Globalization is an economic, political, social and cultural phenomenon which involves the integration of nations, economies and people on a multilayered platform. Though globalization started as an economic system, it has lead to a cross cultural exchange on almost every aspect of life. It has its advocates on both sides.
Why should I be aware of this?
- While the pro-globalization parties consider it a positive force for economic growth, prosperity and democratic freedom, the anti-globalization forums look upon it as a tool for the exploitation of the developing world and an Americanization of the world. It is a complex phenomenon with contradictory tendencies.
All about globalization
Many experts feel that globalization is not a new phenomenon. Since centuries, humans have established contacts with each other through many channels -- be it trade, knowledge or wars and conquests. While there are a lot of similarities between the previous eras of globalization and the one we are in now, what is new is the degree and intensity with which the world is becoming interdependent and is being tied together. What is also new is the sheer volume of people and countries that are able to interact with each other because of a globalized economy and the reach of information technology.
Pre-1914 era of globalization
The pre-1914 era of globalization was intense but developing countries in that era were not part of it. A simple statistic can prove it. Daily foreign exchange trading in 1900 was measured in the millions of dollars. In 1992, it was $820 billion a day and by 1998 it as $1.5 trillion a day.
But this era is not just different with respect to trading. There is a marked change from the preceeding eras, both technologically and politically. Information technology has brought the world even closer. And it is affecting not just nations but also individuals leading to a more intertwined global existence.
This era of globalization is witnessing both clashes of civilizations and the homogenization of civilizations, environmental disasters and great environmental triumphs, the triumph of free market liberalization and a backlash against it. Free market is the driving force behind globalization. Free market has its own set of rules – rules that revolve around opening, deregulating and privatizing the global markets. The expansion of advanced technology has led to the creation of a knowledge pool and resource base that connects the globe. It has also leveled the playing field as never before.
If one looks at globalization from a historical perspective, it is clear that the exchange of men, material and ideas has been happening since the beginning of advanced human civilization.
The ancient world - be it Persian, Egyptian, Indian, Mesopotamian, Chinese, the Romans and the Greeks to name just a few had a vibrant trade and movement of people among each other. Over time this led to the second round which was the European dominance, industrial revolution and imperialism but the same global exchanges were at work be it the mass movement of people, capital, raw material, ideas, know-hows between the European leaders and their colonies. Whether it was the militarization of the sea in the 16th century or the early modern world economy from the 17th to the 19th century or the formation of national economies till the end of the second world war, the varied forces of globalization have been at work. The end of the cold war was another major turning point for the world economies and policies.
Pro-globalization forces maintain that the poorer nations that have opened their borders and lowered their tariff barriers have had a marked increase in the employment statistics in their countries which has led to an increase in the national per capita income. Their point is that the lower wages in developing countries is but a reflection of the lower levels of education and productivity that exists there.
They believe that free trade is the key to eradicate world wide poverty, create opportunities for an equitable distribution of resources and wealth and ensure effective development in all spheres be it economic, trade, labour and environment. They advocate the complete elimination of all trade barriers and minimum government intervention in the economy. They also support the implementation of intellectual property rights and a deregulated labour market.
The anti-globalization platform maintains that globalization is but a tool for multinationals and corporates to push their own agendas and greed onto developing nations. The critics of globalization also maintain that rising inequality between nations and individuals is unavoidable because of the existing market forces. They say that large corporations invest in the poorer countries to enhance their profits by using the low cost labour available in these countries and to have an access to their natural resources.
They also stress on the fact that free market does not address the issue of an equitable distribution of wealth and it just assumes that there will be a trickle down effect to the poor.
A strong cross-cultural intermingling is another lasting impact of globalization. To merely put it down as cultural exchange would be a gross understatement. Technology has now created the possibility of a global culture. The Internet, satellite and cable television are sweeping away cultural boundaries, in many ways homogenizing the world and influencing local and traditional culture and lifestyle. This dissemination of values, culture and norms result in an exchange of ideas and commodities across borders. From greater knowledge and awareness of each other comes a better understanding which leads to a more porous border with respect to trade and exchange.
Globalization is just not dominated by economic forces but also through communication. It affects the state, it affects nations, and it affects people’s personal lives. People’s identities, emotions, relationships everything is being reworked by globalization. The lifestyle of people in one part of the world becomes aspirational to people in some other part of the globe.
There exists a strong fear in many parts of the world that local cultures would get completely inundated by symbols of a homogenized, globalized power. A very simple example is the prevelant concerns that local street food is getting swept away by the homogenized fast food multinational entity. There is also the thought that globalization will bring about an end of the nation-state and that a part of its wide spread implication will reflect on the sovereignty and autonomy of modern nations. For in an integrated economy, the countries having the epicenter of control and power invariably start dictating terms to the less powerful nations.
But what it boils down to is that though globalization can produce a strong sense of alienation in many people and nations, it can also trickle down to the local level and give people more power, newer opportunities and better resources to improve lives. Economic and technological forces resulting in development in one part of the world can and does affect an individual on the other part of the world.
Today’s current phase of globalization is about the transformation of modern societies in the areas of politics, economics, communication, culture and migration, environmental issues, law and military affairs. The world is rapidly changing on every sphere and these changes will have lasting effects that are both positive and negative.