Evolution of the International Economic System - 3 | PSIR Optional for UPSC (Notes) PDF Download

Globalization in International Relations

• The main goal of this unit is to grasp the concept of globalization, both in terms of its content and significance, to effectively apply or appreciate it in the study of International Relations (IR).
• Globalization is frequently used in contemporary discussions on IR, and some argue that studying modern international relations without considering globalization is inadequate.
• The term "globalization" was first seen in French literature on IR in the 1950s, where it was called "mondialisation." However, its usage in IR literature has surged in recent years, especially due to advancements in information and communication technology.
• Despite its widespread use, there is no consensus on what globalization truly represents, making it a popular yet contested term in current discourse.

Towards Definition of Globalisation

1. Globalisation is a complex and multi-dimensional phenomenon that affects various aspects of human life, including social, economic, and political spheres.
2. Some scholars view globalisation as a set of interconnected phenomena, where no single aspect is more important than the others. Key factors distinguishing today's globalisation process include rapid communications, market liberalisation, and global integration of goods and services production.
3. Others emphasize the role of global communication networks as the foundation of globalisation, arguing that advancements in communication technology have enabled the seamless transcendence of ideas, information, and cultural values beyond national boundaries. This, in turn, has triggered new political and social dynamics worldwide.
4. Some writers focus solely on the economic aspect of globalisation, defining it as the increasing interconnections of markets across different countries due to trade liberalisation, capital investment, and the diffusion of services. They view globalisation as synonymous with free-market capitalism.
5. Contrarily, some argue that globalisation is two-dimensional: it promotes economic growth, technology spread, and improved living standards in both developed and developing countries, while also undermining the sovereign authority of nation-states, eroding local cultures and traditions, and threatening economic and social stability.

Core Characteristics of Globalisation 

• Descriptive Nature: Globalization is best understood as a descriptive term, reflecting a set of pronounced social, political, economic, and technological forces, rather than prescribing a desirable or undesirable outcome.
• Historical Continuity: While the term "globalization" may be relatively new, the phenomena it describes are not. Similar phenomena have been present in the past.
• Beyond Nation-States: The institutions arising from globalization extend beyond the power of nation-states. In contemporary international affairs, nation-states are not the sole actors; non-governmental organizations (NGOs), environmental movements, transnational corporations, ethnic groups, and regional organizations also play significant roles.
• Porous Boundaries: The role of new actors in a globalizing world spans a wide range due to the increasing number of economic, political, and communication networks. These networks have made nation-state boundaries more permeable to the movement of people, goods, services, ideas, and information.
• Expansive and Intensive Relations: Globalization has made international relations both more expansive and intensive. There are more actors and networks influencing each other, and the impact of each actor on another is qualitatively greater than in the past. Global media networks, products of transnational corporations, and large-scale migration have significantly influenced the social and cultural fabrics of people worldwide.

Percept Ions of the Protagonists 

Differences in Perceptions of Globalization

• Debate on benefits and drawbacks of globalization.
• Impact on future international relations.

Globalization and National vs. International Boundaries

• Globalization blurs the lines between national and international spheres.
• Some believe this promotes world peace and economic well-being.
• Others see it as a threat to democracy and human identity.

Emerging Global Community

• Proponents envision a "cosmopolitan democratic community" at the global level.
• Some advocate for globalization without reservation, blaming problems on insufficient global integration.
• Critics highlight the failures of nation-states in ensuring peace and human rights.

Global Government vs. National Sovereignty

• Support for a "world government" to address global issues like human rights and poverty.
• Global institutions seen as more effective than nation-states in tackling resource management and environmental degradation.

Qualified Support for Globalization

• Some support globalization but differentiate between its positive and negative aspects.
• Industry may favor market opening but resist international environmental standards.
• Labor may advocate for international human rights conventions while criticizing poor labor conditions in the global market.

Nation-State and Globalization

• Advocates stress the importance of the nation-state in maintaining national interests.
• Nation-states should collaborate on global issues.
• Belief in the emergence of a global civil society comprising nation-states and NGOs, guided by international norms and treaties.

Perceptions of the Critics 

Proponents of Globalization

• Advocates, even with some reservations, argue that globalization has brought new benefits and opportunities to national communities.
• They believe it has opened up markets and applied necessary pressure on nation-states to enhance human security and well-being.

Critics of Globalization

• Critics view globalization as a set of dangerous and potentially uncontrollable forces.
• They argue that it disempowers communities by undermining the nation-state's power and authority to manage its economic and political systems and protect its national identity.

Major Concerns Raised by Critics

• Compromise of National Economic Interest: Globalization threatens the economic interests of nations.
• Curtailment of Nation-State Sovereignty: It limits the sovereignty of nation-states.
• Erosion of National Identity: Globalization undermines and erodes national identities.

Compromise of National Economic Interest 

Impact of Globalization on National Economies

• Globalization, driven by advancements in information and communication technology, has enabled capital to move freely across national borders.
• Transnational corporations (TNCs) now have the power to establish operations with multinational bases and transfer activities and resources across countries on a large scale.
• This economic globalization has increased interdependence among domestic economies and heightened their reliance on investments from TNCs.
• Economic interdependence involves raising capital in one or more countries to support production in others and spreading the production of commodities across multiple countries.
• The ease of capital movement across borders has both positive and negative implications. While it facilitates investment, it also poses the risk of capital withdrawal from less lucrative economies, leading to revenue loss for national governments.
• To attract capital and investment, national governments often lower tariffs and implement favorable economic regimes, resulting in a "race to the bottom."
• This dynamic contributes to increasing wealth inequality both between and within national communities.
• As national revenue declines, the ability of nation-states to represent and protect the economic interests of their communities diminishes.
• Additionally, reduced revenue limits the capacity of nation-states to provide essential services such as education, skills development, and healthcare, further impacting human resource development efforts.

Curtailment of National Sovereignty 

Concerns about Globalization and Nation-State Sovereignty:

• Globalization raises concerns about its impact on the sovereignty of nation-states. National governments face increasing pressure to implement international treaties and conventions that satisfy the international community.
• These treaties impose demands and standards on national governments, subjecting them to scrutiny by international institutions.
• Historically, treaties were seen as tools for nation-states to protect their sovereignty and ensure mutual benefit. They focused on diplomatic relations and peace between states.
• However, recent international treaties have expanded to regulate domestic political, economic, and environmental matters, blurring the lines between domestic and international affairs.
• This shift has led to claims of a democratic deficit, where international treaties disrupt the accountability between elected governments and their citizens.
• Organizations like the World Trade Organization (WTO) and the International Monetary Fund (IMF), to which national governments are accountable, are not always democratic institutions, raising concerns about the legitimacy of these international obligations.

Erosion of National Identity 

Globalization and National Identity

• Globalization is said to create pressures on national identity through increased population mobility and advancements in global communication networks.
• The gap between high living standards in the 'North' (industrialized and technologically advanced countries) and low standards in the 'South' (less developed countries) stimulates population movement.
• Countries in the 'North' face challenges to their national identity as they experience a resurgence of xenophobia and racist violence due to the influx of people with diverse cultural beliefs and practices.
• This influx forces these countries, which once had clear cultural standards and practices, to accommodate a growing number of individuals with different cultural backgrounds.
• The emergence of wider civil societies in these nations is disrupted as individuals form associations that exclude those who do not share common cultural identities.
• The electronic revolution in communication technology contributes to the erosion of cultural identity through a process called homogenization.
• Homogenization impacts both the 'North' and the 'South,' leading to concerns from critics on both sides regarding the effects of globalization.

International Relations theory and Globalisation 

• Globalisation is a complex and widely debated topic in international relations (IR).
• Scholars have different views on its definitions, impacts, and relationship with the nation-state.
• It is crucial to connect globalisation with IR theory.
• This discussion explores the main points of contention regarding globalisation.
• Globalisation is contested in IR, focusing on its definitions and significance.
• Debates include its historical significance, benefits, drawbacks, and its impact on the nation-state.
• Establishing connections between globalisation and international relations (IR) theory is essential.
• One key debate is whether globalisation is an idea or a cognitive material factor.
• Some argue it is triggered by material forces like technology, while others emphasize human understanding.
• The Constructivist School of IR suggests considering both aspects in analyzing globalisation.
• Another important concern is the relationship between the economic and political spheres.
• Scholars debate whether economic globalisation leads to political transformation or vice versa.
• Some argue that politics acts as a check on economic globalisation.
• These differing perspectives challenge the development of a unified approach to studying globalisation and IR theory.
• There are significant disagreements among proponents of globalisation regarding its relevance to key developments in international relations.
• Conflicting views exist on the relationship between globalisation and the end of the Cold War.
• Some argue that globalisation resulted from the end of the Cold War, while others believe it caused it.
• To resolve this dilemma, some theorists suggest that globalisation is both a cause and an effect of the Cold War.
• It is a cause as it has diminished the role of the nation-state in the post-Cold War international order.
• It is an effect because the end of the Cold War facilitated rapid globalisation.
• This view highlights both continuity and change in the post-Cold War era.

Towards Formulation of IR theory on "Globalised'' State

Impact of Globalization on Nation-State Sovereignty:

• Globalization, driven by information technology, challenges the nation-state's ability to manage its economy independently.
• The Structuralist, Marxist, and Dependencia Schools of International Relations (IR) theory argue that developing countries have always struggled with state sovereignty due to their position in the global capitalist system.

Differentiating Globalization from Interdependence:

• Globalization differs from interdependence by not only impacting the autonomy aspect of sovereignty but also challenging its core element: formal authority.
• Globalization represents a fundamental shift in sovereignty, affecting both domestic and international aspects and realigning authority and autonomy.

Challenges to Sovereignty:

• Globalization has adversely impacted the territoriality, identity, and authority elements of sovereignty.
• Decisions and outcomes are increasingly disconnected from the choices of sovereign states and their territorial confines, leading to porous national boundaries.
• The rise of civil society has diluted the absolute authority once held by the state.

Emergence of New Authority Networks:

• Globalization has led to the creation of new networks of authority, such as international regimes addressing global security issues like human rights and environmental protection.
• These international regimes represent an evolution of sovereignty rather than a decline, indicating a readjustment of its internal and external dimensions.

Transformation of Sovereignty:

• Sovereignty is undergoing transformation, with both control/capacity and authority aspects becoming variables in the context of globalization.
• New identities and less territorialized functions are emerging, with the nation-state's link between territoriality and primary functions becoming more tenuous.
• The state’s legitimacy is increasingly based on its ability to ensure political rights for its citizens rather than its relationship with a specific territory.

Adaptation of the Nation-State:

• The nation-state is adapting by discarding traditional capacities while acquiring new ones.
• It delegates certain functions to international and transnational bodies while retaining authority to monitor their effectiveness.
• These shifts in delegation and arrogation of state capacities are transforming the content of sovereignty in the current phase of globalization.

Sovereignty in the Post-Cold War Era:

• The post-Cold War era sees the nation-state’s exercise of sovereignty legitimized more by its capacity to ensure political rights than by territorial control.
• The state is remaking itself in response to conflicts in domestic and international spheres, reflecting a dynamic and evolving concept of sovereignty.

Framework for a New Theory of IR:

• A framework that integrates globalization into the analysis of IR can help develop a new theory that reflects the changing nature of sovereignty and state authority.

Summary 

Globalisation in International Relations

• Globalisation is a key concept in contemporary discussions in International Relations (IR).
• Definitions of globalisation vary widely, ranging from its impact on social, economic, and political spheres to a focus on its economic aspects.
• These differing definitions have sparked debates about the benefits and drawbacks of globalisation.
• Some argue that globalisation blurs the lines between international and national spheres, which is central to IR.
• Proponents of globalisation believe it fosters world peace, human security, and economic well-being.
• Critics contend that globalisation threatens democracy, human freedom, and identity.
• There are those who accept certain aspects of globalisation while rejecting others, emphasizing the role of the nation-state in safeguarding national interests.
• This perspective advocates for cooperation among nation-states to address global issues and envisions the rise of a global civil society comprising states and NGOs, governed by international norms and treaties.
• Despite the debates surrounding globalisation, it is essential to establish a clear connection between globalisation and IR theory.
• This requires redefining state sovereignty and developing a new analytical framework for studying globalisation in the context of international relations.