Chapter 1

Globalization

PPTs Available to You

My Web Page:

http://instruction2.mtsac.edu/rjagodka/

• Click on the “Courses” tab

“Lecture Slides” – in PDF for easy viewing …

How Much Do We Know?

How Much Do We Know?

How Much Do We Know?

�How much do we know about the world?

How much do you know about geography?

We have much to learn . . .

So, let’s get started!

7 billion people FILM

What Is Globalization?

�The world is moving away from self-contained national economies toward an interdependent, integrated global economic system

Globalization has two facets: 1) Globalization of markets

2) Globalization of production

What Is The Globalization of Markets?

� Globalization of markets refers to the merging of

historically distinct and separate national markets

into one huge global marketplace

� In many industries, it is no longer

meaningful to talk about the

“German market” or the

“American market”

Characteristics:� Falling trade barriers

� Converging consumer tastes

� Same basic products offered worldwide

The Globalization Of Markets

� Find a partner or two - Introductions

� What was your most recent trip/vacation abroad? (even if it was quite a while ago …)

� Did you buy anything unique while there?

� Were products/services similar to what can

be found in the US?

� Share ideas - debrief

Spend some time at the museum Relax at the beach

Global Socializing Trends

Go to a game

How much time do you

spend texting?

Are you addicted to

smart phones and

texting?

Texting in Class

Technology in the classroom . . . Appropriateness

If you have an emergency and

need to receive a text or call –

this is fine

If you habitually text in class –

this is NOT OK (even if you

are addicted to texting)

Laptop use OK - if it does not

cause any distractions – no technology allowed during exam review

The Globalization Of Markets

� Lets test your knowledge

World Eating Quiz

� 200 counties over 200 years FILMhttp://devdata.worldbank.org/DataVisualizer/

What is Globalized Production?

�Globalization of production refers to the sourcing of goods and services from locations around the globe

�Take advantage of Differences in the cost and quality of factors of production

�Land, labor, and capital

Improve

Quality

Lower

Costs

Selection of Country for Semester

We will each get one country to study this semester.

Selection Process based on draw of paper slips

You will get 5 minutes to walk around the room and trade if you like.

The Emergence Of Global Institutions

Globalization requires basic ground rules

Institutions are needed:

�manage, regulate, and police the global marketplace

� promote multinational treaties (to govern)

Global Institutions

WTO

IMF

World Bank

UN

Polices world trade system

• Ensure nations follow rules

• In 2007, 150 nations

(97% of world trade) were

WTO members

• Promotes lower barriers to

trade and investment

G20

Declining Trade & Investment Barriers

Average Tariff Rates on Manufactured Products as Percent of Value

Global Institutions

Monetary cooperation

• Polices the international

monetary system

• Lender of last resort for countries in crisis

• Provides temporary

financial assistance to

countries to help ease

balance of payments

adjustment

WTO

IMF

World Bank

UN

G20

Global Institutions

Economic development

• Financial and technical

assistance to developing

countries

• Is two unique development

institutions (owned by 185

member countries)

• International Bank for

Reconstruction and

Development (IBRD) and

• International Development

Association (IDA).

WTO

IMF

World Bank

UN

G20

Global Institutions

• Peace and security

• Develop friendly relations

among nations

• Cooperate in solving

international problems

• Promote respect for human

rights

• Harmonize the actions of

nations

WTO

IMF

World Bank

UN

G20

Global Institutions

• Largest 19 economies• Finance ministers• Central bank governors• EU & EU Central Bank

• Originally coordinated policy response to financial crisis in developing countries

• Forum through which major nations tried to launch a coordinated policy response to the 2008-2009 global financial crisis

WTO

IMF

World Bank

UN

G20

Globalization

Globalization impacts countries differently

World Bank Economist Branko Milanovic

Elephant in the Room - video

How does this make you feel?

Globalization

Globalization video (15 minutes)

Globalization

While watching, write answers to these questions:

1. What are the 4 main arguments against globalization?

2. Do you agree or disagree with each?

Protectionism

Protectionism (2 min)

While watching, consider this question:

Do you feel that protectionism is good or bad? Why?