Globalization and Its Discontents

1
Globalization and Its Discontents
2
IR Theories on the EU

• Liberalism
• Institutions
• Domestic politics and intergovernmental bargains
• Functionalism functional spillover
• Constructivism
• Norms of democratic community
• Realism?

3
Globalization

• Globalization Global networks of interdependence
  (Nye 2004)
• Interdependence mutual dependence of actors
  across different parts of the international
  system (Keohane and Nye 1977)
• globalization is about connections between
  different region of the world-from the cultural
  to the criminal, the financial to the
  environmental-and the ways in which they change
  and increase over time.(Held et al. 1999)

4
Elements of Globalization

• Trade
• Exports 66bn (1960) -7,100bn (2002)
• International finance
• FDI 68bn (1960) 7,100(2002)
• Multinational corporations
• 3,500 (1960) to 65,200 (2001)
• Regional integration

5
Elements of Globalization

• Cultural globalization
• Disease
• Environmental interdependence
• Population and migration
• Transnational trafficking networks
• Transnational terrorism

6
Trends FDI Flows
7
Trends Trade Flows
8
Sources of Globalization

• Technology
• Triumph of liberalism
• Francis Fukuyama The End of History?
• Washington Consensus
• Institutions
• WTO
• International Monetary Fund (IMF)
• World Bank

9

• Is Globalization Good or Bad?

10
Benefits of Globalization

• Access to information
• Access to goods
• Access to technology
• Access to capital

11
The Risks of Globalization

• States lose control
• Heightened vulnerability
• Benefits distributed asymmetrically
• Economic objectives trump social, cultural,
  environmental objectives

12
Case From the Asian Miracle to the Asian
Financial Crisis

• The miracle
• South Korea 7-8average growth 1970s-1990s
• Thailand 7-8.5 growth rate 1960-1980s
• 1990s rapid financial market liberalization
• 1997 Financial Crisis
• Thailand fear of currency devaluation-gtsell
  baht-gtcurrency devaluates-gtcapital flight
  financial instability
• Korea rumor that economy in trouble/bank will
  not renew loans -gt banks unwilling to renew loans
  -gteconomic trouble due to high indebtedness
• Korea GDP -7 Thailand GDP -11

13
Case Intellectual Property Rights(Biopiracy)

• Mexican yellow bean
• Larry Proctor (Colorado) patent on Enola bean,
  originally from Sonora (Mexico)
• Basmati rice
• RiceTec Inc (Texas)-Texmati Rice patent

14
The global banana

• Distribution of a dollar of retail revenue
• Producer income 0.05
• Export costs 0.04
• Transport 0.11
• Import license 0.09
• Ripening process 0.05
• Taxes 0.15
• Distribution/retail 0.34
• Profit 0.17
• Source Lipschutz,2004, p. 2

15
The Backlash Seattle 1999
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Solutions, Solutions.The Role of Institutions

• Keynesian welfare politics?
• Domestic institution?
• Gradual liberalization, mitigated by government
  policies?
• Strengthen international institutions?
• Tackle poverty?