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GLOBAL CHANGE REVISION Understanding the Global Economy
7. Introduction to Economic Geography Approaching Globalisation Introducing Global Economy Global Economy Work and Consumption Trade and the World Economic System Colonialism and Empire
An Unequal World?
5. Poverty and Development Modernisation and Dependency Fair Trade Health, Poverty and Injustice Charitable Aid and Global Responsibility
5. Global Patterns of Urbanisation The Economics of Cities The Neo-Liberal City Democracy and Justice in the Neo-Liberal City Urban Geopolitics
5. Slavery and Neo-Slavery Global Protests: Experiences from the UK The Changing Nature of Political Space Terrorism Nationalism
Understanding the Global Economy
1. Introducing Global Geographies
* Causes of Globalisation
* Competing Views on Globalisation
* Key Global Issues Definition
* Amin and Thrift:
= Widespread political acceptance that the world has "gone global": money, markets, firms, politics, people and cultures now transcends territorial boundaries. 'Geographies seem to be shrinking, even disappearing.'
* Often associated with negative views of the global as destroying the local and leading to gross uniformity Causes
* Intensification of global independencies from the 1970s: Five Reasons
* Note: Saskia Sassen - 'Global Cities'
Increasing centrality of financial structures
Increasing importance and globalisation of knowledge e.g. Census = making people more nervous?
Internationalisation of technology
Rise of transnational oligopolies (Supplied by only a few)
Rise of transnational economic diplomacy Negative Aspects
* Plays to the hands of international Capital
* Wages brought down, WHY? Competition (mini example: Detroit)
* Pressures on workers to move
- Europe: freedom of migration BUT costly
* Gross Uniformity Less Negative Aspects
* Tendency to view globalisation as either:
- An end state and therefore remorseless (constant re-branding and 'globalising')
- A linear, single process representing uniformity (creating 'clone towns' etc)
* TNC's in poorer areas = good and bad
- Against Marxist perspective
? We are all economically linked and tied to one another due to globalisation
- Economic success relies upon stability of others: each nation economically vulnerable
- Numerous economic positives
- But: risks of contagion
- Shown through financial crisis, cause of which may be attributed to Capitalism Positives... make it up Moves by the Globalisers
Summer 09 Starbucks opened its first unbranded coffee shop in Seattle, deliberately developed "a community personality... a little neighbourhood coffee shop" Tesco's 'accused' of a similar thing in the UK in 2013
* Globalisation epochs: 1850 - 1914 1950 - 2007
* Causes of the end of globalisation
- The dot.com bubble burst
- The financial crisis
- Should we become de-globalised?
Key Global Issues?
* Life Expectancy
* Population Density
* InequalityGlobal oil prices
Greenhouse Gases Refugee 'burden'
- Total 13 million
- Africa: 2.7 million
- Europe: Nearly 500, 000
* Population, economy, society, culture, entrainment inextricably linked
* Where you live affects your life chances at both a local and global scale ? lottery of location
2. Approaching Globalisation Key Issues
* What is globalisation?
* Geography and globalisation
* Conclusions What is Globalisation?
* "The growing interconnectedness and interrelatedness of all aspects of society" (Jones, 2010)
* Three issues emerge from this definition:
- 'Growing' - indicates change, acceleration
- 'Interconnected' and 'interrelated' - suggest connections that are deep and extensive, leading to reliance at global scale. e.g. Financial crisis: Began when mortgages were sold wrongly in the US
- 'All aspects of society' - not just economic, but also political, social, cultural
Processes an global interactions in many spheres of life Geography and Globalisation Jones (2010): 3 issues that shape perspectives on globalisation;
- Underlying framework of assumptions (e.g. neoliberal, Marxist...)
- The assumptions they bring to their understandings
- Our framework affects our perspective
* Is globalisation a single phenomenon?
- Many different processes to consider?
* The disciplinary context
- (Economics, political science, history...)
- Politics example: work affects perception of globalisation Geography is history?
* The world is flat (Friedman)
- World as a single economic space
- Is globalisation the end of geography?
- "Geography is dead" idea is based on certain understandings of what geography is...
* Dicken on economic geographies of globalisations:
- "many of the things we use in our daily lives are derived from an increasingly complex geography of production, distribution and consumption, whose scale has become, if not totally global, at least vastly more extensive, and whose choreography has become increasingly intricate" (2011:3)
* Globalisation is an occurring process of production, distribution and consumption at various different scales
* New geographies are constantly being reproduced
- a "transformation space I economic relationships across geographical space" rather than the annihilation of geographical space.
Globalisation is not the only spatial process:
- Localising processes (the concentration of certain kinds of economic activity)
- Internationalising processes (simple spread of activity across borders, little integration)
- Globalising processes (extensive spread ad high levels of integration)
- Regionalising processes (EU, regional economic agreements/partnerships) (Dicken 2011)
Agnew (2009) on 'Globalisation and Sovereignty'
- There is an argument that 'globalisation' means the decline of the state
- The territorial basis of its power (its sovereignty) is increasingly 'undone' because of globalising pressures NOTE: Sovereignty: the power to exert authority within your own territory. Globalisation = decline of state and sovereignty?
- This is another variant of the 'geography is dead ' argument
Political geographers reject these arguments
State sovereignty has always been more complex than is often claimed - have things changed that much?
The state, while perhaps transformed in many ways, retains extraordinary powers; maintaining armies, deciding on global treaties on trade, deciding who can live where and under what conditions...
Approaches to Globalisation
* Three main approaches:
- E.g. Freidman, Ohmae
- Present a vision of the world where "nation-states are no longer significant actors or meaningful economic units"
- "Consumer tastes and cultures are homogenised and satisfied through the provision of standardisation of global products created by global corporations with no allegiance to place or community." (Dicken, 2011)
- Globalisation is inevitable
- The solution to economic problems
- E.g. Hurst and Thompson
- Argument is of historical nature - now we are less globalised?
- Claims about globalisation are vastly exaggerated
- Period 1870-1913 was actually more globalised by certain measures (levels of international trade and investment, global migration)
- Levels of international trade and investment attained in late 19th century were only reached once more in late 20th century
- Migration today is less prevalent that in this period...
- Counter argument: But how deep and complex were these relations compared to today?
- Dicken and Agnew both
- Middle ground
- Changes are taking place
- They are gradual, continuities with that past The Myths of Globalisation
* Myth: not necessarily a lie, based on truth with foggy origin
- The world id flat
- Globalisation is new
- Globalisation equates to neo-liberalism
- Globalisation requires welfare cuts
- That there is no alternative (TINA)
= "powerful and widely accepted or popular ideas about globalisation" Agnew, 2009 Conclusions
* The world is not flat
* The world is not borderless
* Global corporations do not rule the world
* Globalisation is not always good
* It is not always bad Globalisation is an OUTCOME, not a cause ? we make the world we live in
3. Introduction to Economic Geography Note: there are lots of topics in economic geography
* Production - rising prices?
* Consumption - diversification = more bespoke products?
* Migration, especially of skills - less than 3%
* Changing Geography of Economic Activity
* Geographies of Services
* The Transnational Corporation
* E-Commerce: The Newest Economy
Commodity chains Inequalities - think about spatial distributions
Globalisation of Manufacturing Activity
* East Asia = fastest growing
* East Africa = still demands
* A growing role for exports and an interconnected World economy?
- Richest countries see the biggest growth
- Trade doubling since 1960s Trends in the location of economic geography
* Old and new international division of labour
- OLD: the developed = industrial, undeveloped = agricultural
- NEW: the developed = service, underdeveloped = manufacturing
* Spatial divisions of labour
- Types of cities e.g. Ports - historical changes
* Globalisation is qualitatively different for different countries
- Some thrive some don't
- Depends on what they have
- E.g. Ability to replicate = easily substituted
* Export led growth
- E.g. Singapore Case Study: China Note: Where do all the statistics come from?
* 2005 = crisis affected imports and exports
* Chinese energy consumption in comparative perspective
- Population versus energy consumption?
- Better than the USA
- Yet still huge inequality with all other nations There is a continued importance of the 'core'
- Employment in the global clothing industries (Dicken, 2009)
* Just in time production/just in case
- Over production = not profitable
- So less production BUT
- Increased diversity: Devolving risk?
- Production runs brought together due to these change in demand
* Export processing zones
- Governments see zones suitable to attract
- E.g. Lower taxes, cheaper workforce
- Many incentives to make zones
* "A relatively small, geographically separated area within a country, the purpose of which is to attract export-orientated industries, by offering then the especially favourable investment and trade conditions" (Dicken, 2003)
* Forces of Agglomeration
- Agglomeration and conglomeration, e.g. Cambridge?
- Eastern Asian ports: lots of competition = more innovation and success? BUT dead weight loss risk
- American Rust Belt: Close to borders and access to foreign countries. BUT, cheaper workers?
- Europe: Few, complacency?
Geography of Services
* Defining 'services'
* More complex things have come about with technology
* Things that can now be globalised:
- Trade, hotel,
- Communication restaurant
* Services 'lubricating' manufacturing
* The internationalisation of services
- FDI in service: "Investment which occurs across national boundaries, that is, when a firm from one country buys a controlling investment in a firm in another country or when a firm sets up a branch or subsidiary in another country," (Dicken, 2003). There is a global imbalance of FDI E.g. Less in Eastern Asia - Maybe reliant on unreliable aspects?
- Producer and consumer services (research the distinction)
- Accountancy architecture, advertising, finance, law
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