A Report on

The Structures of Globalization

Members:

Dionaldo, Mario Lito

Gantuangco, Dave

Taroc, Moses Angelo

Guarin, Mary Grace

Saturion, Myra

Umpad, Dana Kezziah

Submitted to:

Mr. George Albaracin

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 Table of Contents

Title Page ………………………………………………………………………….....................1

Table of Contents …………………………………………………….……................................2

Global Economy ………………………………………………………………….....................3

Market Integration ………………………………………………………….…….....................4

Global Interstate System………………….…………………………………………................5

Contemporary Global Governance …………………………………………………….............6

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GLOBAL ECONOMY

Global economy is the economy of the humans of the world, considered as the
international exchange of goods and services that is expressed in monetary units of account. It is
also the exchange of goods and services integrated into a huge single global market. It is
virtually a world without borders, inhabited by making individuals and companies who have
joined the geographical world with the intent of conducting research and development and
making sales. International trade permits countries to specialize in the resources they have.
Countries benefit by producing goods and services they can provide cheaply and by buying the
goods and services to other countries t can provide most cheaply. International trade make it
possible for goods to be produced and for more human wants to be satisfied than if every country
tries by itself to produce everything it needs.

United States is one of the world’s leading trading nations. The exports and imports of
the United States thrive so mightily that the profits of many large business. U.S is the leading
country that has the largest economy, followed by china and japan .The economy of Philippines
is the world’s 34th largest economy according to the 2017 estimate of the international monetary
fund’s statistics, it is the 13th largest in Asia and 3rd largest in ASEAN after Indonesia and
Thailand .Philippines is one of the emerging markets and is the 6th richest in Southeast Asia by
GDP per capita values after regional countries of Singapore, Brunei ,Malaysia, Thailand, and
Indonesia .Philippines is primarily considered as the new industrialized country which has an
economy transitioning from one based agriculture to one based more on services and
manufacturing. It is one of the Asia’s fastest growing economics. However, problem remain
mainly having do with alleviating the wide income and growth disparities between the country’s
different region and socioeconomic classes, reducing corruption, and investing in the
manufacture necessary to ensure future growth. Global economy affects everyone in the world. It
creates jobs, and provides people with all the resources they need.

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MARKET INTEGRATION

Globalization mean differently to various people of diverse professions. To an economist,

globalization means the integration of markets. Market integration is the fusing of numerous
markets into one in which historically distinct and separate national markets converging into one
huge global marketplace.

Global market integration means that price differences between countries are eliminated
as all markets become one. When the cost of trading across borders fall, there is more potential
for firms to take advantage of the price difference. Trading costs fall when new forms of
transport are invented, or when existing ones become faster and cheaper.

International trade occurs when a firm exports goods or services to consumers in another
country, while foreign direct investment occurs when a firm invests resources in business
activities outside its home country. Trading to long distances has existed for centuries and these
trades created a demand for new products. The revolution in technology created various means
of transporting goods (ships, trains and trucks), refrigeration and the opening of the Suez Canal
has resulted with unprecedented flows of capital, goods, and labor across borders.

However market integration was not acknowledged well by countries to begin with.
During the 1920s and 1930s, many nations erected barriers to international trade and foreign
direct investment to protect domestic industries from foreign competition. After WWII, advance
Western countries began removing trade and investment barriers. Under GATT (predecessor of
WTO), over 100 nations negotiated further decreases in tariffs and made significant progress on
a number of non-tariff issues. Under the WTO, a mechanism now exists for dispute resolution
and the enforcement of trade laws, and there is a push to cut tariffs on industrial goods, services,
and agricultural products. Lower trade barriers enable companies to view the world as a single
market and establish production activities in optimal locations around the globe.

Managing an international business (any firm that engages in international trade or

investment) differs from managing a domestic business in 4 key ways:

1. Countries’ differences require companies to vary their practices country by country.

2. Managers face a greater and more complex range of problems
3. International companies must work within the limits imposed by the governmental
intervention and the global trading system
4. International transactions require converting funds and being susceptible to exchange rate
changes

(Sources: www.mikebertuben/economic-concepts/market-integration/ and Global Business

Today by Charles W.L. Hill)

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GLOBAL INTERSTATE SYSTEM

The modern world-system is structured politically as an interstate system – a system of

competing and allying states. Political Scientists commonly call this the international system, and
it is the main focus of the field of International Relations. Some of these states are much more
powerful than others, but the main organizational feature of the world political system is that it
is multi-centric. There is, as yet, no world state. Rather there is a system of states. This is a
fundamentally important feature of the modern system and of earlier regional world-systems as
well.

Systemness means that these societies are interacting with one another in important ways –
interactions are two-way, necessary, structured, regularized and reproductive. Systemic
interconnectedness exists when interactions importantly influence the lives of people within
societies, and are consequential for social continuity or social change. World-systems may not
cover the entire surface of the planet. Some extend over only parts of the Earth. The word
“world” refers to the importantly connected interaction networks in which people live, whether
these are spatially small or large.

The failures of the League of Nations strengthen the collective of world leaders and start another
international organization to facilitate global dialogue and promote human rights and
fundamental freedom. The United Nation was formed in 1945 through it has huge limitations. It
never transcended that state system and instead operated mainly as a forum for states to air their
differences and try to resolve them. This is especially apparent within the Security Council and
its outdated composition the awards veto power to each of the five countries that none the
Second World War, as well as the General Assembly’s relative lack of power and its state based
configuration.

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CONTEMPORARY GLOBAL GOVERNANCE

The term Global Governance lacks any accepted definition. As one analyst puts it: “...the
establishment and operation of social institutions (in a sense of rules of the game that serve to
define social practices, assign roles, and guide interactions among the occupants of these roles)
capable of resolving conflicts, facilitating cooperation, or, more generally alleviating collectives
action problems in a world of interdependent actors…” (Oran Young 1994, 15)

Young’s definitions properly direct our attention to the independent nature of decision
making and the attempt by actors to “manage” or produce more “orderly” responses to common
problems. But it resulting blurs two analytically distinct political processes; bargaining, which
divided the available costs and benefits between actors, and contracting, which enforces the
bargains reached. It is the enforcement of bargains that we intuitively mean by the term
governance.

Frequently noted in the existing literate, governance is not equivalent to government or

formal institutions. Global Governance is not limited to contracts between states. Governance is
a variable between the relation of anarchy and hierarchy.

Globalization and Global Governance are intimately connected. As Globalization occurs,

states lose control over their destinies; problem become “bigger” than the capacities of individual
governments, and states must delegate and possibly abdicate political authority to supranational
entities with powers that more nearly coincide with the scope of the issues and actors to be
managed.

Clearly, Global Governance is not a world government – indeed, it is better viewed as the
sum of governance processes operation in the absence of the world government. ‘Global
Governance’, is ‘any purposeful activities intended to “control” or influence someone else that
either occurs in the arena occupied by nations or, occurring at other levels, projects influence
into that arena.’ It is a process of activity, and to differentiate it from other terms, it is descriptive
rather than normative nature should be emphasized: ‘Global Governance is governing, without
sovereign authority, relationships that transcend national frontiers’.