A. What does globalization mean?
The term globalization refers to the process of integrating markets and bringing people closer together, which results in particular from the liberalization of trade, the development of means of transport for people and goods, and the impact of information and communication technologies on a global scale.
In addition to the growing interdependence of economies (economic globalization) and the intensification of competition, it is manifested by the expansion of exchanges and human interactions.
→ See Definition of Globalization
The concept of financial globalization is defined by Pillon in Les enjeux de la mondialisation: “Financial globalization is the interconnection of markets, of Ks at the national and international level, leading to a unified money market on a global scale.”
Today, financial globalization is emphasized as an essential element of globalization because it was responsible for the 2008 crisis.
B. Globalization takes several forms over time.
In the first era, it is rather goods that go from one country to another: extension of the flows in themselves.
From the 1960s onwards, globalization is more related to the opening of borders and to the progress of GATT, means of communication, transport and the advent of the MNCs.
From the 1980s onwards, a new financial and global configuration appeared with financial deregulation.
C.
Globalization is not a
finished phenomenon
:
- It is a phenomenon that is transitory and always evolving. Globalization has given rise to a new economic geography and shows the importance of intra-industry (within a sector) and intra-firm (within a company) flows.
- Today, we find an intense circulation of capital, which was at the origin of the financial crisis and of the questioning of tax havens and financial regulation. The last few years have been occupied by an attempt to put the banks back into their real business.
- We also find the establishment of an inverted imperialism: today, the imperialist model (the USA) sees its power challenged by the flow of foreign capital, notably Chinese.
- The inadequacy of Keynesian policies: is it possible today to find recovery policies, when economic policies are often constrained (especially in the EU, for example)? However, there could be a resurgence of Keynesian policies to revive a sluggish policy: we are seeing a slowdown in export growth at the global level, which is calling into question globalization as it has been done up to now.
- The search for global governance: today, international organizations (IMF, WTO) and bodies (G8, G9) are at the head of this governance.
Summary of the Economics Course on Globalization:
- I. Globalization: presentation and phases
- II. Waves of globalization
- III. The geography of globalization exchanges
- IV. Multinational firms
- V. Protectionism
