological competition
• Technological dictate
• Technological determinism
• Technological imperialism
• There is no free movement of technology

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Global media and communication

• Modern communications and their basic form
  media are a product of the new technologies and
  major circumstances which have given rise to
  globalization.
• They ate total global structure with universal
  effects.
• They have organizational transformation on a
  company level
• At first a process of uniting in communication
  and media complexes began
• Then their merger into huge industrial and
  financial corporations.

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• The main economic force of media and
  communications is global capital, which through
  them turns into a universal force of society
• Media have become a sub-system of global
  corporations and a means of realizing their
  global strategies
• Media in itself have turned into a global and
  universal factor of development.

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Culture

• In the past years culture and economics were
  treated as separated and independent spheres.
• The importance of culture in the overall
  development of society is evidently increasing,
  showing itself in economics too.

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Economics - Culture

• The common feature between them is that both
  follow the overall development of the society
• The development of culture is not always
  following the development cycle of economics
• The cultural specifics of a nation, state or
  region is much more clear then their economic or
  political specifics
• Cultural processes are determined by the national
  and state differences.

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Culture - Globalization

• The cultural processes gain the importance of
  major conditions of life and effect each human
  activity
• Culture is turning into one of the basic factors
  of economic growth, while cultural product is
  among the new strategic resources of society
• Culture became a specific sphere of
  entrepreneurship
• Culture, education and science form new economy
  - knowledge economy

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Is their Global Culture?

• The early 70-ties the French Ministry of Culture
  introduced in the scientific space the concept
  cultural imperialism
• 80-ties and 90-ties the theses of war of
  cultures, conflict of civilizations were very
  popular
• Later appear the concept of Americanization of
  world culture

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Some conclusions

• The very globalization of economics, science and
  technologies requires a very high degree of
  development of cultures.
• The concept of glocalization, introduced in
  Japan in 1996 a combination of global and
  local, expressing the need for globalization to
  be carried out in compliance with the specifics
  of the individual countries.

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• The main contradictions of culture in the global
  world is between its economic form of realization
  and its esthetic and artistic nature.

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Democracy and politics

• Democracy means that peoples and their
  parliaments should be sovereign judges in their
  own countries. They should choose the national
  model of development and solve the main problems
  of organization and functioning of the national
  economics.
• In practice the decisions are taken at the head
  offices of the global corporations and are
  implemented in the individual countries. This is
  how the issues of the structure of production, of
  investment and technological policy, of strategic
  marketing are solved.

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• After 11th September 2001 the world is not the
  same
• Unstable political relations and political
  systems
• New paradoxes of democracy appear
• New wave of religion expansion
• Terrorism
• Using weapons to solve problems and conflicts
• Economics of war opposes the humanism and
  subordinates the world order to corporative
  interests.

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• Globalization comes in contradiction with human
  rights and with the very principle of
  individualism, which along with competition, is
  the fundament of capitalist system.

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Globalization in contemporary conditions is an
asymmetry

• Deepening gap between the economies of the
  developed and developing countries
• Intensified struggle for additional access to
  resources and markets
• Ecological asymmetry
• Poverty and polarization of men
• Uneven location of people
• Continuing international debt crisis

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• THANK YOU !!!