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Economic Geography 5

Economic Geography 5. Globalization as a consequence of technological change. What is global?. Different meanings of one word All-encompassing (quantitative) General (not specific) Worldwide (spatial). Hypothesis (spatial aspect).

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Economic Geography 5

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  1. Economic Geography 5 Globalization as a consequence of technological change

  2. What is global? • Different meanings of one word • All-encompassing (quantitative) • General (not specific) • Worldwide (spatial)

  3. Hypothesis (spatial aspect) • Global is related to a specific situation, i.e. the perception of the world • Global is nothing new but has been with mankind since its existence

  4. Supports • The Chinese civilization practised global trade within the world the Chinese traders and politicians knew • The Roman Empire was a global empire in the sense that it encompassed almost the entire known world

  5. Precise Terminology (U. Beck) • Globalism • Globality • Globalization

  6. Globalism • ‘… the view that the world market eliminates or supplants political action – that is, the ideology of rule by the world market, the ideology of neoliberalism.’ • This means that economic thinking (profit maximization) is more important than political thinking (for the common good)

  7. Globality • ‘… that we have been living for a long time in a world society, in the sense that the notion of closed spaces has become illusory. No country or group can shut itself off from others.’ • Beck refers to the expansion of knowledge about the global interrelationships, concerning the societies and the environment

  8. Globalization • ‘… the processes through which sovereign national states are criss-crossed and undermined by transnational actors with varying prospects of power, orientations, identities and networks.’ • It is therefore not a state of things but a process that is – according to Beck - irreversible

  9. Irreversibility 1 • Geographical extension of global trade, global financial network, power of TNCs • Information and technological revolution (a lasting process) • Universal claim for Human Rights (Democracy) • Flows of images of a global cultural industry • World politics and number of transnational actors (TNCs, NGOs, International organizations)

  10. Irreversibility 2 • Poverty as a global phenomenon • Global degradation and destruction of the environment • Transcultural conflicts • + geopolitical claims, hegemony and military technology U. Beck

  11. Changing globality systems Colonial system: motherland rules colonies • strictly bilateral relations • Commodity exchange dictated by motherland World trade (intermediary stage) • Commodity exchange on the free market basis Transnational Companies (TNCs) • Headquarters in the North, dependent plants in the South • Global playground of the TNCs according to their own ideas

  12. Motherland Colonies Colonial system

  13. A B Centre Satellite Sub-satellite New globality system

  14. TNC Individualistic (the firm) Materialistic Profit- and power-oriented Shareholders Centrifugal Flexible (change) State Collective (the society) Idealistic (solidarity) Protection Electors Centripetal Steady (continuity) TNCs vs. the State

  15. Characteristics • International division of labour • Flexibility in location • Capital flows around the globe (foreign direct investment) • Diffusion of Northern ways of thinking, lifestyles, culture

  16. TNCs • 1998: c. 44,000 • 2002: c. 65,000 • In 2000, in the 100 Largest TNCs worldwide, 5 (five) were based in the South: South Korea, Hong Kong, China, Mexico and Venezuela

  17. Largest TNCs 2001 (revenue) • Walmart (US), 220 billion US$ • Exxon (US), 192 • General Motors (US), 178 • BP (UK), 174 • Ford Motor (US), 162 • Enron (US), 139 • DaimlerChrysler (D), 137 • Royal Dutch/Shell (UK/NL), 135

  18. Foreign direct investment

  19. Conditions for globality • Information and communication • Transportation • Consciousness of international community • International institutions (UN, Bretton Woods organizations: IMF, WB) • International law

  20. Economic expression of globality • Flexibility in the productive sector: no permanent production localizations but locational decisions as to the cost factor • Regulation in the firm can be separated from production • Variability of consumer demands (habit of great choice of goods at low prices)

  21. Anti-globalization protests • A globally active movement • Protests are organized worldwide via e-mail and internet • Can a globalized protest-movement be against the global scale? Or what is the protest against? • Anti-liberalism, i.e. against the primacy of the free market and against the growing disparities

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