WHAT IS GLOBALIZATION?WHY IS IT HAPPENING?
HOW DOES IT IMPACT US AND THE WORLD?
GLOBALIZATION
• DEFINED: an ongoing process by which regional economies, societies, and cultures have become integrated through a globe-spanning network of exchange and trade
• Occurs thanks to the interconnectedness of the modern global economy
• Globalization forces our culture to interact and deal with others
SUPPLY CHAINS• DEFINED: the connections that link all
parties involved in the production and sale of a product
• Supply chains begin and end with the consumer (you)!
• First a consumer DEMANDS, or wants a product
• Then a long “chain” of people work to SUPPLY create it
• It ends with the consumer ends by purchasing it at a certain PRICE
• Example?
Why is globalization happening so quickly now?
• ECONOMIC REASONS: – New forms of technology allow gigantic flows
of capital and other technologies
• Transnational corporations (TNCs)
• International economic institutions
Bretton Woods Conference 1944
• 44 Nations agreed to revise trade practices
• 3 new int’l economic organizations– IMF: International Monetary Fund– World Bank– GATT: General Agreement on Tariffs and
Trade later to be the World Trade organization (WTO)
• Bretton Woods lasted for over 30 years– “the golden age of controlled capitalism– Ended by conservative politics embrace of
“neo-liberalism”• Market is self-regulating• Survival of the fittest (Herbert Spencer)• Rejected Keynesian models of state intervention• Validated by the fall of communism
Transnational Corporations (TNCs)
• GM, Walmart, Exxon, Mitsubishi, Siemens, etc
• 42 of the world’s top economies are corporations
• powerful players the influence the economic, political and social welfare of many nations
• International Economic Institutions– IMF, World Bank, WTO– Began as means of loans to developing
nations– Now more interested in integrating and
deregulating markets around the world
Problems with Globalization
• Lowering of labor standards
• Ecological degradation
• Growing indebtedness of the Global South to the North– Loans tied to laws– Interest payments now exceed aid received
($355 Billion interest v. $80 Billion in aid)
