KEYSTONE COLLEGE

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A Module in

THE CONTEMPORARY WORLD

Author:

ROSE P. GENEROSA

Approval:

This is to certify that this module in The Contemporary World is the official
module for the 1st Semester of Academic Year 2020-2021.

ROSE P. GENEROSA

Department Head-College of Teacher Education

DR. JHOSEPHINE A. FLORES

Keystone College President

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 MODULE 1: GLOBALIZATION

What is Globalization?
Globalization means the speedup of movements and exchanges (of human beings,
goods, and services, capital, technologies or cultural practices) all over the planet. One of
the effects of globalization is that it promotes and increases interactions between different
regions and populations around the globe.
According to WHO, globalization can be defined as ” the increased
interconnectedness and interdependence of peoples and countries. It is generally
understood to include two inter-related elements: the opening of international borders to
increasingly fast flows of goods, services, finance, people and ideas; and the changes in
institutions and policies at national and international levels that facilitate or promote such
flows.”
What Is Globalization in the Economy?
According to the Committee for Development Policy (a subsidiary body of the
United Nations), from an economic point of view, globalization can be defined as:
“(…) the increasing interdependence of world economies as a result of the growing scale
of cross-border trade of commodities and services, the flow of international capital and
the wide and rapid spread of technologies. It reflects the continuing expansion and mutual
integration of market frontiers (…) and the rapid growing significance of information in
all types of productive activities and marketization are the two major driving forces for
economic globalization.”
What Is Globalization in Geography?
In geography, globalization is defined as the set of processes (economic, social,
cultural, technological, institutional) that contribute to the relationship between societies
and individuals around the world. It is a progressive process by which exchanges and
flows between different parts of the world are intensified.
The Benefits of Globalization
Globalization has benefits that cover many different areas. It reciprocally
developed economies all over the world and increased cultural exchanges. It also allowed
financial exchanges between companies, changing the paradigm of work. Many people
are nowadays citizens of the world. The origin of goods became secondary and
geographic distance is no longer a barrier for many services to happen.

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 Examples of Globalization
Because of trade developments and financial exchanges, we often think of
globalization as an economic and financial phenomenon. Nonetheless, it includes a much
wider field than just flowing of goods, services or capital. Often referred to as the
globalization concept map, some examples of globalization are:
Economic globalization: is the development of trade systems within transnational actors
such as corporations or NGOs;
Financial globalization: can be linked with the rise of a global financial system with
international financial exchanges and monetary exchanges. Stock markets, for instance,
are a great example of the financially connected global world since when one stock
market has a decline, it affects other markets negatively as well as the economy as a
whole.
Cultural globalization: refers to the interpenetration of cultures which, as a consequence,
means nations adopt principles, beliefs, and costumes of other nations, losing their unique
culture to a unique, globalized supra-culture;
Political globalization: the development and growing influence of international
organizations such as the UN or WHO means governmental action takes place at an
international level. There are other bodies operating a global level such as NGOs like
Doctors without borders or Oxfam;
Sociological globalization: information moves almost in real-time, together with the
interconnection and interdependence of events and their consequences. People move all
the time too, mixing and integrating different societies;
Technological globalization: the phenomenon by which millions of people are
interconnected thanks to the power of the digital world via platforms such as Facebook,
Instagram, Skype or Youtube.
Geographic globalization: is the new organization and hierarchy of different regions of
the world that is constantly changing. Moreover, with transportation and flying made so
easy and affordable, apart from a few countries with demanding visas, it is possible to
travel the world without barely any restrictions;
Ecological globalization: accounts for the idea of considering planet Earth as a single
global entity – a common good all societies should protect since the weather affects
everyone and we are all protected by the same atmosphere. To this regard, it is often said
that the poorest countries that have been polluting the least will suffer the most from
climate change

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ACTIVITY #1: Answer the following questions.
A. How Do We Make Globalization More Just?

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B. When Did Globalization Begin?

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 MODULE 2: THE GLOBAL ECONOMY

The global economy refers to the interconnected worldwide economic activities

that take place between multiple countries. These economic activities can have either a
positive or negative impact on the countries involved.
The global economy comprises several characteristics, such as:
Globalisation: Globalisation describes a process by which national and regional
economies, societies, and cultures have become integrated through the global network of
trade, communication, immigration, and transportation. These developments led to the
advent of the global economy. Due to the global economy and globalisation, domestic
economies have become cohesive, leading to an improvement in their performances.
International trade: International trade is considered to be an impact of globalisation. It
refers to the exchange of goods and services between different countries, and it has also
helped countries to specialise in products which they have a comparative advantage in.
This is an economic theory that refers to an economy's ability to produce goods and
services at a lower opportunity cost than its trade partners.
International finance: Money can be transferred at a faster rate between countries
compared to goods, services, and people; making international finance one of the primary
features of a global economy. International finance consists of topics like currency
exchange rates and monetary policy.
Global investment: This refers to an investment strategy that is not constrained by
geographical boundaries. Global investment mainly takes place via foreign direct
investment (FDI).
What are the benefits of global economy?
There are numerous benefits of a global economy, which include:
Free trade: Free trade is an excellent method for countries to exchange goods and
services. It also allows countries to specialise in the production of those goods in which
they have a comparative advantage.
Movement of labour: Increased migration of the labour force is advantageous for the
recipient country as well as for the workers. If a country is going through a phase of high
unemployment, workers can look for jobs in other countries. This also helps in reducing
geographical inequality.
Increased economies of scale: The specialisation of goods production in most countries
has led to advantageous economic factors such as lower average costs and lower prices
for customers.
Increased investment: Due to the presence of global economy, it has become easier for
countries to attract short-term and long-term investment. Investments in developing
countries go a long way in improving their economies.

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ACTIVITY #2: Answer the following questions.
A. What are the factors affecting global economy?

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B. What are the effects of global economy?

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 C. How does global economy work?

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D. Who controls global economy?

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 E. What are the effects of global economy?

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 MODULE 3: MARKET INTEGRATION

Market integration occurs when prices among different location or related goods
follow similar patterns in a long period. Group of prices often move proportionally to
each other and when this relation is very clear among different markets it is said that the
markets are integrated.
Market integration is defined as a process which refers to the expansion of firms
by consolidating additional marketing functions and activities under a single
management.
Removal of barriers between two markets for the same product, so that prices on
the two markets become more closely linked. Trade liberalization contributes to
international market integration.
Types of market integration
1. Horizontal integration
This occurs when a firm or agency gains control of other firms or agencies performing
similar marketing functions at the same level in the marketing sequence. In this type of
integration, some marketing agencies combine to form a union with a view to reducing
their effective number and the extent of actual competition in the market. It is
advantageous for the members who join the group.
2. Vertical integration
This occurs when a firm performs more than one activity in the sequence of the marketing
process. It is a linking together of two or more functions in the marketing process within a
single firm or under a single ownership. This type of integration makes it possible to
exercise control over both quality and quantity of the product from the beginning of the
production process until the product is ready for the consumer. It reduces the number of
middle men in the marketing channel.
a) Forward integration
If a firm assumes another function of marketing which is closer to the consumption
function, it is a case of forward integration. Example: wholesaler assuming the function
of retailing
b) Backward integration
This involves ownership or a combination of sources of suppl. Example: when a
processing firm assumes the function of assembling/purchasing the produce from the
villages.
3. Conglomeration
A combination of agencies or activities not directly related to each other may, when it
operates under a unified management, be termed a conglomeration.

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 Reasons for market integration

 To remove transaction costs

 Foster competition
 Provide better signals for optimal generation and consumption decisions.
 Improve security of supply
 Theoretically one can integrate two markets without interconnection.

Degree of integration
 Ownership integration
This occurs when all the decisions and assets of a firm are completely assumed
by another firm.
Example: a processing firm which buys a wholesale firm.
 Contract integration
This involves an agreement between two firms on certain decisions, while each
firm retains its separate identity.
Example: tie up of a dhal mill with pulse traders for supply of pulse grains.
Effects of integration
Vertical integration
 More profits by taking up additional functions
 Risk reduction through improved market co-ordination
 Improvement in bargaining power and the prospects of influencing prices
 Lowering costs through achieving operational efficiency
Horizontal integration
 Buying out a competitor in a time bound way to reduce competition
 Gaining larger share of the market and higher profits
 Attaining economies of scale
 Specializing in the trade
Conglomeration
 Risk reduction through diversification
 Acquisition of financial leverage
 Empire – building urge

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Activity #3:
A. Analyze the “global” nature of multinational corporations.

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B. Do you think the positive effects of multinational corporations outweigh the negative effects?
Why or why not?

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 C. What do you think are the ways to lessen, if not estimate, the negative consequences of
multinational corporations?

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 MODULE 4: THE GLOBAL INTERSTATE SYSTEM

It is the whole system of human interactions. The modern world-system is

structured politically as an interstate system – a system of competing and allying states.
Political Scientists commonly call this the international system, and it is the main focus of
the field of International Relations.
STRENGTHS
 It will make travel less cheaper, faster and better.
WEAKNESSES
 Imposed long-term costs on the country
 Cut down on competition between shippers and passenger carriers.
 Rising consumption of gasoline led to air pollution and a dependence on oil that
affected consumers and foreign policy for generations to come.
INSTITUTION
Institution that govern international Relations
UNITED NATION
United States President FRANKLIN ROOSEVELT coined the name united nations that
was used in the declaration of United Nation on 1 of January 1942. UN means allies to
fight against the Axis Powers in the Second World War II. Only 26 nation’s
representatives pledge their governments to:
1. Each Government pledges itself to employ its full resources, military or economic,
against those members of the tripartite pact and its adherents with which such government
is at war.

2. Each Government pledges itself to cooperate with the Governments signatory hereto
and not to make a separate armistice or peace with the enemies.

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ACTIVITY #4:
A. VENN DIAGRAM: Compare and Contrast globalism and informationalism.

B. What are the barriers to our collective learning in the age of information.

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 C. Will geopolitical boundaries and physical barriers still be relevant in the future given the nature
of information and information revolution?

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D. Are the civil society and other organizations truly separated from the governments’ actions and
policies? In what ways can the state maintain its sovereignty amid globalization?

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REFERENCE: Kennex, P. & Aldama, R. (2018). The contemporary world. Rex Book Store

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