Chapter 2 – Globalization, International Institutions, and Global Governance (Flashcards)

Globalization and the Global Economy

Globalization refers to the expansion of national economies into the global market, driven by technology and institutions that enable faster flow of goods and capital. The Global Economy is the interconnected system of extraction, production, distribution, consumption, and disposal of goods and services across borders. International Financial Institutions (IFIs) provide loans, aid, and technical assistance to governments and private sectors. The Global Civil Society comprises non-governmental actors mobilizing around common causes. A Global Corporation operates in multiple countries. The World System emphasizes that social and economic change is shaped by interactions with global external institutions. Economic Integration is the process of linking national economies with regional or global markets.

Key Actors Facilitating Economic Globalization

Non-State Actors include International Economic Organizations (IMF, World Bank, OECD) and regional bodies (ASEAN, NAFTA). Multinational Companies drive investments and global production networks. Central Banks influence monetary policy and financial stability. Global Civil Society and Transnational Advocacy Networks promote causes and policy changes. Transnational Corporations operate across borders, while Intergovernmental Forums (G8, G20) discuss major issues and influence national policies.

Modern World System

The Modern World System framework recognizes that nations’ development is shaped by their position in the global system (core, semi-periphery, periphery) and their interactions with external institutions.

Global Interstate System

Global Interstate System is an institutional governance arrangement addressing regional or global issues that go beyond the scope and capacity of a single nation-state.

Internationalism vs Globalism

Internationalism emphasizes diversity and cooperation among states while respecting differences; Globalism focuses more on economic exchanges and interconnectedness among countries and societies.

Effects of Globalization on Governments

Globalization reduces some aspects of national sovereignty as states participate in global agreements; it encourages regional cooperation (e.g., ASEAN, EU, UN) and pressures governments to align policies with international standards in trade, human rights, and the environment.

Institutions that Govern Globalization

Key institutions regulate and guide globalization: IMF monitors the stability of the international monetary system, lends to countries, and provides policy advice; WTO regulates international trade and provides a forum for negotiations; WHO conducts global health research and surveillance; OECD compares policy experiences to identify best practices; ILO sets labor standards and social protection; FAO fights hunger and strengthens food security; UNESCO promotes peace through education, science, and culture; ICAO, IMO, ITU, and WIPO regulate air transport, shipping/pollution, ICT standards, and intellectual property rights.

Market Integration and IFIs

Market Integration is the process by which economies become more interdependent in terms of commodity flows, externalities, and spillover effects. IFIs provide funding and technical advice to promote development, recovery, and economic reforms; IMF ensures monetary stability and balance-of-payments support; World Bank funds long-term development; OECD promotes growth, trade, and social well-being.

Corporations in Globalization

Private institutions that produce and distribute across markets; Multinational Corporations (MNCs) operate in multiple countries; Transnational Corporations (TNCs) manage cross-border production networks; They drive trade and investment, create jobs, transfer technology, and shape local economies and policies.

History of the Global Economy

Pre-Modern: trade routes like the Silk Road and Spice Trade; Colonial Economy: mercantilism and resource extraction; Industrial Revolution: mechanization and mass production; 20th Century: two World Wars and Bretton Woods Institutions (IMF & World Bank, 1944) to rebuild and stabilize; Late 20th Century–present: globalization, digital economy, and financial integration; dominance of MNCs and IFIs.

Contemporary Global Governance and Rise of Non-State Actors

Global governance involves collective efforts to address problems beyond states’ capacities; globalization challenges the sovereignty of the nation-state; Non-State Actors such as NGOs, Greenpeace, Amnesty International, and the World Economic Forum influence policy and mobilize resources.

The United Nations (UN) Structure

Established in 1945 to promote peace, security, cooperation, and development. Five main branches: 1) General Assembly (main decision-making and representation); 2) Security Council (authorizes deployment of UN forces, mandates cease-fires, and enforces penalties; 5 permanent members and 10 rotating); 3) International Court of Justice (settles disputes and provides advisory opinions); 4) Economic and Social Council (ECOSOC) (economic and social development); 5) Secretariat (headed by the Secretary-General) provides studies and data for UN organs.