Economic Globalization

Globalization is the tsunami wave that’s coming up on the shores of every nation. And all the rules are changing.
- Michael Fairbanks

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  • Michael Fairbanks on Economic Globalization as a Tsunami Wave

    Globalization is the tsunami wave that’s coming up on the shores of every nation. And all the rules are changing.

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  • Marc Coleman on Economic Globalization and Culture

    Globalization is not a threat to your culture or your sovereignty. In Ireland, we’ve actually used globalization not only to strengthen our sovereignty and independence, but actually to sell our culture around the rest of the world. So you’ve got River Dance, you’ve got great Irish rock bands like U2, you’ve obviously got Guinness, and you’ve got Irish culture, poetry…  And that shows how a small country can use globalization to huge success.

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  • Marc Coleman on the Cultural Challenges of Economic Globalization

    It does pose certain challenges in the sense that the lure of international capitalism can lead people to forget their identity. But this brings us back to the values of society. And international global capitalism is not the be-all and end-all of any country’s existence. Man cannot live by bread alone. So, while it’s great and important to tap into all of the opportunities that globalization provides, it forces you to be equally vigilant about defending your cultural values so that you won’t sell those values out on the free market. And, in other words, a culture that is strong and vibrant … it will not be threatened by globalization.

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  • Marc Coleman on Internal Free Markets

    I think if you try to get the benefits of an international, globalized free market economy without practicing what you preach in the way your internal economy works, what you’re going to find is that the benefits are concentrated amongst a powerful elite, and that’s going to undermine the social stability and solidarity behind the whole project.

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  • Marc Coleman on Economic Globalization, Bono and U2

    I have huge admiration for Bono. He’s one of our biggest exports. And one of the reasons Bono and U2 have been so fantastic for the Irish economy is because they went out in there, into the global free market, and they competed …If I were telling developing countries what’s the best way to get rich, it’s to do what Bono did, do what U2 did: get really, really good at something and sell it on the international market.

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  • Marc Coleman on Economic Globalization and Religious Freedom

    Likewise, governments ought to ensure religious freedom among the populace, which includes giving religious groups the leeway to pursue those charitable activities and formative initiatives for which their various missions call, and protect them from unfair discrimination….Lastly, governments facing globalization must protect the natural right of its citizens to private property, since this is the only way many of them can weather the vast economic changes, and it is part of their dignity as human beings. Private property gives each level of society the ability to do what they need to do, when they need to do it, or if they cannot, to find someone who can and negotiate this in an efficient manner. Without it, even good government initiatives defeat themselves.

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  • Samuel Gregg on Economic Globalization and Poverty Alleviation

    In the 18th Century, pretty much everyone, except a very small segment of society, was poor. Everyone. Imagine that. Everyone is poor.

    Then, what happens? We have industrialization and we have what some people would describe as the first age of globalization. And what you suddenly see from about the end of the 18th Century onwards, increases in wealth. Society, as a whole, starts to get wealthier. People start to live longer. People start to have better-quality life. People start to do things and travel, that they had never been able to do before. And this happened in a very quick period of time.

    And the answer is free markets, the answer is property rights, the answer is rule of law, and the answer is global free market. That is what happened during this period of time, and that explains why so many people escaped poverty in a relatively short period of time, compared to their ancestors, who had basically lived the same type of lifestyle for hundreds of years.

    So, what you see, historically speaking, is that when people – all people, rich and poor, from all around the world – are able to connect themselves to networks of productivity, what you see is increases in wealth and better-quality lives for everyone, not just the elites in the very wealthy segments of society, but also the poor and the lower-middle class.

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Economic Globalization Defined

Economic globalization involves societies around the globe becoming interdependent by trading—whether ideas, natural resources, finished products or labor. If such exchanges are uncoerced and free of deceit, they tend to be win-win exchanges. Country A’s land is best for growing fruit. Country B’s land has a poor climate for growing fruit but is well-suited for producing cereal grains. If the two countries freely exchange agricultural goods instead of each trying to grow all of its own food, both countries will benefit. Such exchanges are globalization at its best—countries entering freely into win-win exchanges to achieve greater abundance and diversity.

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Table of Contents

  • Economic Globalization Defined
  • Economic Globalization and Growth
  • Economic Globalization—Challenges and Critique
  • Economic Globalization and Civil Institutions
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Economic Globalization and Growth

Numerous studies have found a strong correlation between economic growth at all levels of a society and the degree to which that society is linked to global networks of exchange and productivity. For instance, a study published in 2005 by Axel Dreher using panel data for 123 countries over 30 years found that the countries with the lowest growth rates were those that had failed to globalize or that actively prevented globalization.

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Economic Globalization—Challenges and Critique

Although globalization is clearly linked to economic growth for rich and poor alike, many factors come into play in the process of globalization. These need to be understood if globalization’s negative effects are to be minimized.

Globalization has meant enormous change in the last several decades, particularly with the invention of such omnipresent technologies as computer networking. This change has led many to lament the cultural, economic and religious difficulties that have surfaced in globalization’s wake. Some of the problems include:  

  • The popular desire for the goods and services that globalization affords makes it almost an unstoppable force. Customs, traditions or mores that stand in the way of such a force can sometimes be swept aside.
  • The human person seems to become a helpless, faceless individual in the face of market forces that are perceived as more important than human dignity.
  • Open borders and opportunities far from home tend to draw people away from extended families and familiar neighborhoods, leading to societies where social bonds are weak and civil institutions attenuated. This in turn leaves the individual with little between him and the state, or between him and mass culture.
  • Misunderstandings of globalization can often lead to the spread of consumerism, materialism, and even hedonism.

Much of what is blamed on globalization is simply the result of perennial human fallibility. Pre-globalized countries have their own cultural problems, sometimes quite severe. And the tendency to romanticize pre-globalized cultures leads us to blame any evidence of moral corruption on the process of globalization at work in the developing country. At other times, the moral corruption may be caused not by global free markets but by forms of aid that encourage dependency and, with it, various social pathologies. 

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Economic Globalization and Civil Institutions

These are important considerations if we are to achieve a balanced and accurate understanding of globalization; but we should not pretend that globalization isn’t without its cultural challenges. Globalization has helped to lift hundreds of millions of people out of abject poverty, but the cultural challenges that attend it are real. A promising area of research and work to address such problems involves the work of 19th Century French social philosopher Alexis de Tocqueville and his call to strengthen religious and civil institutions and, with them, the family. More broadly, and following the work of Robert Nisbet, it also calls on people to limit the central government from arrogating to itself authority that best remains with families and local civil institutions.

This is not to suggest that an easy solution lies before us. At times, local communities are marked by deep corruption and human rights abuses, with even the institution of the family corrupted into a tool for the routine abuse of women and children. Often, too, a central government has crowded out a community’s local institutions over a period of several decades, and for the government to simply withdraw its bureaucracies will not undo the damage overnight. In such cases, the transition to a culture marked by strong families and robust civil institutions in the context of ordered liberty and limited government would be the work of decades and generations, with political, religious, academic, charitable and entrepreneurial leaders all playing important roles.

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