Very Important Final Paper-7pages

PROCESSES  OF  GLOBALIZATION

2.2  INTS  2370

Digital  Globalization:  The  New  Era  of  Global  Flows

• Data  flows  transmitting  information,  ideas,  and  innovation • Rise  of  ”micro-­‐multinationals’  and  ‘born  globals’  (86%) • Core  dominates  but  south-­‐south trade  is  growing  the  fastest • Challenges  for  firms: organization,  branding,  consumer/   supplier  relationships,  asset  allocation,  competition,  risks

• Challenges  for  policy  makers:  strategy,  regulation,  addressing   dislocations,  human  capital,  infrastructure,  business/   institutional  environment,  data  privacy  and  security

Global  Production  Networks

Globalization:  geographically  extensive  and  functionally   integrated  networks  across  national  boundaries  not  the  world • Turning  inputs  into  outputs  through  production  circuits • Unevenness of  power  relations • Both  cooperation  and  competition at  the  same  time • Integrate  firms  into  structures  which  blur  traditional   organizational  boundaries

<-­‐ O ut co m es

Pr oc es se s   -­‐>

Aspects  of  GPNs Infrastructure • Formation  of  GPNs • Deterritorialization of  capital • Multiscalar regulatory  systems • Role  of  state and  international  organizations Financialization – drives  formation  and  expansion Actors • Transnational  Corporations • The  State • Labor • Consumers • Global  Civil  Society  Organizations

Significance  of  TNCs

• Ability  to  coordinate  and  control  processes  within  GPNs,  in   and  between  countries

• Arbitrage between  differences  in  the  factors of  production  and   state policies

• Geographic  flexibility  for  resources  and  operations

Major  governance  institutions

Consumers:  Global  dictators  vs.  The  long  tail  

Relevance  of  labor

Growth  in  GCSO

Localization:  Geographical  Clusters

The  Nature  of  Geographical  Clusters • Generalized  vs.  specialized  – positive  externalities • Traded  vs.  untraded  interdependencies • Formation – serendipity,  path  dependency,  reinforcement,  or   something  else?

∴ Geographical  AND  organizational  networks

Supranational  Regionalization

• Close  economic  interdependency  between  geographically   contiguous  nation-­‐states

• E.g.  EU,  NAFTA,  MERCOSUR,  ASEAN • Primary  driver  – bilateral  trade  agreements,  the  gravity  model • Differences  between  the  ‘real  economy’  and  financialization

Supranational  Regionalization

The  financial  economy: • Unhindered  by  deregulation • Home  bias  of  international  investors • Currency  duopoly  (93%  in  developed  countries) • 80%  of  trading  within  the  triad • Localized  derivatives  trading  due  to  tax/  legal/  regulatory/   rules/  normative  differences

• Weak  Basel  II  Accords/  limited  bankruptcy

Responses  

• Financial  development  in  the  image  of  ‘sophisticated’  financial   markets

• Monetary  unions • Dollarization,  currency  pegs/  boards • A  global  currency?