UPSC CSE Prelims 2024

Globalization

  • Intro: Globalization defined as growing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information

  • Those who praise globalization:
    • Kofi Anna- talking against globalization is like talking against gravity .
    • Marshall McLuhan says globalization has made the world a “global village.”
    • Thomas Friedman-
      • Says the world has become flat due to globalization.
      • The Golden Arches Theory of Conflict Prevention was proposed by economist Thomas Friedman as a way of explaining how globalization affects foreign policy and conflict. Essentially, the Theory points out that no two countries that both have McDonald's franchises have ever gone to war. The reasoning behind this correlation, Friedman says, is that once economies become sufficiently integrated, both the cost of going to war and the amount of contact between two countries will increase. Both these factors lead to more effective conflict resolution, as states will attempt to pursue the more economically beneficial option
      • He says COVID has given second lease of life to globalization. The amount of scientific efforts to tackle this global pandemic is unparalleled.
    • Jagdish Bhagwati in his book- In defence of globalization- says globalization has a human face, we need to make that face agreeable . says that globalization has been the most powerful force for human upliftment.

  • Critics:
    • Joseph Stiglitz- book- “globalization and its discontents”
      • Says need for transparency in global institutions
      • Says globalization was oversold, the gains in GDP were over estimated and the losses, underestimated
      • The consequences of this overselling has been undermining of confidence in the elites that advocated globalization.
      • Globalization and trade liberalization were supposed to make us all better off through the mechanism of trickle-down economics. What we seem to be seeing instead what is trickle up economic‘s accompanied by destruction of democratic politics as we moved ever closer to a system of one dollar one vote as opposed to one person one vote
      • In his book “people, power and profits” he talks about growing resentment against globalization the world over. Calls for “progressive capitalism” that is less profit and more people centric.
    • Prof Ramesh Thakur- article- the dark side of globalization -
      • rise of non state actors (uncivil society)
      • no end of history only end of geography
      • Says capital mobility with labour immobility has declined powers of developing countries.
    • Arundhati Roy- book capitalism:a ghost story.
      • Says it has increased inequality, environmental degrading,child labour.
      • Globalization is a mutant form captialism, remote controlled and digitally operated.
    • I Wallerstein,AG Frank,Sameer Amin- apply dependency theory to show drain of wealth( world systems theory)
    • Thomas Picketty- shows rising inequalities in his book- capitalism in 21st century.


  • World moving towards de-globalization-

    • Shashi in book new world disorder- if the great struggles of 20th century were b/w left and right, the conflict of the 21st century will be between open and closed.
    • 1999 Battle of Seattle when protests by environment groups and trade unions against WTO meet took place
    • While younger, better educated workers located in Cosmopolitan urban centres such as New York and London have seen phenomenal increase in their income, the older less educated workers in the rusting industrial belts of northern England and America have lost their jobs to manufacturers overseas overseas
    • It was suggested that globalization would spread from global core(West) to the global periphery (East). However in recent times waves of globalization are moving in opposite direction- from the global periphery to the global core. Rather than inter connectedness, the West is trying to fence itself off from periphery by implementing restrictions on migration, adopting protectionist policy, and allowing rise of nationalism. It is said that the core could ultimately be less globalized than the Periphery.
    • Globalization will remain fundamental and even Some countries with strong economic sectors will be leaders in globalization, others will likely continue to oppose it. The dynamics of global financial markets will outpace the dynamics of the global labour market, globalization of science will progress faster than the globalization of culture.
    • The great divide in international relations will be between the winners and losers of globalization process.
    • 2008 Lehman brother crisis
    • Election of Trump
      • Renegotiating NAFTA to focus more on domestic hob creation
      • Making WTO appellate  tribunal defunct
      • H1B visa policies
      • Buy and make American
    • The above policies would be taken forward by Biden in the economic sphere who talked of bringing back jobs to America in his election campaign.
    • Europe
      • Brexit, Grexit have further weakened EU with internal rift developing among nations
      • In Germany AFD a right wing party is against globalization and came third in parliamentary elections
      • French presidential candidate Marine Le pen had said- the main thing at stake in this election is the rampant globalization that is endangering our civilization.”
    • Harvard economist Dani Rodrik argues that economic integration has led to social disintegration.
    • globalization, democracy, and national sovereignty. Identifying this trilemma, Harvard economist Dani Rodrik argued that it is not possible to have all three of them. 
    • growing intolerance towards migrants , rise of Islamophobia in Europe.
    • Backlash against hispanics and muslims in US
    • growing inequality in the world pointed out by Oxfam reports and Works of Thomas piketty
    • Post COVID-
      • From 10 lessons for a post pandemic world-
        • The eighth lesson says “globalization is not dead.” He argues that global supply chains make us vulnerable to critical shortages like medical goods, rare earth minerals,etc.He rightly points out that fear of globalization is actually fear of dependence on China. But in defence of globalization he rightly argues - “The efforts against globalization run up against one of the most powerful forces on the planet-comparative advantage .”If Globalization was the cause of spread of the virus then, it will also be the solution. Infact Thomas Friedman has said that this is the best time for science and globalization for collective efforts to find a solution to this pandemic. Take the example of Astrazeneca vaccine(recently in news). It is developed in Oxford, produced in India and supplied to the world. 
      • EAM Jaishankar has called for “decentralized globalization” with different centres of production so that the world is not dependent on single geography or single set of supply chain
      • People have blamed globalization for the spread of COVID
      • Countries like India focusing on self sufficiency through ANB
      • Dual circulation” is the name that Beijing has given this approach favoured by Mr. Xi, of boosting the domestic economy (or internal circulation) while recalibrating China’s external relations (the other circulation) – an anodyne term that blurs the increasing importance of self-reliance in Beijing’s outlook today.
      • trade restrictions would be unpredictable as countries try to find a balance between domestic and global imperatives.
      • Will strengthen state and reinforce nationalism
      • It is the straw that breaks the camel’s back of economic globalization.
      • Shivshankar Menon warns, “we are headed for a poorer, meaner, and smaller world.
      • Globalization based on global village will give way to gated globalization based on economic and political familiarities- Samir Saran.
      • The coronavirus may have heralded the sudden onset of what Ian Bremmer calls a “G-Zero” world — one that is at once multipolar, leaderless, and likely besieged by renewed geopolitical conflict.
      • the weaponisation of supply chains is inevitable when they extend across geopolitical rivals. Supply chain decisions, earlier driven by cost reduction and market access, must now account for geopolitics.
      • Attributing nationality to a multinational is no longer an oxymoron. Resilience is the new competitiveness. Globalization is taking a few steps back.
      • With a dependency of over 80% in more than 300 categories of goods (six-digit level HS Codes) India’s burgeoning trade deficit with China has triggered the launch of Productivity Linked Incentives (PLI) across 13 key sectors including automobiles, chemicals, electronics and textiles.
    • post COVID- opportunity is there for making a case for finding a middle ground between unhindered globalization and total economic protectionism, or what Ashutosh Varshney calls “compassionate  globalism.”



  • Conclusion: In the post COVID world we need a new template of globalization based on fairness, equality and humanity- PM Modi

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