Globalization Theories - Economics, Class 12 Video Lecture - Commerce

Voice over: Alright, let's take
a look at globalization and
some of the theories and
different perspectives about it.
In general globalization is the sharing of
culture, and money, and
products, between countries
that is happening because
of international trade,
and advances in transportation
and communication.
You might think that globalization
is a recent development,
but really international
trade has influenced
changes across borders for centuries.
Silk and spice trade
routes through East Asia
that began as early as
the 1st century BCE,
introduced different cultures and linked
the economies of different nations.
As did the English and Dutch shipping
empires in the 16th Century.
Globalization is also a social
process where people become
more and more aware of
other cultures and peoples,
across geographical
political and social borders.
The economic interdependence
of different countries,
as well as advancements in
communication technology,
and the progress of technology in general,
have all contributed to globalization.
There are many theories of globalization.
Let's look at World-systems theory first.
World-systems theory focuses on
the importance of the world as a unit,
rather than looking at
individual countries.
It divides the world in to three regions:
core countries, periphery countries,
and semi-periphery countries.
Core countries include areas like
Western Europe and the United States.
These countries have a
strong central government
with enough tax to support it.
They are economically
diversified, industrialized,
and relatively independent
of outside control.
They have strong middle
and working classes,
and focus on higher scope production
of material goods rather
than raw materials.
Periphery countries are those
in Latin America and Africa,
and tend to have a
relatively weak government.
They tend to depend on only
one type of economic activity
like extracting raw materials.
There's a high percentage of
poor and uneducated people,
as well as a small upper class
which controls most of the economy.
And this creates a huge
inequality in the population.
These countries are greatly influenced by
core countries and
transnational corporations.
Which can harm the future
economic potentials
of the periphery countries.
Semi-periphery countries
like India and Brazil
make up the middle ground
between Core and Periphery.
They are often not dominant
in international trade but
they have a relatively
diversified and developed economy.
These semi-periphery
countries can come either from
Periphery countries moving
up toward the industrialized
Core countries, or from
Core countries declining
toward Periphery status.
The World-systems Theory is a fluid model,
but it is criticized
for being too focused on
the economy and the Core countries,
and forgetting about the culture or even
the class struggles of
individual countries.
Then we have modernization
theory which proposes that
all countries follow a similar path
of development from a
traditional to a modern society.
It assumes that with some
help traditional countries
can develop into modern
countries in the same way
that today's modern countries
developed in the first place.
It looks at the internal social dynamics
as the country adapts to new technologies,
and the political and
social changes that occur.
Dependency theory was a reaction
to modernization theory,
and uses the idea of Core
and Periphery countries
from the World-systems theory to look at
the inequalities between countries.
Basically it is the idea that Periphery
or third world countries are
poor and export resources to
the wealthy core or first world countries.
Not because they are in an
earlier stage of development,
but because they have been integrated into
the World-system as an
undeveloped country.
They have their own
structures and features
not seen in developed countries,
and will not accelerate to
become a developed nation.
They are in an unfavorable
economic position that means
they don't even have the
opportunity to improve and develop.
They'll remain poor and
dependent on wealthier nations.
These are just a few of the
theories of globalization.
There are lots more that look at: culture,
or social networking, economy,
politics, or even goods.
The world is now a busy and bustling place
where events and things can
have an effect around the globe.
There are different ways of
looking at globalization too.
The hyper globalist
perspective sees globalization
as a legitimate process ,a
new age in human history.
Countries economies become interdependent
as the nations states themselves
become significantly less important.
The many individual countries
become one global society,
though theorist don't agree
whether this is good or bad.
The skeptical perspective is
critical of globalization,
and considers today's
international processes as becoming
regionalized rather than globalized.
Countries borders are not
becoming less important.
The third world countries
aren't being integrated
into the global economy with the same
benefits as first world countries.
Skeptics don't believe
that the current economy
is leading towards global capitalism.
transnational Corporations
are still tied to their
home country and national
borders are as important as ever.
Then you have the
transformationalist perspective which
doesn't have either a specific
cause or a specific outcome.
They believe that National
Governments are changing,
perhaps becoming less important,
but it is difficult to
describe the change so simply.
As to the strong stance
skeptics take on the
marginalization of third world countries,
transformationalists again just see
that the world order is changing.
Into what specific patterns
they are uncertain,
just that a new world
order design is developing.
They state that there
are many factors that
influence the change
of the world patterns,
but that the outcomes of these
changes is just not known.
Globalization has caused
many changes in society.
It has allowed for international
terrorism and civil unrest
as different nations are
inundated by foreign cultures.
It has also created a world economy
where different countries
are interdependent
on each other promoting
a global community.