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Globalization is a contemporary concept that entails the integration of global economic, political, and social aspects of many societies. In particular, in recent times, more efforts are being made towards the integration of the world economy. As the integration of the global economy increases, the national governments are gradually losing their influence, and in the process they are becoming less relevant.
In its wake, globalization has opened up global markets in many countries controlled by a single global entity. As a result, national governments no longer have much influence on the implementation of social programs, the management of macroeconomic outcomes, and regulation of the industrial economy.
Evidently, the new global concept has led to increased cross border labor mobility, increased flows of goods and services, increased technology transfer as well as improvements in finance and investment. The improvement in cross border movement of capital has led to the emergence of a global market with common prices for goods and services regardless of the nation-state regulation.
This implies that the power of nation-state, which previously controlled all business activities, is diminishing. In addition, globalization has affected national institutional arrangements, changes in industrial policies and welfare systems of many countries.
In other words, globalization will ultimately lead to a worldwide convergence of all national economic systems resulting to free market capitalism (Cable 1995, p. 23). Previously, capitalism and democratic development were common principles common upheld by most national governments. However, in the wake of globalization, capitalism is increasingly diminishing as markets are become liberalized. Globalization just like medieval transnational system limits the state power of countries.
Globalization and the Global Networks
In general, globalization refers to the global social interaction at different levels. As Mann points out, “social interaction in the new world order can occur at five different levels: global, transnational, international, national and local” (Mann 1997, p. 472). Both national and local networks involve socioeconomic relationships at national and local level respectively i.e. within a nation-state such as local support groups.
International networks, on the other hand, involve relations established between nations. Transnational and global networks involve networks constituted between many nations or incorporating many nation-state networks. Typical examples of such networks include formal institutions that regulate the world military and economic affairs.
These include institutions such NATO, WTO, UN and the EU to which many nations are signatories. To some extent, local, national and inter-national interaction networks act to override the nation-state. However, the geographic boundaries still remain relevant under these modes of interaction.
In contrast, transnational and global networks have the ability to operate with less regard to national boundaries. Conversely, the transnational and global networks are never affected by nation-state laws or policies. Transnational networks include the cultural and religious movements that may be large enough to cover an entire continent in scope or cover a particular region comprising of two or more countries. Thus, transnational networks, though commonly though to be worldwide, may not be global but rather regional.
Global networks, on the other hand, operate more or less on a global scale. Usually, the networks involve aspects such as socialism, capitalism, feminism or environmental issues. Institutions such as the IMF, Amnesty international, the Red Cross and the UN, are global in scope (Cable 1995, p. 41).
Of most significance, however, are the networks that dominate capitalism. Capitalist networks regulate the trade relations more or less globally. Networks that dominate capitalism have been on the rise since the collapse of the Soviet Communism. The extensive occurrence of capitalist networks implies the likelihood of a unified global system. Currently, capitalism remains central to most countries’ local and national networks (Berger, & Dore 1997, p.79).
In light of the increasing influence of capitalist networks at a global scale, a world economic order seems feasible. Currently, the global networks especially capitalist networks have much influence on international and national structures compared to the local networks. In contrast, in medieval times, the international, transnational and local networks bore much influence than national networks. Thus, it suffices to conclude that, even in the wake of globalization, the international and transnational networks remain unchanged.
However, as the nation-state evolved over several years, the transnational capitalist structures became embedded in national networks and national institutions. Thus, fundamentally, the current national networks constitute both the transnational and national economies (Poogi 1990, p. 165). Apparently, the nation-state has limited influence on the networks of interaction, which was the same case in medieval times.
Globalization and Global Economic Integration
In most cases, globalization means the extensive integration of multiple economies to the point where the significance of national or international networks declines allowing the emergence of national and global networks. Thus, the concept of a global economy implies the improvement of international ties to an extent that a new global network is established.
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In assessing the extent of global economic integration, whether in finance, trade or investment, the amount of international flows is vital. The growth of global economic networks depends on international and national networks as much as it does on the medieval transnational networks (Mann 1997, p. 474).
Two issues arise with regard to the impacts of globalization upon national or international networks relative to the medieval transnational networks. The first issue is whether the global and transnational networks increasingly growing in importance compared to national and international networks.
Given the unprecedented growth in global markets especially involving financial markets, the contribution of national and international networks to this growth is minimal relative to the transnational ones. This implies that the world economy resulting from globalization is indeed transnational in nature displacing the national and international networks.
The state, in this case, facilitates this role just like in medieval times. In other words, the idea global economic integration continues to expand independent of national and international networks but is highly dependent on transnational networks.
Obviously, due to globalization, economic exchange occurs freely across national boundaries. In this sense, the territorial boundaries no longer hold any significance in most economic transactions.
However, it is necessary to note the difference between globalization and internationalization, which lays emphasis on the nation-state. It is clear that globalization does not recognize the nation-state as a significant power or economic actor just like in medieval times. Moreover, globalization can involve national or state-owned institutions but independent of national networks.
Globalization and Transnational Networks
The medieval transnational networks and the globalization bear one thing in common; political and economic liberalization. In contrast, the evolution of the modern state involved a form of confinement of social networks of interaction that were previously local or transnational in scope.
As a result, the social networks became coordinated solely at the national level. As Mann notes, “the nation state led to the confinement of the social networks,” (Mann 1997, p. 481). Thus, nation-state became the coordinating and a regulating authority of social relations whether at local or international level. Mann further argues that “the modern state power promotes the society-state relations in a way that politicizes the social networks more than the medieval states did” (Mann 1997, p. 491).
The central issue today, however, is whether the relations between the state and the society occasioned by the modern state are disappearing giving way to global networks. This can be viewed in multiple perspectives: economic, military, social and environmental, all of which threaten to displace the powers vested in nation-state (Cable 1995, p. 51). However, in contrast to medieval transnational networks, the new forms of transnational networks are not entirely incorporated in the nation-state systems.
Two contrasting views arise with regard to the fate of the nation-state powers in the wake of globalization. First, the new forms of transnational networks are likely to cause a radical power shift resulting to global governance. The second school of thought holds the view that the new forms of transnational networks would ultimately result to a world government that regulates all the nation-state.
This implies the establishment of formal international institutions that interlink nation-states as well as social institutions primarily through communication technology. The result is global governance followed by diminishing powers and influence of nation states (Slaughter 1997, p. 184)
Another perspective to the fate of nation-states draws the conclusion that the increase in power of international institutions is not entirely at the expense of nation-states (Slaughter 1997, p. 192).
In stead, the current international bodies involved in emerging international issues such as terrorism, environmental degradation and drug trafficking, have led to the establishment of a trans-governmental system thus preserving the integrity of nation-states (Cable1995, p. 38).
National governments form distinct regulatory agencies such as law enforcement. Such agencies cooperate with other agencies abroad thus resulting to trans-governmental networks much like the medieval transnational networks. The new transnational system is attributed to the increased global economic cooperation and global competition.
With regard to the growth of global networks and the disintegration of state power or national economies, there are strong disagreements. Stallings contends that capitalist structures are gradually becoming transnational and in the process displacing the economic and political power networks of nation-states (Stallings 1995, p. 127).
Indeed, the large volume of cross-boundary capital, labor and goods flows attest to this assertion. On the other hand, Rhodes argues that, globalization causes uniform changes in social and social economic policies rendering the regulatory powers of the nation-states irrelevant.
Economically, most governments have adopted changes in trade, finance and investment that herald the emergence of a new global capitalist order. Consequently, the nation-states are increasingly becoming powerless as transnational markets and multinational corporations influence most of the policy choices.
Globalization and Politics
There are several variants of global-society theories that attempt to explain the concept of globalization and international cooperation. In recent times, much attention has been directed to world peace and regional conflicts. According to the global-society perspective, the increased concerns for environment, global peace and modernization are misdirected (Poogi 1990, p. 168).
The theory suggests that the rise of institutions that aim to promote international cooperation is one way of jointly mitigating or eliminating international problems. However, the theory suggests that this has led to increased interdependence between nation-sates as even powerful states fail to unilaterally tackle various issues such as terrorism, communicable diseases and environmental issues.
The effects resulting from non-state organizations, which operate across national boundaries, are profound. The states are increasingly becoming less influential in most international social and economic issues. Powerful organizations such as Organization of Petroleum Exporting Countries have more influence on the global front than individual states. Additionally, joint actions by financial institutions can have a profound effect on the world economy.
From a realist perspective, a contemporary international system is necessary in international relations. According to this theory, the lack of a central authority, that is central to the international system to settle international disputes especially with regard to national security, make nation-states insecure (Berger, & Dore 1997, p.81).
Thus, realists view international conflicts as integral to the international system. Additionally, realists view the regional groups as influential actors in the international system. In medieval times, empires or ancient civilizations were the primary entities in the international system. However, the establishment of sovereign states led to the concept of “national interests” (Berger, & Dore 1997, p.82). Globalization, on the other hand, has led to the dissolution of the nation-state concept much like during the medieval times.
Globalization has contributed to the shrinkage of distance due to improvements in information technology and advancement in transport technology. However, globalization has also led to the expansion of many international institutions that operate regardless of the national boundaries. In particular, globalization has led to the creation of a world market and a form of global governance.
From a historical perspective, social networks of interactions have been transnational (Mann 1997, p. 494) involving multiple societies from different places. Similarly, globalization has led to expansion of financial markets, investments and democratic structures as well as formal institutions that operate national boundaries at the expense of nation-state powers. In light of this, I would agree that the more things change the more they stay the same.
Berger, S., & Dore, R., 1997. National Diversity and Global Capitalism. Ithaca, NY: Cornell University Press.
Cable, V., 1995. Diminished Nation State: A Study in the Loss of Economic Power. Daedalus, 124 (2), pp. 23-53.
Mann, M., 1997. Has Globalization Ended the Rise and Rise of the Nation-State? Review of International Political Economy, 4 (3), pp. 472-496.
Poogi, G., 1990. The State: Its Nature, Development and Prospects. Stanford: Stanford University Press.
Slaughter, A., 1997. The Real New World Order. Foreign Affairs, 76 (5), pp. 183-197.
Stallings, B., 1995. Global Change, Regional Response. Cambridge: Cambridge University Press.