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Question. Economic globalization refers to “the further internationalization of economic activity, in terms of greater interdependence and integration between economies and economic activity”(Thompson, 200,pg92).

To what extent is the traditionalist interpretation of this description convincing?

This essay sets out to evaluate the traditionalist’s theory on globalization with reference to the area of economic trades and interdependence between Nations.

2 main terms need to be explained before we can begin to evaluate the theory, that of globalization and the traditionalist views. Globalization is term much bandied about in the recent past but with no one being able to give a precise definition, however for us as social scientists four points of importance can be identified  

  1.Stretched social relations, the increasing of networks across the world, political views, cultures and economic action

2.Intensification of flows, increase in the amount of interaction and the feeling of effects farther away from the source

3.Interpenetration, the increase in the diversity caused by distant cultures meeting

4.Global infrastructure, institutions that would be needed for the global network to operate

So for the question of greater internationalization these markers can be measured and evidence gathered and presented. This essay will also look at the kind of evidence the traditionalists provide to back up their claim.

Traditionalist theory claims that globalization is not occurring at the rate claimed by the globalists, and that what we are seeing now is nothing particularly new. They also argue the continuing importance and authority of the nation state and national identity.

In the case of economic growth they see the current expansion as an extension of current systems, albeit with increased quantity, rather than a new global market emerging.

They claim that most trade is still regional and still under the control of the nation state. And that most trade is still between blocks of countries than truly global.

To evaluate a theory a set of criteria are used. They test the coherence, empirical adequacy and comprehensiveness of the argument. I will take these aspects one at a time and explore how well the traditionalist argument holds up.

  Coherence

  Is the traditionalist view coherent, is there logic in the argument and are there any hidden assumptions?

  The argument here seems a little incoherent; to mention the Asian crash as a worldwide devastating occurrence and then state that inter-dependence is a myth does not seem very valid. The traditionalists have admitted one of the key factors in favor of globalization (the intensification point) but downplay its importance. There are also many examples of other felt affects from other “jittery” economies The Globalist theory seems to be more strengthened by this point.

 The traditionalists claim that what we are seeing is nothing radically new that is a sweeping claim and something of a vague one. They admit an increase in the amount of trade and multinational corporations, however they deny the existence of true transnational corporations, this sees to prove a growing rationalization if not outright globalization (which would strengthen the Transformationalist view of change occurring but slower than the globalists claim)

In terms of the hidden assumptions, the traditionalist view assumes that the power of the nation state is sufficient to “rein in” the large corporations and their activities?

The definition of globalization is also in debate, could the definition given by the traditionalists have been chosen, as it was the parts they could easily argue their point from. No one can deny the increase of trade and money flow but there is a vast array of evidence that can prove any theory, was this definition chose for the simplicity of evidence needed to convince the public of the view?

  Empirical Adequacy

As with any theory they produce evidence to support their claim and by evaluating that evidence. No evidence however can be called “complete” and it is worth bearing in mind that the other theories also have supporting evidence that will be just as convincing.

The evidence put forward by the traditionalists is convincing, by using the trade to GDP (gross domestic product) ratio they claim that there has been no significant increase in the

Worldwide export market (table 3.1 page 97)

Even with the accounting for inflation in the data (table 3.2) the evidence suggests a higher rate than the basic ratio but still nothing like the amount put foreword by the globalists. The last set of data given takes into account the debate on the unit of the GDP.

What this involves is more complex than first apparent, it takes into account ALL trade,

Whereas critics state that some areas of trade expand faster than others and this should be taken into account. With this taken into account the evidence suggests more of an increase in trade and therefore more openness in the markets

One set of evidence used is the trade data from the Triad (U.S.A, Europe and Japan)

These tree main trade blocks of the word keep records of trade between themselves, each other and the rest of the world. The evidence here shows that whilst trade between the blocks occurs the bulk of trade is still from inter block countries (showing regionalization as opposed to globalization) Further evidence to refute the globalists claim comes from the statistics for the north south global divide (fig 3.9) this shows a market trade from the industrialized northern hemisphere to the less industrialized south still at low levels. Increasing somewhat with the rise in manufacturing markets in the south. (Although the loss of jobs this appears to have caused in the north can be stated as evidence of interdependence from the Globalist point of view)

As has been shown the amount of manipulation one can put a set of figures through is quite astounding, that is the point to remember with evidence. No set of data will ever be totally comprehensive. However as the data stands here it does show that there is no more globalization now than there was pre World War 1.

One of the other main points of contention of the traditionalist/Globalist theories is the power of the nation state The traditionalists claim that the nation state still holds the most power and that even the large multinational corporations (MNC) are held in check by government

How true that is open to debate as the big corporations have a lot of political power even if they do not directly contribute i.e. Microsoft in the U.S.A., the old government ordered and action that would have split Microsoft into 2 parts (an undesirable act for the company) How much power was exercised to get that decree overturned by the new government, and whilst not a MNC the power of the Gun lobby in the U.S.A is undeniable. In the UK more control seems to be able to be exercised by Whitehall, even to the point of making decisions unpopular with big business i.e. the ban on tobacco advertising in formula 1

So the evidence put foreword seems to substantiate the claims made by traditionalists that trade now is no more truly global than it was (the volume has increased but no new order) and that the power of the nation state is till paramount

  Comprehensiveness

  How comprehensive is the argument, does it hold true in all cases and how many factors are taken into account?

Here the argument seems to be reasonably comprehensive; it takes into account a wide variety of factors, the inflation in the GDP etc.

There is also a large amount of evidence not taken into account, the tourism industry and global banking for instance, what effect would the inclusion of this data have on the validity of the theory? The more factors this evidence takes into account the higher the perceived level of interdependence can be shown.

However no argument will ever hold true in all cases and it would be foolish to take evidence as irrefutable, for each point made both the globalists and the Transformationalist have a counterpoint.

Globalists would argue the incompleteness of the accounting trade factors. Citing information technology and banking as key missing factors

Transformationalist would cite the time span of the data, most of the data for recent flows is not yet available (the latest evidence given is for the late 1990’s) can this truly show today’s world?

In conclusion to the question of to what extent is the traditionalist theory convincing.

I would have to say, not terribly. The evidence given is convincing as far as it goes but the distinction they make between regionalization and globalization seems a little weak. Using that to refute globalization does not stand up for me. In this instance the Transformationalist view of a changing world holds up more (the total new order proposed by the globalists is just as unconvincing here)

 The insistence on the power of the nation state as still absolute also does not hold, even in the UK we feel the influence of the EU and the effects of Scottish independence, although the state still holds more power than the globalists claim i.e. independent tax rates and interest rates.

The claim that globalization is uneven is held up by the divide in trade between the rich (industrialized) world and the poor (non industrialized) world. The gap between the rich and poor is growing, along with the gap between those who have the technology to take advantage of this new way and those who do not.

I would have to say that we are living in a globalizing world. Not as global an economy as the globalists claim but more integrated than the traditionalists want to admit.