Globalization, Social and Economic Aspects of
Globalization, Social and Economic Aspects of
Since the 1970s and 1980s, the increasing intensity of international economic exchange, the rising prominence and influence of international organizations, the diffusion of cultural products across national boundaries, the spanning of social ties across international borders, and global environmental problems have all placed globalization prominently on the agenda of social science. The definition of globalization remains contested, but globalization can be conceptualized as a multidimensional process of international network formation. (Globalization could also be understood as an ideology, but this would more accurately be termed globalism.) The network metaphor clarifies the concept of globalization by highlighting both the nodes (e.g., people, organizations, and states) and the relations (e.g., trade, investment, organization membership, consumption, and migration) that are central to the globalization process. Thinking about globalization as multidimensional network formation is also a useful heuristic for understanding the established facts and unresolved debates surrounding the phenomenon. Moreover, it helps differentiate the multiple levels of analysis inherent in the process: globalization involves local, regional, national, international, and world levels of social life.
Below, this entry employs the network heuristic to discuss the central issues in the social science of globalization. The discussion begins by exploring relatively settled terrain: the multiple dimensions of globalization. From there, the entry moves to rockier ground: the questions of whether globalization is really new, how extensive it is, and precisely what effects it has.
Cross-national connections are created in the economic, political, cultural, social, and environmental domains. Although these dimensions necessarily overlap, it is analytically useful to distinguish them. Economic globalization results when corporations go multinational, either by selling their products in other countries, buying corporations located in foreign countries, or opening branch offices or subsidiaries outside their home country. Multinational corporate expansion, and the consumption of foreign-sourced goods and services, aggregate into exports, imports, and investment relations among national economies. Political globalization, or the formation of international connections among elected officials, bureaucrats, judges, social movement activists, and states, has also generated intense interest. Political globalization results in part through the formation of intergovernmental organizations (IGOs) like the United Nations and the World Trade Organization, and international nongovernmental organizations (INGOs) like the International Committee of the Red Cross. For instance, Anne-Marie Slaughter (2004) shows how political officials, especially regulators and judges, weave a web of global governance and “world order” through international ties formed by these organizations.
In the cultural field, the major world religions, media conglomerates, multinational corporations, and international tourism transmit and translate meaning (embedded in faith traditions, ideas, products, and practices) and symbols across international boundaries. The development of the international communication infrastructure (radio, satellites, intercontinental telecommunication cables) and the rapid expansion of communication technologies (Internet, cell phones, television) foster this process. Closely related is social globalization, or transnational connections formed by mobile individuals as they create social relationships. For instance, the density of international ties across countries grows as migrants maintain connections to their origin countries (e.g., through remitting money back home) while building new relationships in their destination countries (e.g., through work, community, and family).
Many identify the environment as a fifth dimension of globalization. If nations are the nodes in international networks, then environmental problems create connections by crossing borders: global warming, ozone depletion, and acid rain have all been defined by social movement activists and scientists as international problems that require international solutions. Indeed, environmental problems illustrate how the various dimensions of globalization sometimes reinforce one another: social movement activists bind together through international social movement organizations (social globalization) to spread awareness of environmental problems (cultural globalization) caused in part by multinational corporations (economic globalization), and urge the adoption of international agreements like the 1997 Kyoto Protocol on greenhouse gas emissions (political globalization).
While the example of the Kyoto Protocol illustrates how the dimensions of globalization can cohere, intense international debate over the protocol raises questions about the pace and periodization of globalization, and, more fundamentally, about how “global” globalization is. Indeed, debate over the timing and extent of globalization animates much research. For instance, world-systems theorists such as Immanuel Wallerstein and Christopher Chase-Dunn trace the millennia-long evolution of international economic and political systems, and world-society theorists such as John Meyer and John Boli view social and cultural globalization through a long historical lens that looks back over a century. Social scientists have not reached consensus on when globalization in its various forms began, but there is an emerging consensus that the world has experienced a renewed and possibly distinct economic globalization since the mid-1970s (i.e., after the oil crises and the collapse of the Bretton Woods system of fixed exchange rates in 1973). Only during this period did the level of international trade surpass its previous peak in the early twentieth century. Thus, economic globalization may follow waves, with crests of integration followed by troughs of separation.
In the political dimension, there is also evidence that globalization substantially intensified in the latter half of the twentieth century. With the establishment of the United Nations and related IGOs (including the International Monetary Fund, World Bank Group, International Labour Organization, and World Health Organization), a global governance framework emerged. It has fostered the creation of thousands of intergovernmental and nongovernmental organizations that generate a network of international association (Boli and Thomas 1999). Key nodes in this network include regional organizations like the European Union (EU) that liberalize trade and create common policies among nations within negotiated geographical boundaries. The EU has progressed furthest toward the creation of a regional market and government, as it has allowed the free movement of people across borders, eliminated barriers to trade, created a supranational court, and established supranational policies. The EU, established as the European Economic Community in 1957, may have inspired regional integration efforts in other parts of the world, including Southeast Asia—the Association of Southeast Asian Nations (ASEAN, 1967); South America—Mercado Común del Sur (Southern Common Market or Mercosur, 1991); North America—the North American Free Trade Agreement (NAFTA, 1994); Central America—the Central American Common Market (CACM, 1960); and Africa—the Organization of African Unity (OAU, 1963). These organizations may transform world politics by changing how states interact and by generating new layers of policy and politics.
The accelerating economic liberalization and polity construction within geographical regions fuels the debate over where globalization actually happens (indeed, a large literature addresses whether regional integration creates “stepping-stones” or “stumbling blocks” to a fully integrated global system). Here again, the network heuristic helps. Some images of globalization depict a world where national nodes worldwide are increasingly interconnected without regard to place, while others allow for a more fragmented and uneven network where some nodes are linked much more densely than others. These contrasting images manifest in research that has shown, for instance, that Western Europe is much more densely intertwined in both the economic and political dimensions than nations in other world regions.
Setting aside controversies of period and place, social scientists blame or credit globalization for a panoply of social ills and goods, from economic inequality to economic growth, from political domination to democratization, from the decline of national sovereignty to the renaissance of the state, from social engagement to xenophobia, and from cultural homogenization to ethnic conflict. Meanwhile, others see a feeble globalization. Here, this entry reviews some of the key arguments for what globalization does.
Globalization, advanced partly by IGOs like the World Trade Organization and the International Monetary Fund that compel economic liberalization, has been the subject of vigorous debate about growing income gaps between rich and poor. The argument is that, in the name of international competitiveness, government revenue and expenditures are cut, and industries are deregulated and privatized. Globalization is also blamed for lowering the wages of less-skilled workers by shifting manufacturing jobs to lower-wage countries, and by enlarging the pool of low-wage labor through immigration. In turn, in low-wage countries of the “Global South,” globalization is blamed for proliferating sweatshops owned by multinational corporations, producing an underclass of nonunionized labor, and generating an exploitive transnational capitalist and entrepreneurial class. Moving from individuals to countries, globalization arguably benefits rich countries at the expense of poor countries, by further concentrating wealth in rich countries as profits are repatriated from the Global South to the Global North. On the other hand, much of the literature has been skeptical of the criticisms that have been leveled at globalization. Just to take one example of the potentially salutary effects of globalization, it has been argued that globalization actually reduces disparities among rich and poor countries in their overall levels of economic development, by spreading industrialization to poor countries.
Social scientists also disagree intensely over whether globalization brings about political convergence among states. There is evidence that states adopt increasingly similar policies in areas such as education, welfare, the environment, human rights, and population as they interact more with international organizations. International organizations, it is argued, create and diffuse policy models (or “scripts”) to states, and states adopt these models, in part, to appear as legitimate members of a world society. This process may reflect the spread of modern, Western culture (e.g., individualism, universalism, rationalism, science, and progress) around the globe. These claims remain controversial, and some argue that international organizations serve national interests and as such have strictly limited independent influence. It is a major challenge to contemporary social science to bring some resolution to the varied, contradictory, and multivalent picture of globalization that has emerged.
SEE ALSO International Nongovernmental Organizations (INGOs); Internet; Transfer Pricing; Transnationalism; World Trade Organization
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