CSULACSULA

BUS 515BUS 515

MEASURINGMEASURING

WALTER ALMORAWALTER ALMORA

SAMSON TESFASION SAMSON TESFASION

GLOBALIZATIONGLOBALIZATION

MAMAYY

20020055

WHAT’S GLOBALIZATION?WHAT’S GLOBALIZATION?

Globalization is the increasing Globalization is the increasing interconnectedness interconnectedness

of people and societies of people and societies and the interdependence of economies, and the interdependence of economies,

governments and environments.governments and environments.

WHY MEASURE GLOBALIZATION?WHY MEASURE GLOBALIZATION?

WHY MEASURE GLOBALIZATION?WHY MEASURE GLOBALIZATION?

There appear to be a direct relationship among civil liberties, more political rights, lower levels of corruption and ... the level of globalization.

WHY MEASURE GLOBALIZATION?WHY MEASURE GLOBALIZATION?

Also, it seems to be a relationship between globalization and patterns of inequality of income.

HOW MUCH GLOBALIZATIONHOW MUCH GLOBALIZATIONIS OUT THERE ?IS OUT THERE ?

HOW MUCH GLOBALIZATIONHOW MUCH GLOBALIZATIONIS OUT THERE ?IS OUT THERE ?

“Trade flows are not significantly higher

than they were prior to 1914 if one measures

them against GDP, but loom much larger if they are compared

against industrial production.“

“Symposium on Globalization in Perspective: An Introduction” Dany Rodrik – 1998 – Journal of Economics Perspectives

D. Rodrik, 1998D. Rodrik, 1998

HOW TO MEASURE HOW TO MEASURE GLOBALIZATION?GLOBALIZATION?

There is not a clear-cut method There is not a clear-cut method for measuring the extent of for measuring the extent of globalization.globalization.

Researchers have used a variety Researchers have used a variety of references to provide an idea of references to provide an idea on globalization and their impact.on globalization and their impact.

FOREING POLICYFOREING POLICY MAGAZINE 2005 MAGAZINE 2005

The FOREING POLICY Globalization Index measures 12 variables and group them in 4 categories:

1. Economic Integration2. Personal contacts3. Political engagements4. Technological connectivity

ECONOMIC & FINANCIAL ECONOMIC & FINANCIAL INTEGRATIONINTEGRATION

Economic integration can be measured by the volume of Capital Flow, Trade, or Gross Domestic Product (GDP) between countries.

Financial Integration can be measured by the Amount of Foreign Direct Investment, or, the Ratio of Foreign Capital stock to GDP.

PERSONAL CONTACTSPERSONAL CONTACTS

The amount of international travel and tourism

The amount of international telephone traffic

The amount of Remittances and personal transfers

POLITICAL ENGAGEMENTPOLITICAL ENGAGEMENT

The amount of membership in international organizations

The amount of personal and financial contribution to UN peace keeping missions

The amount of international treaties ratifications

The amount of governmental transfers

TECHNOLOGICAL CONNECTIVITYTECHNOLOGICAL CONNECTIVITY

The amount of internet users

The amount of internet hosts

The amount of secure servers

Latest 2003 Actual ResultsLatest 2003 Actual Results

1. Singapore rank top in political engagement due to 41% increase in financial contribution to UN peace keeping mission

2. Also Singapore rank first place in foreign investment by signing bilateral free trade agreement with United States

2003 Results continued…2003 Results continued…

3. Large nations with large population and domestic market (e.g. US) usually rank low in foreign trade and investment because they are less dependent on them nevertheless, United States jumped from 7th to 4th

became the first large country in top five.

4. United States also rank first in technology connectivity basket due to increased number of internet hosts and number of secure servers

5. Due to SARS epidemic tourism in Asia dropped by almost 50% in 2003

2003 Results continued…2003 Results continued…

Internet UsersInternet UsersAs a Percentage of U.S. PopulationAs a Percentage of U.S. Population

3644

5055

59

0

10

20

30

40

50

60

70

80

90

100

1999 2000 2001 2002 2003