Globalization

• Cross-national interaction between individuals, corporations, and governments (actors of globalization)

• integration of global markets for:– commodities– labor– services– capital, etc.

Globalization in history

• Trade along the Silk Road between Europe and East Asia for nearly two thousand years

World Merchandise Trade % GDP

Trade Dependence (2009-2012)

Foreign Direct Investment

Globalization and the US: trade

Globalization and the US: trade

Globalization and the US: FDI

• US-owned assets abroad– 0.5 trillion dollars in 1976– 6.2 trillion dollars in 2000– 21.6 trillion dollars in 2012

• Foreign-owned assets in the US– 0.3 trillion dollars in 1976– 7.6 trillion dollars in 2000– 25.5 trillion dollars in 2012

Debates on globalization

• Normative theory– What ought to be– e.g.: “Globalization is ultimately good for poor

developing countries.”

• Positive theory– What is– e.g.: “Globalization increases economic

inequality between rich and poor countries.”

Debates on globalization

• The impact of globalization on– income inequality– unemployment– education– health care– women and children– the environment– homeland security, etc.