points covered: - what is “globalization”? - end of the nation-state? - race to the bottom
TRANSCRIPT
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Points covered:- What is “globalization”?- End of the nation-state?- Race to the bottom
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What is it and is there reason for scepticism?
Hirst, P., Thompson, G. and Bromley, S. (2009). Globalization in Question, 3rd edition (Cambridge: Polity Press).
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1948-2005: Value of exported goods increased from US$58bn. to $10159bn.
Value of imported goods increased from $66bn. to $10511bn.
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Between 1948 and 2005 some regions’ share of world trade declined:
Africa’s (excl. S. Africa) share decreased from 7.3% to 2.9% (exports) and 7.6% to 2.4% (imports).
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Large industrial countries (US, UK, Germany, France, Japan) are only just catching up with their ratio from 1913.
There is nothing unprecedented about the current trade : GDP ratio (cf.
Mosley, p. 109).
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One indication of globalization is increased mobility across boarders:
1)Foreign direct investment (FDI)
2)Finance 3)Goods (trade)
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What is not mobile?People, especially those
with “low skills”: there is far less mobility of people today than in the late 19th and early 20th centuries.
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Developed countries accounted for 84% of world FDI outflow (2006).
Where is it going (inflows)?
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Multinational companies (MNCs) are the main source of FDI to developing countries.
What is the impact on host countries in the developing world?
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MNCs can have a positive effect on host developing countries:
1)Technology transfer2)Skill enhancement3)Increased exports4)Employment
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Employment effects of MNCs:a)Job creationb)Higher wages c)Better working conditionsd)More benefitsAre MNCs obliged to help developing countries more than they currently do?
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Does globalization mean that economic conditions in poorer countries are improving?
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Is the nation-state powerless against the power of international capital?
Does globalization intensify competition amongst nation-states?
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Three ingredients to competition:1)Who (or what) is competing with
each other (or: who are the competitors)?
2)What are the competitors competing for?
3)How are they competing with each other?
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Ingredients of the RTB (Mosley, pp. 110-12):
1)Who are the competitors?‘Jurisdictions’, e.g. nation-states, regions of a country, supranational organizations like the EU.
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2) What are they competing for?Mobile resources, particularly
foreign investment (‘capital’).
3) How are they competing?By creating policies favourable to
international capital in order to attract capital.
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Effects of the RTB:c) Policy convergence across
jurisdictions.d) Policy reaches lowest
common denominator (the ‘bottom’).
e) Undermining democracy.
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Mosley (pp. 112-14):Little evidence of a systematic RTB; some evidence that certain countries and sectors are affected. Hence no imminent “end” of the nation-state.
Why?
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François Hollande announced a new “rich tax” (highest tax bracket of 75%) in France (2012).
Actor Gérard Depardieu, along with other French high earners declared that he would leave the country.