GLOBALIZATION OF

ECONOMY

Prepared by Ms. Jobalyn D. Langayo

The Contemporary World/ Ang Kasalukuyang
Daigdig
 Definition of economic globalization
 Medieval prelude
 Actors
that facilitated the globalization of the
economy
 Categories of the World System
 Stages of growth

CONTENTS:
Genesis of the state
 Stage1: Looting Peace of Westphalia gave Birth of
 Stage 2: truce Internationalist Ideas
 Stage3: Tribute
Liberal Internationalism
 Stage4 : Occupation Nationalist Internationalism
 Stage 5: Monopoly Socialist Internationalism
 Stage 6: State
ORIGINS OF THE GLOBAL INTERSTATE


SYSTEM: THE MAKING OF THE MODERN

STATES
 yrheppire
Periphery

WORD SCRAMBLE
 ocimnoce oitailnabolgz
economic globalization

WORLD SCRAMBLE
 ErcO
Core

WORLD SCRAMBLE
Iesm yrhpireep
Semi Periphery
lerepud
prelude
laretxen raeas
External areas
Trade Surplus: When a country exports more than its imports.
Trade Deficit: When a country imports more than its exports.
Absolute Advantage: A country enjoys an absolute advantage if it uses
fewer resources to produce goods.
Tarrif: Tax on imports.
Production: The process which inputs are combined and transformed
into output.

DEFINITION OF TERMS
Free Trade: is formed when two or more countries agree to abolish
all internal barriers to trade among themselves.
Economy: Derived from the Greek word oikonomos, meaning "one
who manages a household," economy was not used in the modern
sense of the economic system of a country or area until the
nineteenth and twentieth centuries.
Economy also refers to the way in which resources, especially those
in shortage, are managed in a competent and appropriate
manner.

DEFINITION OF TERMS
 “The Global free trade has done more
harm than good”
What is global
economy?
PHOTO BY: ADELLA ANDERSON
 Economic globalization refers to the increasing
interdependence of world economies as a result of the
growing scale of cross-border trade of commodities and
services, flow of international capital and wide and rapid
spread of technologies. It reflects the continuing
expansion and mutual integration of market frontiers, and
is an irreversible trend for the economic development in
the whole world at the turn of the millennium

ECONOMIC GLOBALIZATION
Before the 16th century, when Western
Europe embarked on a path of capitalist
development, “ feudalism” dominated West
European society. Between the years 1150-
11300, both population as well as commerce
expanded within the confine of the feudal
system. However, from years 1300-1450,
this expansion ceased, creating a severe
economic crisis. According to Wallerstein,
the feudal crisis was probably precipitated
by the interaction of the following factors:

MEDIEVAL PRELUDE
  Agriculturalproduction fell or remained stagnant. This meant that the
burden of peasant producers increased as the ruling class expanded.
 The economic cycle of the feudal economy reached its optimum level
 A shiftin climalogotical conditions decreased agricultural productivity
and contributed to an increase in epidemics within the population.

MEDIEVAL PRELUDE
  Discoveries and inventions ( technology, equipment,
travel, telecommunication, machinery, etc.);
 The creation of multinational corporations;
 Circulation of finance, ideas, cultures;
 Free market ideology; and
 More liberal economic policies, laws, economies and
social movements.

ACTORS THAT FACILITATED THE GLOBALIZATION OF

THE ECONOMY
In what category do
the Philippines
belong?
CATEGORIES
OF THE
WORLD
SYSTEM
Stages 1 and 2
a. Bureaucratization
 Thisprocess aided the limited but growing power of the king.
By increasing the state power to collect taxes, the kings
eventually increased state power to borrow money and
thereby further expand the state bureaucracy. At the end of
this stage, the monarch had become the supreme power
and instituted what has been called “ absolute monarchy”.

STAGES OF GROWTH
b. Homogenization of the local population
To underline state involvement in the new capitalist system and
encourage the rise of indigenous capitalist groups, many core
states expelled minorities. These independent capitalist groups,
without deep rooted local ties, were perceived as threats to the
development of strong core states.
c. Expansion of the Militia
This is to support the centralized monarchy and to protect the
new state from invasions.

STAGES OF GROWTH
d. The concept of absolutism
Introduced at this time related to the relative independence of
the monarch from previously established laws. This distinction
freed the king from prior feudal laws.
e. Diversification of economic activities
To maximize profits and strengthen the position of the local
bourgeoisie.

STAGES OF GROWTH
Stages 3 and 4 ( 18th century and beyond)
Industrial rather than agricultural capitalism represented this era.
With the shifting emphasis on industrial production, the following
reactions characterized this period:
a. European states participated in active exploration fro the
exploitation of new markets.

STAGES OF GROWTH
 b. Competitive world systems such as the Indian Ocean system
were absorbed into the expanding European world system. With
the independence of the Latin American countries, these areas
as well as previously isolated zones in the interior of the
American continent entered as peripheral zones in the world
economy.
c. The inclusion of Africa and the Asian continents as peripheral
zones increased the available surplus, allowing other areas such
as the U. S. and Germany to enhance their core status.

STAGES OF GROWTH
 During this phase, the core regions shifted from a combination
of agricultural and industrial interests to purely industrial
concerns. Between 1700, England was Europe’s leading
industrial producer as well as the leader in agricultural
production. By 1900’s, only 10% of England’s population was
engaged in agriculture.
 By the 1900’s, with the shift toward manufacturing, core areas
encouraged the rise of industries in peripheral and semi-
peripheral zones so that they could sell machines to these
regions.

STAGES OF GROWTH
End of topic!

THANK YOU FOR LISTENING

 Reference
The Contemporary World by Dr. Darwin Don Mallo Dacles and
Kenneth L. Maslang , MAED