Globalization Group Project GhadaKarimMohamedWalid

8/4/2019 Globalization Group Project GhadaKarimMohamedWalid

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Globalization-Successes, Failures and Lessons

Learned

AU-GSU International Residency Project Phase III

Submitted to: Dr. Sevgin Eroglu

An analytical paper on globalization and international residency

observations

BY: Ghada Saafan, Karim Mamdouh, Mohamed Hamdy, &

Walid Reda

5/1/2011


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TABLE OF CONTENTS:

Table of Contents: ......................................................................................................................................................... 2

Part 1: Factors of the Globalization Debate: ................................................................................................................. 3

Culture: ...................................................................................................................................................................... 3

Environment: ............................................................................................................................................................. 5

Information Technology: ........................................................................................................................................... 8

Generally, to Be a flat world company , we should : ............................................................................................... 9

Part II: Successes and failures of globalization: ........................................................................................................... 10

Literature Review ........................................................................................................................................................ 12

Additional references: ............................................................................................................................................. 25


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PART 1: FACTORS OF THE GLOBALIZATION DEBATE:

Several economic and business factors have been raised in the globalization debate by the

several thinkers, economists and psychologists that engaged in this debate.

These included: the evolution of technology that helped accelerate integration of cultures and

economies; labor equity and cultures, resources and environmental concerns, and national

regulations and corporate governance. Of these factors, environment, culture and information

technology were selected by the team as most influential.

CULTURE:

Boyd and Cohen argued that structural interdependencies resulted from transactional activities

among firms in diverse nations like US, Japan, and Europe. This diversity includes distinctive

cultures, structures, laws and financial systems. Bhagwati cites Yet another source of anti-

globalization sentiments is the resentment that comes from the rise of the United States to a

military and economic hegemony so unprecedented that the French call America, with which

they have a notorious lovehate relationship, a hyperpower, as if being called a superpower is

no longer the highest accolade. In his article Fear of Globalization: the Human Nexus, Cohen

found that social returns to education have been higher in poor countries. This contradicts what

he believes a conventional wisdom that poor countries should experience a decline in their

returns to education as globalization raises the demand for low skilled workers in the South.

Culture is the first question a company asks when it plans to go global. Which country would

accept our products? Would our products fit the culture in this new market, or will we need to

adapt/customize our products to fit the taste of people in this country? Culture is also a main

component of pre-entry market researches, and a main factor when any adaptation is made to

a product.

One triumphant player of the cultural game is the Coca Cola Company. This company product

was literally an innovation introduced to the American market and diffused in other markets

around the world. It is a truly global company that even brought nations closer, to the extent


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that a countrys society is called Americanized once they start drinking Coke and eating

McDonalds. Entering the tasting panorama in the Coca Cola city, one immediately remembers

the term mass customization as a globalization strategy. You can find your can of Coke almost

everywhere in the world, but tasting so many cokes from different continents, one would

realize the difference.

Another cultural consideration can be found in Kimberly Clarks Company. The Red Spot Crisis,

that almost sank a whole product line in Kimberly Clarks was merely caused by a disregard to a

cultural sensitivity. The Companys failure, at that time, to realize that changing the color of the

Cotex packages would make them less recognizable and therefore replaced by customers, both

males and females, who are too bashful to stand for too long near the female napkins aisle in a

supermarket to look for a certain brand.

The same Company, Kimberly Clark, was too careful to stereotype certain cultures based on

books and paper. KC decided to explore the possibility to introduce detergent products in the

global market. They decided to segment target customers based on the results of an individual

customer survey on how often they prefer to clean their surrounding, and not based on the

preferred detergent fragrance in certain countries.

Another example of cultural diversity is the global localization that IBM adopts when it entrusts

its operations with managers

A company that plans to go global on a large scale can definitely use Coca Cola as a role model,

applying slight changes to satisfy different culture while still benefiting from economies of

scale. It should be careful to take culture into consideration when designing market researches,

but at the same time not be prejudiced by it. And finally any company entering a new market

with direct investment should definitely embrace the culture of workers and managers in this

country.

A general atmosphere of acceptance and respect for a different culture was felt by the

international residency participants all over Atlanta. It was clearly perceived in companies

including Piedmont Hospital, Yokogawa, Aventure Aviation, and even from sales people in


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premium outlets, Trader Joes and even restaurants. The cultural open mind and heart policy

definitely propagated for Atlanta as a destination for both business and recreation.

ENVIRONMENT:

It is often alleged that environmental costs pollution abatement, compliance and prevention

costs are negligible in comparison with other costs involved in location decisions, and

therefore low environmental standards are not an effective source of international

competitiveness. However, this does not necessarily prevent the concentration of

disproportionate environmental burdens in developing countries (vis--vis their industrialized

trade partners) basically because:

The problem is these impacts may be unforeseen when regulating authorities are only alerted

by the consequences of a certain industry after FDI is made by a certain company, not the

potential damages it causes before market entry. For example, when the Company Kimberly

Clarks first entered the Canadian market to cut woods for its pulp, no government officials and

no green groups objected. It is only after equipment has been brought in and workers hired and

KC already started to depend on material driven from this market, that the Greenpeace Group

began its fierce campaign on KC.

Therefore, companies should be not only watchful for environmental risks of a country but also

proactive on tackling them.

When performing research and intelligence a company should never ignore environmental

considerations for the following reasons:

- Naturalresource scarcity or/and abundanceare drivers of globalization, as they incite supply

and demand Forces in global markets. - The need for environmental ameliorationcan extractcosts from economy and siphon resources away From development goals.

- Signals of environmental stress travel fast in a compressed world, environmentally degraded

and unsustainable locations become marginalized from Trade, investment, etc. - Sensibilities

born out of environmental stress can push towards localization and non-consumptive


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development in retaliation to the Thrust of globalization. - Environmental stress can trigger

alternative technological paths, e.g., dematerialization, Alternative energy, etc., which may not

have otherwise emerged. Environmentalism Becomes a global norm.

Even though a developing country may not constitute a haven for polluting industries, the

environmental performance of trading national or translational industries may be considerable

lower than it would be in an industrialized country due to weaker institutions and lower

investment in environmental control. In fact, recent evidence suggests that although Mexico is

not serving as a pollution haven for American industries, the environmental condition of the

country has deteriorated at alarming rates since its full integration into the North American

Market.

- The nature of environmental challenges requires the incorporation of environmental

governance into other areas (e.g., trade, investment, health, Labor, etc.). - Stakeholder

participation in global environmental governanceespecially the participation ofNGOs and

civil societyhas become a model for other areas of Global governance.

The very nature of environmental impacts may vary from industrialized (most of them located

in temperate areas) to developing countries (many of them located in tropical and biodiversity-

rich areas). For instance, while soybean may be cultivated both in Brazil and the U.S., the

environmental consequences of soybean expansion are quite different in these countries.

Current trade-related soybean expansion into the Brazilian Amazon (in part to cover a booming

Chinese demand) may produce permanent and significant biodiversity loss, while the

environmental impacts of American soybean production is mainly associated with the use of

agrochemicals.

Given the confusing difference between environmental regulations all over the world, there is a

pressing need for meaningful global governance reform. The essential architecture of the


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international governance system remains state centric, even though neither the problems nor

the solutions are any longer so?

Environmentalism as a norm has become truly global, but so has mass consumerism. They are

so deeply weldedtogether that we simply cannot address the global environmental challenges

facing us unless we are able to understand and harness the dynamics of globalization that

influence them. Ignoring environmental costs destroys value and may at some point in the

future cost even more when environmental regulations are stricter. It is most likely; therefore,

that decreased environmental stabilitywill create more Hostile conditions for economic growth

and also place newpressures on international cooperation.

In some cases, conditions of environmental insecurityand conflict impose high costs on the

pursuit of sustainable development and are usually used as hurdles in the way of globalization.

But generally, given climate changes as the world advances key actors have begun to

recognize and some to implementthe notion that ultimately consumption will have to be

constrained. A large proportion of existing global environmental policy is therefore based on

creating, regulating and managing markets. This integration of environment into trade policy

and trade into environmental policy will only intensify.

For winners of the process, globalization becomes an integrating phenomenon when they

know how to tackle its resources and serve its purposes. One that brings together markets,

ideas, individuals, goods, services and communications. For example the IBM company is

continuously trying to benefit from the growing pro-environment and sustainability trends. It

has been working for years on introducing innovations for home and company appliances that

would save water and energy, and help recycle resources. It has been making very lucrative

profits selling these appliances to individuals and corporations. The new development by IBM

to serve the higher call of earth is to become the champion of Atlanta Smarter City.


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INFORMATION TECHNOLOGY:

Information Technology (IT) is a driving factor in the process of globalization. Improvements in

the early 1990s in computer hardware, software, and telecommunications have caused

widespread improvements in access to information and economic potential, These advances

have facilitated efficiency gains in all sectors of the economy. IT provides the communication

network that facilitates the expansion of products, ideas, and resources among nations and

among people regardless of geographic location. Creating efficient and effective channels to

exchange information, IT has been the catalyst for global integration.

But perhaps most dramatically, just ten years ago, only scientists were using, or had even heard

about, the Internet, the World Wide Web was not up and running and the browsers that helpusers navigate the web had not even been invented yet. Today, of course, the Internet and the

Web have transformed commerce, creating entirely new ways for retailers and their customers

to make transactions, for businesses to manage the flow of production inputs and market

products, and for job seekers and job-recruiters to find each other. The news industry has also

been dramatically transformed by the emergence of numerous Internet-enabled news-

gathering and dissemination outlets, and sale and marketing as well. Websites, chat rooms,

instant messaging systems, e-mail, electronic bulletin boards and other Internet-based

communication systems have made it much easier for people with common interests to find

each other, exchange information, and collaborate with each other. This has been much help

for small and medium enterprises to grow quickly despite the tough competition they face

locally. For example, companies like Aventure Aviation and AJC located in Atlanta, USA, could

speak to potential customers and conclude deals all over the world, so the world has become

their market, and also their warehouse.

Education at all levels is being transformed by communication, educational, and presentational

software and by Websites and other sources of information and analysis on the Internet, this

would help companies of course not only market their products but also help their customers

use their products through videos and chats and even social media.


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Another set of advances that has been critical to the IT revolution has occurred in fiber optics.

Fiber optics technology enables data, including voices captured in digital form, to be converted

into tiny pulses of light and then transmitted at high speeds through glass fibers wrapped into

large capacity telecommunication cables. Hundreds of thousands of miles of these cables have

been installed over the past ten years, boosting the speed and capacity of telecommunications

networks.

Globalization and information technology had been widely accepted as two sides in one coin,

we can not ignore the effect of globalization in developing information technology and also the

impact of information technology development in globalizations. Many companies find in IT an

opportunity for globalizations by offering a new product customized product needed in a

specific countries like Oracle creating the localizations in its produced applications and also

through the large acquisitions done during the first 10 years on this century. Also from another

side, information technology held the organization management in a position where a

completion is the main focus and core by supporting the right information in the right time to

the right responsible.

GENERALLY, TO BE A FLAT WORLD COMPANY , WE SHOULD :

1. Strike the right balance between enforcement and empowerment2. Choose speed, agility and innovation over old ways3. Know how much every project/resource group is costing you4. Outsource if it makes sense5. Use compliance as a positive to drive internal processes and system improvements6. Define project- and process- based roles not rigid job titles


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PART II: SUCCESSES AND FAILURES OF GLOBALIZATION:

True that the spread of information technology has brought nations closer and showed youth

around the world not only the norms and habits of other nationalities but has also helped

reduce xenophobia. For globalization and the internet, youth of Arab nations should be grateful

for they greatly supported their revolutions towards a more dignified life.

Globalization could also take credit for sending job opportunities to developing nations, but

what kind of employment and what kind of payment to them? That is the main question that

the teams opinion revolves around.

Modern economy has witnessed how globalization works among and between developed and

underdeveloped nations. But soon after the global financial meltdown, negative effects of

globalization are highly magnified nowadays.

For developed economies, globalization is probably taken as a good thing since it assures the

continuous flow of their previously advanced exchange of goods and services. In contrary,

underdeveloped countries may consider globalization as the possible reason why they are

suffering from a more serious economic demise than ever before.

In globalization, no fair ground has been determined to serve as the reference or starting

point for the actual production of goods and services. With globalization immediately hitting

the world economic scene, underdeveloped countries are, unsurprisingly outstripped by

previously established economies.

Melting the boundaries by decreasing the protection tariff did not give enough time to those

countries to build their internal capabilities and enhance their skills to be able to compete

globally. Therefore, in many cases local industries were crashed by the incoming competition

and were replaced by low value added production and jobs that serve as inputs for the more

developed countries.

Globalization models of the Far East, China, India and Korea, are widely celebrated examples of

how globalization can benefit whole countries and change the balance of trade around the


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world. One should not forget, however, that these countries started working on themselves at

least two decades before all trade obstacles were removed. They kept building their capacity

like a pressure cooker building steam, and when the time was right the whole world was

surprised with the Tigers unleashed. India for example created a class of Diaspora of highly

educated and skillful technicians and scientists in the West pharmaceutical industry. They

brought them back to build their own local industry. At the first chance of an open market in

the West, they were ready to jump into the markets they previously grew in.

But the fact is that the train of globalization has moved and there is no way to stop it. Like it or

not you have to work with it. Humanitarians and greens can put limits to its cruelty, but if a

nation depends on the outcomes of this green effort, they will always be the victims.

So any country has to work on being winners. And by winners we dont mean good balance of

trade only, but good quality of life and sustainability for citizens. That's what national plans

should be put to achieve, not only money.

Now what should a country do to face the global competition There a solution for being

overrun by globalization , from the point of view of developing countries.

The example of European Union can be replicated in a regional united market, like an African

continent market

A developing country can also use globalization to its benefit not the contrary by trying to build

small high quality businesses that would sell and compete around the world, like the Chinese

example but on a smaller scale.

Another option is to temporarily reinstitute some barriers to protect certain industries for a

specific period of time and develop internally, until being relatively ready for competition.

The team opinion on globalization was formed after reading the following literature review:


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LITERATURE REVIEW

GLOBALIZATION THE FLAT WORLD

Thomas Friedman has said Globalizationis the tendency of investment funds and businesses

to move beyond domestic and national markets to other markets around the globe, allowing

them to become interconnected with different markets. Proponents of globalization say that it

helps developing nations "catch up" to industrialized nations much faster through increased

employment and technological advances and Asian economies are often highlighted as

examples of globalization's success. Critics of globalization say that it weakens national

sovereignty and allows rich nations to ship domestic jobs overseas where labor is much

cheaper. What is the real story on globalization? It largely depends on your personal

perspective. In this article, we'll examine the issue from both sides.

Thomas Friedman defended his point of view by saying :

Globalization is a fervidly contested and often misunderstood concept. It has occupied and

divided economists, sociologists and anti-capitalists alike. Anti-globalization protestors picketed

World Trade Organization summits in a stand against the might of globalization. Yet, many

economists tout the benefits of increased trade, sophisticated telecommunications networks

and cross-border investment to developing countries, and worker gains from closer

integration.

The driving idea behind globalization is free-market capitalism -- the more you let market forces

rule and the more you open your economy to free trade and competition, the more efficient

and flourishing your economy will be. Globalization means the spread of free-market capitalism

to virtually every country in the world. Globalization also has its own set of economic rules --

rules that revolve around opening, deregulating and privatizing your economy.

Different Opinions :
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Reading from Cavanagh, Alternatives to Economic Globalization

CORPORATE GLOBALISTS VS. CITIZENS MOVEMENTS:

The corporate globalists who meet in posh gatherings to chart the course of corporate

globalization in the name of private profits, and the citizen movements that organize to thwart

them in the name of democracy, are separated by deep differences in values, worldview, and

definitions of progress. At times it seems they must be living in wholly different worlds which,

in fact, in many respects they do. Understanding their differences is key to understanding the

implications of the profound choices humanity currently faces.

Corporate globalists inhabit a world of power andprivilege. They see progress at hand

everywhere, because from their vantage point the drive to privatize public assets and free the

market from governmental interference spreads freedom and prosperity around the world,

improving the lives of people everywhere and creating the financial and material wealth

necessary to end poverty and protect the environment. They see themselves as champions of

an inexorable and beneficial historical process toward erasing the economic and political

borders that hinder corporate expansion.

Citizen movements, on the other hand, see a very different reality. Focused on people and the

environment, they see a world in a crisis of such magnitude that it threatens the fabric of

civilization and the survival of the speciesa world of rapidly growing inequality, erosion of

relationships of trust and caring, and failing planetary life-support systems. Where corporate

globalists promote the spread of market economies, citizen movements see the power to

govern shifting away from people and communities to financial speculators and to global

corporations dedicated to the pursuit of short-term profit in disregard of all human and natural

concerns. They see corporations replacing democracies of people with autocracies of money,replacing self organizing markets with centrally planned corporate economies, and replacing

diverse cultures with cultures of greed and materialism.

It becomes more imperative to rethink human priorities and institutions by the day. Yet most

corporate globalists, in deep denial, reiterate their mantra that with time and patience


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corporate globalization will create the wealth needed to end poverty and protect the

environment.

Citizen movements counter that the policies and processes of corporate globalization are

destroying the real wealth ofthe planet while advancing a primitive winner-takes-all

competition that inexorably widens the gap between rich and poor. They reject as absurd the

argument that the poor must be exploited and the environment destroyed to make the money

necessary to end poverty and save the planet.

The challenge of providing leadership to create a just and sustainable world thus falls by default

to the hundreds of millions of extraordinary people in an emerging global civil society who

believe a better world is possibleand who are forging global alliances that seek to shift the

powers of governance to democratic, locally rooted, human-scale institutions that value life

more than money. Although the most visible among them are those who have taken to the

streets in protest, equally important and even more numerous are those struggling to rebuild

their local communities and economies in the face of the institutional forces aligned against

them.

The current and future well-being of humanity depends on transforming the relationships of

power within and between societies toward more democratic and mutually accountable modes

of managing human affairs that are self-organizing, power-sharing, and minimize the need for

coercive central authority. Economic democracy, which involves the equitable participation of

all people in the ownership of the productive assets on which their livelihood depends, is

essential to such a transformation because the concentration of economic power is the Achilles

heel ofpoliticaldemocracy, as the experience of corporate globalization demonstrates.

Colin Dodds discussed globalization in relation to corporate governance. He believes that the

problems of adjustment to globalization will involve relevance of broader concepts of agency

responsibilities, as adjustment tasks involve workers, suppliers and distributors as well as

managements and shareholders. The literature shows conferences held to discuss comparative

corporate governance.


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Boyd and Cohen argued that structural interdependencies resulted from transactional activities

among firms in diverse nations like US, Japan, and Europe. This diversity includes distinctive

cultures, structures, laws and financial systems. Moreover globalizing product markets creates

pressures for convergence in corporate governance, organizational development and

strategies. They highlighted the international financial markets as drivers of the most urgent

questions when economic cooperation is deepened. These questions will quickly extend to a

broad range of public policies and national preferences in political economic organizations.

In his article Fear of Globalization: the Human Nexus, Cohen found that social returns to

education have been higher in poor countries. This contradicts what he believes a conventional

wisdom that poor countries should experience a decline in their returns to education as

globalization raises the demand for low skilled workers in the South. He showed in his article

that in fact openness raises the returns to education in poor countries. It also showed that

countries that opened their economies in the past two decades experienced a significant

increase in inequality, while those whose economies were already open did not. In general, he

says it is not surprising that complains about globalization date back to the Roman Empire that

complained that India, China and Arabia robbing our Empire on hundred million sesterces

every year; and are found both in the North and the South. He believes that globalization is a

shock that alters the distribution of income among agents and sectors. He uses an example of

North-South trade to argue that globalization is potentially a vector of rising inequality in the

North but declining in the South, for it derives down the demand for unskilled labor in the

North and the demand for skilled labor in the South. Other culprits cited for rising inequality in

the 80s are skill-biased technologies and labor market deregulation. Cohen used empirical data

and conducted group case studies on countries to study globalization. He came up with results

that supported the view that in closed economies education is useful only to reach social.

Stiglitz is a Nobel award winner for his work in the important of information for Market, can be

classified as anti globalizations, he argues that one of his task want to work for is shaping the


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globalizations, Stiglitz outlines that his next book will look at how the financial crisis has

affected globalization and undermined Americas credibility on economic policy.

In his book Globalization and its Discontents. Everyone favors free tradeexcept many of the

people who make things and sell them. Eliminating tariffs, quotas, subsidies, and other barriers

to free trade usually has little to do directly with what has driven a country to seek an IMF loan;

but the IMF usually recommends eliminating such barriers as a condition for receiving credit.

The argument is the usual one, that in the long run free trade practiced by everyone benefits

everyone: each country will arrive at the mixture of products that it can sell competitively by

using its resources and skills efficiently. Stiglitz points out that today's industrialized countries

did not practice free trade when they were first developing, and that even today they do so

highly imperfectly. Stieglitz argues that forcing today's developing countries to liberalize their

trade before they are ready mostly wipes out their domestic industry, which is not yet ready to

compete.

Also one of major globalization indirect initiation is privatizations, Stieglitz argues that many of

countries where privatized their own asset enterprises does not yet have financial systems

capable of handling such transactions, or regulatory systems capable of preventing harmful

behavior once the firms are privatized, or systems of corporate governance capable of

monitoring the new managements. Especially in Russia and other parts of the former Soviet

Union, he says, the result of premature privatization has been to give away the nation's assets

to what amounts to a new criminal class.

We have also witnessed the rise and globalization of the 'brand'. It isn't just that large

corporations operate across many different countries - they have also developed and marketed

products that could be just as well sold in Peking as in Washington. Brands like Coca Cola, Nike,

Sony, and a host of others have become part of the fabric of vast numbers of people's lives.

Globalization compresses the time and space aspects of social relationsJames Mittelman,

Professor of International Relations at American University.


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Globalization involves the diffusion of ideas, practices and technologies. It is something more

than internationalization and universalization. It isn't simply modernization or westernization.

It is certainly isn't just the liberalization of markets. Anthony Giddens (1990: 64) has described

globalization as 'the intensification of worldwide social relations which link distant localities in

such a way that local happenings are shaped by events occurring many miles away and vice

versa'.

This involves a change in the way we understand geography and experience localness. As well

as offering opportunity it brings with considerable risks linked, for example, to technological

change.

The transformation of Political power?1

Mitigated by defensive and protectionist trade policies, while monetary adjustment was far

from automatic. The richer nations often ran large surpluses and some emerging economies

large deficits, but high levels of foreign investment allowed this to persist without straining the

gold standard system. In addition, there were huge migratory7 flows of unemployed labor from

Europe to expanding economies.

In the 1960s national capital controls were steadily evaded through growing Euro-currency

markets in which national currencies, deposits and assets were traded in offshore locations.

International bank lending was revitalized by the recycling of petrodollars that followed the

OPEC oil price hikes. Evasion of national capital controls, aided by new telecommunication

technologies and combined with a political revaluation of the virtues of free international

capital movement, led to the steady dismantling of capital controls and a loosening of the

defensive regulation of national financial markets: in the late 1970s in the US and Canada, in

the early 1980s in Japan, Australasia and the UK, and the rest of Western Europe in the late

1980s and early 1990s, partly in response to the provisions of the Single European Market. In

1David Goldblatt, David Held, Anthony McGrew, Jonathan Perraton


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the mid-1990s cautious liberalization continues in many developing economies and in Eastern

Europe.

The View from the Penthouse

For business leaders and members of the economic elite, globalization is good. Cheaper labor

overseas enables them to build production facilities in locations where labor and healthcare

costs are low and then sell the finished goods in locations where wages are high. Profits soar

and Wall Street rewards big profit gains with higher stock prices. TheCEOsof global companies

also get credit for the profits.

The View From the Street

On the other hand, competition for jobs stretches far beyond the immediate area in a global

marketplace. From technology call centers in India, to automobile manufacturing plants in

China, globalization means that workers must compete with job applicants from around the

world.

TheNorth American Free Trade Agreement(NAFTA) sent the jobs of U.S. autoworkers to

Mexico, where wages are significantly lower than those in the U.S. A few years later, some of

those same jobs were relocated to third-world countries in East Asia, where wages are even

lower. In both cases, the auto manufacturers expected U.S. consumers to continue buying at

U.S. prices. While critics of globalization decry the loss of jobs for developed countries, those

who support it argue that the employment and technology brought to developing countries

helps them industrialize and possibly increase standards of living.

The View from the Middle Ground

In the globalization battleground,outsourcingis a double-edged sword.

On the one hand, low wages in foreign countries enable retailers to sell at reduced rates in

western nations where shopping has become an ingrained part of the culture. This allows

companies to increase their profit margins.

At the same time, shoppers save money when they buy these goods, which may lower wages,
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but also lower prices.

Lower-income workers who have mutual funds holdings also enjoy some of the benefits of

stock price appreciation.

The Effects of Globalization

The ever-increasing flow of cross-border traffic in terms of money, information, people and

technology isn't going to stop.

While global standards of living have risen as industrialization takes root in third-world

countries, they have fallen in developed countries. Today, the gap between rich and poor

countries is expanding as is the within these countries.

Homogenization of the world is another result, with the same coffee shop on every corner. So,

while globalization does promote contact and exchange between cultures, it also tends to make

them more similar to one another. At the market level, linked global financial markets propel

local issues into international problems, such as meltdowns in Southeast Asia to Russian debt

defaults.

What lies ahead?

The massive outsourcing of U.S. manufacturing jobs that began decades ago Now includes

white collarjobs, such as call center workers, medical technicians and accountants leavingmany to argue that those profiting from the arrangement have little incentive to change it,

while those most impacted by it are virtually powerless.

Rising tide doesn't necessarily lift all boats. True abut CEO compensation and low-wage

workers who get hurt the most because they don't have transferable skills. Until a better

solution is found, education, flexibility and adaptability are the keys to survival that politicians

and business leaders agree on .
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THE MAIN DEBATE :

MEANING: PROCESS VS. PROJECT

According to one popular view, globalization is the "inexorable integration of markets, nation-

states and technologies to a degree never witnessed before-in a way that is enabling

individuals, corporations and nation-states to reach round the world farther, faster, deeper and

cheaper than ever before" (T. Friedman, The Lexus and the Olive Tree, 1999). By contrast, some

groups of scholars and activists view globalization not as an inexorable process but as a

deliberate, ideological project of economic liberalization that subjects states and individuals to

more intense market forces (P. McMichael, Development and Social Change, 2000; P. Hirst and

G. Thompson, Globalization in Question, 1996).

2.Interpretation: New Era vs. Nothing New

Discussions of globalization often convey a sense that something new is happening to the

world: it is becoming a "single place" and experienced as such (R. Robertson, Globalization,

1992), global practices, values, and technologies now shape people's lives to the point that we

are entering a "global age" (M. Albrow, The Global Age, 1997), or global integration spells the

end of the nation-state (K. Ohmae, The End of the Nation-State, 1995). A new world order is

emerging, according to "hyperglobal" accounts (Held et al., Global Transformations, 1999).

Sceptics counter that there is nothing new under the sun since globalization is age-old

capitalism writ large across the globe (I. Wallerstein, "Globalization or The Age of Transition?",

1999), or that governments and regions retain distinct strengths in a supposedly integrated

world (Hirst and Thompson, 1996), or that the world is actually fragmenting into civilizational

blocs (S. Huntington, The Clash of Civilizations and the Remaking of World Order, 1996).

3. Evaluation: Good vs. Bad

Globalization used to be widely celebrated as a new birth of freedom: better connections in a

more open world would improve people's lives by making new products and ideas universally
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available, breaking down barriers to trade and democratic institutions, resolve tensions

between old adversaries, and empower more and more people (cf. T. Friedman, 1999; J.

Mickelthwait/A. Wooldridge,A Future Perfect, 2000). Many leaders in the West supported the

advent of a new world order through free trade and political cooperation. By the late 1990s,

cheerleading turned into jeremiads, a banner became a bull's-eye. The term globalization was

used increasingly to express concern about the consequences of global change for the well-

being of various groups, the sovereignty and identity of countries, the disparities among

peoples, and the health of the environment (cf. Hirst and Thompson, 1996; J. Mittelman, ed.,

Globalization: Critical Reflections, 1996). Politicians opposed to America's global influence and

activists opposed to the inequities of oppressive global capitalism now portray globalization as

dangerous. Globalization has thus become an issue in a wide-ranging global debate.

4. Explanation: "Hard" vs. "Soft"

Many authors attribute the dynamics of globalization to the pursuit of material interests by

dominant states and multinational companies that exploit new technologies to shape a world in

which they can flourish according to rules they set (I. Wallerstein). An alternative view suggests

that globalization is rooted in an expanding consciousness of living together on one planet, a

consciousness that takes the concrete form of models for global interaction and institutional

development that constrain the interests of even powerful players and relate any particular

place to a larger global whole (R. Robertson, 1992; J. Meyer et al., "World Society and the

Nation-State,"Am. J. of Soc. 1997)

5.Political: End vs. Revival of Nation-State

According to one line of argument, globalization constrains states: free trade limits the ability of

states to set policy and protect domestic companies; capital mobility makes generous welfare

states less competitive; global problems exceed the grasp of any individual state; and global

norms and institutions become more powerful. Others suggest that in a more integrated world

nation-states may even become more important: they have a special role in creating conditions

for growth and compensating for the effects of economic competition; they are key players in


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organizations and treaties that address global problems; and they are themselves global models

charged with great authority by global norms.

6. Cultural: Sameness vs. Difference

A standard complaint about globalization is that it leads to cultural homogeneity: interaction

and integration diminish difference; global norms, ideas or practices overtake local mores;

many cultural flows, such as the provision of news, reflect exclusively Western interests and

control; and the cultural imperialism of the United States leads to the global spread of

American symbols and popular culture (cf. H. Schiller, Mass Communications and American

Empire, 1969; C. Hamelink, The Politics of World Communication, 1994). The counterargument

stresses new heterogeneity that results from globalization: interaction is likely to lead to new

mixtures of cultures and integration is likely to provoke a defense of tradition; global norms or

practices are necessarily interpreted differently according to local tradition, and one such norm

stresses the value of cultural difference itself; cultural flows now originate in many places; and

America has no hegemonic grasp on a world that must passively accept whatever it has to sell .

The "globalization debate." Some see it as a battle between optimism and pessimism. Others

see it not as a debate at all, but as an ongoing quest to find the best uses of increased

interconnectedness in today's global society.

Part of the reason for such varied viewpoints is linked to the fact that the term "globalization"

means so many different things depending on who you ask.

Note that although we have divided the following into pro- and anti-globalization viewpoints,

very few of the writers stand firmly on one side of the issue. Instead, many of these quotations

are fraught with mixed feelings on the potential advantages and dangers of globalization.

Additionally, some critics complain that the very term "globalization" is too loaded with

multiple meanings to hold any significance whatsoever.

Pro-Globalization Anti-Globalization


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"Globalisation is generating great wealth.

This could be used to massively reduce

poverty worldwide and to reduce global

inequality.... We must try to manage this

new era, in a way which...helps to lift

millions of people out of poverty."

- Clare Short, UK Secretary of State for

International Development

"The increasing globalization of U.S. corporations gives

them the leverage to hold down wages and resist

unionization. Average real wages (corrected for inflation)

have been falling since the early 1970s. By 1992, average

weekly earnings in the private, non-agricultural part of

the U.S. economy were 19 percent below their peak in

the early 1970s. Nearly one-fourth of the U.S. workforce

now earns less in real terms than the 1968 minimum

wage!"

- Kevin Danaher,"Globalization and the Downsizing of

the American Dream"

"Globalisation, then, is growth-promoting.

Growth, in turn, reduces poverty.... the

liberalisation of international transactions is

good for freedom and prosperity. The anti-

liberal critique is wrong: marginalisation is in

large part caused by not enough rather than

too much globalisation."

- Razeen Sally, London School of Economics

"U.S.-style globalism not only attempts to suppress

labor, but also seeks to suppress social welfare systems

and support for public expenditures that do not directly

benefit the expansion of capital. The social welfare

system and other public services, such as schools, social

services in the North and food subsidies in the South, are

supported through taxes, and taxes reduce short-term

benefits to capital."

- John A. Powell and S.P. Udayakumar, University of

Minnesota Law School in"Poverty & Race"

Agreements like NAFTA and the WTO force

nations to respect contracts, which

encourages responsible investment and,

hence, economic growth. And, you see,

economic growth creates a middle class, anda middle class, eventually, demands

democracy. That is the story of the 20th

century and, God willing, it will be the story

of the 21st."

"While globalisation has led to benefits for some, it has

not led to benefits for all. The benefits appear to have

gone to those who already have the most, while many of

the poorest have failed to benefit fully and some have

even been made poorer."

- Duncan Green & Claire Melamed,A Human

Development Approach to Globalisation
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- Jonah Goldberg, National Review Online

FRIEDMAN VS. KORTEN ON GLOBALIZATION

Thomas Friedman--Global Economy& consumer

culture to support corporate interest

David Korten--Localized global system &

sustainable living to support human interest

1. Global Economy 1. Local Economies

2. Global Free Markets 2. Managed Local Markets

3. Electronic Herd 3. Local, Democratic Control

4. Golden Straitjacket 4. Local Rules & Culture

5. Global Culture 5. Diverse Local Cultures

6. Fast World--constant

change in culture & tradition

6. Slow World--respect

culture & tradition

7. Market-Controlled 7. Locally-Controlled

8. Value money, material

wealth, & individual freedom

8. Value love, family,

and community

9. Democracy of Wealth 9. Democracy of Citizens

10. Little to no Social

Contract--Market dictates

10. Social Contract--

safety net for the poor

11. Protect material wealth

over the Environment

11. Protect the Environment

over material wealth

12.Protect Money & property 12. Protect Human Rights &


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over Human Rights and quality of life quality of life over money

& property rights

13. Fast World--value change over culture & traditon 13. Slower World--value

culture and tradition

14. Pursue ever higher

standard of living & wealth

14. Pursue quality of life

and human well-being

15. See Corporations as

People with legal rights

that society can't violate

15. See Corporations as

socially-created, dependent

on society for their rights.

16. Protect Corporations &

wealth over human interest

16. Protect human interest

over Corporations & wealth

17. Value individualism

and competitiveness

17. Value the common

interest and public good

ADDITIONAL REFERENCES:

1.The World Is Flat:Author: Thomas L. Friedman2.http://www.carnegiecouncil.org/resources/publications/dialogue/1_11/relevance_social/588.html3.http://www.colorado.edu/AmStudies/lewis/ecology/versus.htm4.http://www.colorado.edu/AmStudies/lewis/ecology/roots.htm5.Alternatives to Economic Globalization - John Cavanagh,6. Sense and nonsense in the globalization debate. By Rodrik, Dani.
http://www.carnegiecouncil.org/resources/publications/dialogue/1_11/relevance_social/588.htmlhttp://www.carnegiecouncil.org/resources/publications/dialogue/1_11/relevance_social/588.htmlhttp://www.colorado.edu/AmStudies/lewis/ecology/versus.htmhttp://www.colorado.edu/AmStudies/lewis/ecology/versus.htmhttp://www.colorado.edu/AmStudies/lewis/ecology/roots.htmhttp://www.colorado.edu/AmStudies/lewis/ecology/roots.htmhttp://www.colorado.edu/AmStudies/lewis/ecology/roots.htmhttp://www.colorado.edu/AmStudies/lewis/ecology/versus.htmhttp://www.carnegiecouncil.org/resources/publications/dialogue/1_11/relevance_social/588.html

Globalization Group Project GhadaKarimMohamedWalid

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