Assignment Number 3

Submitted by:
FARWA TEHREEM
Roll No:
BBA 07183038
Class:
BBA 8TH
Submit to:
Mr. Wasif Hanif
Subject:
Globalization and Outsourcing
Due Date:
06.06.2022
Department:
Management Science

The University of Lahore |Sargodha Campus

 Assignment 2

Introduction

We had lived in a world of essentially unchallenged sovereignty for several generations now, and had
begun to think of it as the natural state of affairs. However, the idea of states as autonomous,
independent entities is collapsing under the combined onslaught of monetary unions, global television,
the Internet, governmental and non-governmental organizations. Globalization has become a favorite
catchphrase of everyone; journalists, economists, politicians, environmentalists, lawyers, and even
farmers. This is associated with ‘globalization’ being a truly multifaceted phenomenon, with implications
that encompass not just the economic but also the social, political, cultural and geographical.

Perspectives of Globalization

As noted earlier, globalization is the term used to describe one of the most contemporary phenomena
of our time; involving the diffusion of ideas, practices and technologies through the various now
available means of communication and interraction. It has led to internationalization of most issues in
human and state existence. It is not merely liberalization of markets, though in many cases that has
been the result.

The definition by Anthony Giddens19 aptly describes this phenomenon: “the intensification of
worldwide social relations which link distant localities in such a way that local happenings are shaped by
events occurring many miles away and vice versa”. This involves a change in the way we understand
geography and experience localness. As well as offering opportunity, it brings with it considerable risks
linked, for example, to technological change. Globalization, thus, has powerful economic, political,
cultural and social implications for sovereignty.

Globalization and Political Sovereignty

Globalization has led to a decline in the power of national governments to direct and influence their
economies (especially with regard to macroeconomic management); and to determine their political
structures. There is a strong indication that the impact of globalization is most felt through the extent to
which politics everywhere are now essentially market-driven. It is not that governments are now unable
to run their states, but to survive in office; they must increasingly “manage” national politics in such a
way as to adapt them to the pressures of trans-national market forces.

The institutionalization of international political structures has led to political globalization. Since the
early nineteenth century, the European interstate system has been developing both an increasingly
consensual international normative order and a set of international political structures that regulate all
sorts of interaction. This phenomenon has been termed “global governance” by Craig Murphy20. It
refers to the growth of both specialized and general international organizations.

Globalization and Economic Sovereignty

The interrelationships of markets, finance, goods and services, and the networks created by
transnational corporations are the most important manifestations of economic globalization. Though
the capitalist world-system has been international in essence for centuries, the extent and degree of
trade and investment globalization has increased greatly in recent decades. Economic globalization has
been accelerated by what information technology has done to the movement of money. It is commonly
claimed that the market’s ability to shift money from one part of the globe to another by the push of a
button has changed the rules of policy-making, putting economic decisions much more at the mercy of
market forces than before. According to Karky, economic globalization is a historical process; the result
of human innovation and technological progress. It refers to the increasing integration of economies
around the world, particularly through trade and financial flows.22 Now, shifts in economic activity in
say, Japan or the United States, are felt in countries all over the globe. The internationalization of
financial markets, of technology and of some manufacturing and services bring with them a new set of
limitations upon the freedom of action of nation states. In addition, the emergence of institutions such
as the World Bank, and the International Monetary Fund, involve new constraints and imperatives.

Sovereignty in a Globalized World

Technological changes over the last 200 years have increased the flow of people, goods, capital, and
ideas. The response of states to globalization and its impact on their sovereignty is nothing compared
with what followed the invention of the printing press. Most sovereign monarchs could not contain the
spread of the concepts that spread with it and many lost not only their kingdoms but also their heads.
Despite the perceived impacts of globalization on sovereignty of states, states appear to be stronger and
more able to address internal problems and no leader has lost its state yet to globalization.

In addition to attempting to control the flows of capital and ideas, states have long struggled to manage
the impact of international trade. The opening of long distance trade for bulk commodities in the 19 th
century created fundamental cleavages in all of the major states. One thing is certain; globalization is
changing the scope of state control. The reach of the state has increased in some areas and contracted
in others. Rulers have recognized that walking away from issues they cannot resolve can enhance their
effective control. For instance, beginning with the Peace of Westphalia, leaders chose to surrender their
control over religion because it proved too volatile. Keeping religion within the scope of state authority
undermined, rather than strengthened, political stability.

Along with the erosion of national currencies, we now see the erosion of national citizenship – the
notion that an individual should be a citizen of one and only one country, and that the state has
exclusive claims to that person’s loyalty. For many states, there is no longer a sharp distinction between
citizens and noncitizens. Permanent residents, guest workers, refugees, and undocumented immigrants
are entitled to some bundle of rights even if they cannot vote. The ease of travel and the desire of many
countries to attract either capital or skilled workers

Have increased incentives to make citizenship more flexible. Treaty is one of the sources of international
obligation. It is a basic norm of law that one cannot derive rights and liabilities from a treaty to which he
is not party. However, contemporary international law now envisages situations where rights and
liabilities are created for states without their being party to such transaction. There are treaties that are
assimilable to international executive act And treaties assimilable to international legislative acts, such
as treaties that create objective legal situations like neutralization, demilitarization, internationalization
of human rights and conventions codifying existing norms of customary international law.
Transnational Non-governmental Organizations (NGOs) have much influence over state activities.
Throughout the 19th century, there were transnational movements to abolish slavery, promote the rights
of women, and improve conditions for workers. The number of transnational NGOs, however, has grown
tremendously, from around 200 in 1909 to over 17,000 today.28 The availability of inexpensive and very
fast communications technology has made it easier for such groups to organize and make an impact on
public policy and international law. Such groups prompt questions about sovereignty because they
appear to threaten the integrity of domestic decision-making. Activists who lose on their home territory
Can pressure foreign governments, which may in turn influence decision makers in the activists’ own
nation.

Conclusion

Globalization is often seen in terms of impersonal forces wreaking havoc on the lives of ordinary and
defenceless people and communities. It is not coincidental that interest in globalization over the last two
decades has been accompanied by an upsurge in what has come to be known as New Social Movements
(NSM).34 NSM theorists, despite their substantial differences, argue that the traditional response of the
labour movement to global capitalism, based on class politics, has generally failed, and that a new
analysis based on identity politics (of gender, sexuality, ethnicity, age, community, belief systems) has
taken over. Today, more or less every specialism in the social sciences has its ‘globalization’ perspective;
for example, globalization of law,35 social welfare, crime36, labour37 and politics. Among the most
important substantive issues, widely discussed by globalization researchers inside and outside the four
approaches outlined above, are global environmental change and gender and globalization.

The main challenge to global capitalism in the economic sphere is the argument that the rich countries
‘think global and act local’. It is particularly the rich countries and few advanced developing countries
that are able to harness the benefits of global economy. Poor countries are not able to get and as a
result, the gaps between the rich and poor countries, and rich and poor people within countries have
grown.

An important part of economic globalization today is the increasing dispersal of the manufacturing
process into many discrete phases carried out in many different places. Being no longer so dependent
on the production of one factory and one workforce gives capital a distinct advantage, particularly
against the strike weapon which once gave tremendous negative power to the working class. Global
production chains can be disrupted by strategically planned stoppages, but these generally act more as
inconveniences than as real weapons of labour against capital. The international division of labour and
its corollary, the globalization of production, build flexibility into the system so that not only can capital
migrate anywhere in the world to find the cheapest reliable productive sources of labour but also few
workforces cannot any longer decisively ‘hold capital to ransom’ by withdrawing their labour.

The issue of democracy is central to the advance of the forces of globalization and the practices and the
prospects of social movements that oppose them, both local and global. The rule of law, freedom of
association and expression, freely contested elections, as minimum conditions, however imperfectly
sustained, are as necessary in the long run for mass market based global consumerist capitalism as they
are for alternative social systems.

The most significant impact of globalization on sovereignty of states is that it has altered the scope of
state authority and control rather than to generate some
Fundamentally new way to organize life. Yet, the reduction of state authority and control was not done
out of coercion but is rather a reduction in power free will. This freedom to decide what to do with state
power is itself a product of sovereignty of states.

In conclusion, even though it can be shown that globalization has reduced certain state powers, it is still
within the sovereign power of a state to decide not to be part of the integrated global life. It is a choice a
nation makes in exercise of its sovereign powers. The central challenge however is to ensure that
globalization becomes a positive force for the entire world’s people. While globalization offers great
opportunities, at present its benefits are very unevenly shared, while its costs are unevenly distributed.