Global-Economic

At the end of this lesson, you should be able to:
- Define economic globalization.
- Identify the actors that facilitate economic globalization.
- Narrate a short history of global market integration in the twentieth century.
- Articulate your stance on global economic integration.

Types of Economies in Globalization:
- Protectionism:
  - A policy of systematic government intervention in foreign trade to encourage domestic production.
  - Involves quotas and tariffs to protect local industries.
  - Example: A $1.00 pen incurs a $5 tariff in another country, costing $6.
  - Historically prominent during the mercantilist era (16th-17th century) and reached its peak during the Great Depression of 1929.
  - Despite a trend towards trade liberalization, protectionism still exists, notably among countries like China and the U.S.
- Trade Liberalization:
  - Shift post-World War II to free trade policies, facilitated by technological advancements in transportation and communication.
  - Example: Mobile phones are considered transformative for the developing world, enhancing access to banking, education, and market pricing.
  - The leapfrogging concept allows countries to adopt superior technologies without developing older systems.

Sustainability Concerns:
- The sustainability of earth's resources for future generations is critical, leading to the concept of sustainable development.
- Sustainable development aims to balance economic growth with ecological preservation, addressing economic, political, and technological dimensions.

Economic development, accelerated by the Industrial Revolution, has led to:
- Increased carbon emissions damaging the environment.
- Coral reef destruction and marine biodiversity loss due to waste pollution.
Challenges include deforestation, pollution, and climate change affecting sustainability under increased global demand for consumer goods.

By 2050, global food demand is expected to increase by 60%, necessitating food security to feed 9 billion people.
Sustainability encompasses not just food delivery but also addresses population growth, climate change, water scarcity, and agricultural practices.
Example of India:
- Accounts for 18% of the economy and 47% of the workforce in agriculture but faces severe undernourishment issues despite being a major producer of fruits and vegetables.

Globalization drives companies to seek low-cost production, leading to:
- Job relocation to low-wage countries.
- Benefits for corporations and consumers but negative impacts on high-wage workers in developed nations.
- Emerging markets may offer above-average wages, making them desirable, despite possible hazardous conditions.
Types of Inequality:
- Wealth Inequality: Distribution of national assets and resources.
- Income Inequality: Flow of new earnings measured through GDP.

Economists argue globalization benefits the poorest slightly, while the wealthy gain disproportionately:
- Past economic revolutions established significant inequality, but economic globalization continues to widen the gap.
- Example: Richard Freeman's observation that globalization improves living standards for billions while enriching the few.

The global financial crisis has lasting impacts and isolationist policies are ineffective in today's integrated world.
Countries benefit from exports and free trade:
- Advanced nations dominated in the past, but developing countries now capture significant market shares in exports.
Economic globalization has contributed to unprecedented growth, but benefits are unevenly distributed.
- Countries often face trade imbalances, with poorer nations disadvantaged.

Economic integration remains a vital aspect of globalization, influencing global culture and politics.
Policymakers must pursue avenues for fairer trade while mitigating negative effects of globalization, ensuring benefits are shared equitably.