Understanding Globalization: Perspectives and Historical Context

1. Chapter 2What is New About Globalization?

2. Current Definitions Defining globalization -A contestable topic - Each discipline views globalization from its perspective • International: Relating to two or more nations • Global: Relating to the whole world

3. Our Definition We need a definition that is: - Neutral - Treats it as a process than an end in itself - Can accommodate multiple perspectives Our definition of globalization: Globalization represents the continuing effort by the peoples of the world to interact and share transnationally in the pursuit of their objectives

4. Globalization for a Business Person • Business requires an integration of the social, economic, political, and scientific milieus: • Marketing and human resources are affected by cultures • Manufacturing and operations are affected by technological developments • Firms’ founding and future are influenced by the interaction between the political and economic environments

5. Globalization’s effects are felt at different levels: • Individual • Group: organizations or communities • Nation • Need to understand globalization from a multidisciplinary perspective

6. Forces Integrating Societies in History • Merchants • The Silk Road • Religion • Missionaries and conversion • Explorers • Wealth • Politics • Territory

7. The Silk Route (Source: Wikipedia)

9. Colonization Colony: Territory that is under the political control of another geographically distant entity – the “colonial power” Empire: Group of states or countries under one supreme authority Different models of colonization • Spanish colonies: Settled, created mixed societies • British / French colonies: Recreated their origins • Portuguese / Dutch colonies: Commercial empires that became political

10. Technological advantages such as: • Ability to build ships • Availability of navigational tools • Development of sophisticated armaments …allowed Europeans to venture out of sight of land • Political motives for more power replaced initial motivations for colonization

11. Mercantilism • Dominant during the 16th to the 18th centuries • A nation’s prosperity depended on the amount of capital it accumulated (eg. gold, the currency of the day) • Encouraged positive balance of trade (exports > imports) with other nations leading to inflow of gold. • The theory prescribed policies that: • Created trade monopolies • Discouraged imports through tariffs • Justified acquisition of colonies

12. Colony’s economy could be managed to support the needs of the colonial power and thus be complementary. • Colonization also exemplified the link between economics and politics. • While mercantilism led to colonization in the 17th and 18th centuries, the dominant logic in the 19th and 20th centuries shifted to imperialism. • Imperialism: Need to dominate and control power and prestige

13. The Colonial Experience • British Experience: • Began as the East India Company and ended as the British Empire • EIC accounted for 50% of world trade and 25% of world population • By 1914, European Powers controlled 84% of land’s surface • India (under Britain) and Indonesia (under Netherlands) saw shrinking economic growth

14. Colonization Positive • Physical assets: railways and dams • Institutions: legal systems, courts, administrative mechanism • Knowledge sharing: in art, literature, and lifestyles Negative • Traumatic changes that colonies underwent to adjust to the colonial power’s needs • Economic sphere: deindustrialization, pay tribute • Social sphere: Altering Education systems, loss of self-esteem, sense of identity • Political: Undermining local institutions

15. Evaluating Colonization • Would the country/society have been better off without a colonial intervention? * Economic and moral impacts • Lingering effects of colonization * Governance, leader behaviors * Economic and cultural links

16. Historical Isolation • Japan * Isolation begins in 1641 * 1854, Commodore Perry opens trade * 1867, Meiji Restoration • China * Foreigners welcomed under Tang dynasty * Quing dynasty, restrictions on foreigners * Opium war and Treaty of Nanjing, 1842

17. Driving Forces of Globalization • Coming together of different worlds • First, second, and third world • Enhanced regional cooperation • EU and other regional groups • The digital revolution • Shrunk the world • Seeking global solutions • Global issues requiring global cooperation