AN INTRODUCTION TO GLOBALIZATION

What’s Globalization
- One of the most contested topics in the social sciences
- Observers and theorists of globalization have variously argued that the rapid increase in
cross-border economic, social, technological, and cultural exchange is civilizing, destructive or
feeble.

Globalization core concepts

- Internationalization: intensification of cross-border interactions and interdependence between
countries
- Liberalization: The process of removal of restrictions imposed by governments on movements
between countries in order to create an “open” and “integrated” world economy
- Universalization: Spreading of products, objects and experiences to all the corners of the earth
- Westernization: Some (especially critics of cultural imperialism) have defined globalization as a
progressive process of cultural transformation of the planet towards Western-based cultural
patterns
- Deterritorialization: The radical change in geography whereby places, distances and territorial
borders lose a large part of their value and influence

Globalization’s main debated

1. Is globalization really a new phenomenon or does it come from long ago?
2. Does globalization help or harm us? Who does it help and who does it harm?
3. Is this phenomenon basically economic, cultural or political?
4. Is globalisation a process or a project?
5. Does globalization spell the end of nation-states.. Or just the opposite?

Few questions and issues:

- Time and space?
- Driven by production and/or technology?
- Interdependencies and consciousness?
- Deterritorialization and supra-terrotriality?
- Culture in the making?
- Global institutions?
- Homogenization?
- Inequality?
- Idology?
- Control, power, surveillance?

Globalization ideologies

Market globalism
- Liberalization of markets
- Globalization is inevitable
- Nobody is in charge of globalization
- It benefits everyone
- Globalization spreads democracy
Authoritarian globalism
- Countering the anto-state and deregulated Western model
- Recovery of state control
- Withdrawal from international commitments
- Social stability
- Rule of law is not democracy
- Relativism Realpolitik

Anti-globalization
- For external influences
- Against sovereignty transfers
- Against globalization
- Relies on some kind of emotional populism
- Protectionist on trade, identity, migration

Justice globalism
- A global Marshall Plan
- The Tobin Tax
- Abolition of offshore financial centers
- Implementation of stringent environmental agreements
- A more equitable global development agenda
- A new World DEvelopment Institution managed by the south
- Reform wto to implement higher international labour standards
- Introduce greater transparency and accountability in governments and IOs
- Make globalization gender sensitive
The backlash to Globalization
- It allows rich and powerful outside business interests to intrude into a local culture, overrides local
traditions, and threatens a way of life
- In more traditional societies, globalization threatens the cultural and religious underpinnings of
society. In both industrialized and developing countries, many people feel threatened by the
globalization process
- A globalized economy presents a myriad of challenges, from protecting local cultures to
protecting the environment, to protecting local jobs… and the faster (than ever) spread of viruses
(of different sorts).

The tip of the iceberg

Reading Harari: Lessons from a year of Covid

“If covid-19 nevertheless continues to spread in 2021 and kill millions, or if an even more deadly
pandemic hits humankind in 2030, this will be neither an uncontrollable natural calamity nor a punishment
from God. It will be a human failure - more precisely - a political failure.”

1. “2020 has shown that humanity is far from helpless”

- Global production
- Cross-sector funding
- Within less of a year several effective vaccines were in mass production
2. The power of information technology: automation and the internet made extended lockdowns
viable, at least in developed countries (enter inequality)
- Education gap
- Gender gap

3. We inhabit two worlds - the physical and the virtual (although with considerable gaps and
disparities)

4. The delivery people were the thin line holding civilisation together (not everything can be
digitalised, and the crucial importance of many low-paid professions)

5. New forms of nationalism, protectionism, new (un)valuable assets: New kind of global inequality?
(vaccine nationalism)
- Rich countries will get access to coronavirus vaccines earlier than others
SOCIO-CULTURAL DIMENSION OF GLOBALIZATION I

Expulsions
- When we discuss the rising inequality, poverty, imprisonment, foreclosed homes and other
injustices, simply engaging in familiar discussions about these increases in disparities does not
capture the larger reality we must face
- We need new language
- Use the term “expulsions” to mark the radicalness of that necessary shift

Feminist approaches to globalization

1. This is an umbrella term

2. We focus in particular on postcolonial, transnational and ethics of care feminists

3. A common feature is that “even apparently gender-neutral global issues often have a gendered
dimension, including war, global governance, migration, southern debt, the “resource curse”, and
climate change “

4. Tend to understand the outcomes of globalization not as disparate or contingent phenomena, but
rather as a result of systematic, structural injustices on a global scale. Indeed some contend that
the global basic structure itself is implicitly biased against women

INTERSECTIONALITY
- Is the concept that all oppression is linked
- The interconnected nature of social categorisations such as race, class and gender, regarded as
creating overlapping and interdependent systems of dicrimination or disadvantage
- It is the acknowledgement that everyone has their own unique experiences of dicrimination and
oppression and we must consider everything and anything that can marginalise people - gender,
race, class, sexual orientation, physical ability etc.
- The core of intersectionality then is coming to appreciate that all women (but also other
marginalised groups) do not share the same levels of discrimination just because they are women

Intersectionality and globalization

- Femon ist theories of globalization contend that gender oppression interacts with other systems
of oppression, along with other forms of systematic disadvantage that arise within the global
context
- Salient categories include:
- Nationality
- Geographical location
- Citizenship status
- Socioeconomic position within the global economy (ex: southern elite, westen labourer,
worker on an assembly line)

- Given this broad conception of intersectionality, feminist theorists of globalization insist that
gender injusticies arise within specific transnational contexts, such as historical relationships
among nations and current global economic policies
Globalization & economic justice
- For some of the lowest wages of the world, millions of people, most of them girls and women, are
exposed every day to an unsafe work environment with a high incidence of work-related
accidents and deaths, as well as occupational diseases
- Most of the factories do not meet standards required by building and construction legislation
- As a result, deaths from fire incidents and building collapses are frequent

From “FEMINIST PERSPECTIVES ON GLOBALIZATION”

- Proponents of globalization argue that the expansion of export processing has had positive
consequences for women, providing jobs for thousands of otherwise unemployed women and
offering new forms of agency
- However, feminist political philosophers argue that jobs on the global assembly line tend to be
difficult, insecure, and dangerous: working conditions are poor, hours are long, wages are low,
and sexual harassement is widespread

Ethics of care & Globalization

- The starting point is that most mainstream analyses of globalization ignore or devalue care

- Why is this problematic:

1. Care work, which is done almost exclusively by women, has been found profoundly
influenced by globalization
2. The values and work associated with care and both undervalued and insufficiently
supported, and this contributes to gender, racial, and economic inequality, both within
countries and between the global North and the global South

- CARE WORK IS DONE ALMOST EXCLUSIVELY BY WOMEN

Global care chains

- Link women across the world and are established through the transnational exchange of
domestic services.
- Typically begin when relatively well-off northern or wetsern women enter the paid labour force
and hire other women, usually poorer women from developing countries, to care for their children
and other dependents
- Migrant care workers often must leave their own children behind in their home countries to be
cared for by even poorer care workers or family members who may already have care-giving
responsibilities or be engaged with paid labour
BURDEN OF UNPAID CARE WORK
- Increases in poverty and unemployment in developing countries, placing additional burdens on
women within both the household and the public sphere
- Consequently, women have had to develop survival strategies for their families, often picking up
the caregiving labour that is no longer provided by the state
- Women also face intensified pressure to earn income outside the home. Some women who have
been unable to find adequate employment in their own countries have turned to labour migration
- Sex work, including child prostitution, has also increased under these conditions

Globalization & economic justice

- Neoliberal policies have created dramatic economic inequalities, both between the global North
and global South and within countries in both hemispheres
- In the global North, the pressure on companies to “outsource” jobs to countries where labour is
cheaper and working conditions are less regulated has meant many of the workers who once
relied on well-paying manufacturing jobs are now unable to make a living. These jobs have
largely been replaced by contingent and part-time service-sector jobs, which tend to be poorly
paid and lack health and retirement benefits.
- In the global south, foreign-owned manufacturing and assembly production facilities have
proliferated in free trade zones, forming what is often referred to as the “global assembly line”.
Historically, foreign-dominated industrial expansion has meant more jobs for men; however, it is
primarily women who comprise the new “international industrial proletariat” working on the global
assembly line

Postcolonial and decolonial feminism & Globalization

- Multinational corporations and global businesses, largely centered in Western nations, bring their
own colonizing influence through:
- Business models
- Hegemonic culture
- Exploitation of workers
- Displacement of traditional trades

- Whereas, traditional forms of colonialism entailed the colonizer assuming the privilege of ruling
the colony, this neocolonialism rules indirectly through the power it creates and enjoys by bringing
manufacturing jobs to an area or providing consumer goods to people - often Western inspired
consumer goods as well

- Old style colonialism often killed or displaced indegenous people; the new style of colonialism
impoverishes a culture by swamping society with Western values, products or ideals

Analyze globalization within the context of the history of Western colonialism and imperialism:
- They begin with the claim that Western colonialism and imperialism have played important roles
in shaping the contemporary world, and highlight their enduring effects in global relations and
local cultural practices
- They argue, neoliberal policies and institutions systematically favor countries in the global North
to the detriment of southern nations
- Also that global economic institutions also privilege Western culture and political norms.
Presenting them as models for the rest of the world, while ignoring and marginalizing the claims
of women’s and indegenous movements in the global South as well as settler nations
SOCIO-CULTURAL DIMENSION OF GLOBALIZATION II

Understanding social change

- Techno-economic (technical): what can be done?
- Cultural (values and ideas): What is good or accepted?
- Sociopolitical (structural and institutional): What do social norms and regulations say about it?

CULTURE
- A set of ways of thinking, feeling and acting that are shared by a society.
- They allow our cervical, and give a meaning to the members of a group
- “The glasses we use to understand the world, what we see and how we feel about it. They have a
cognitive and axiological function”
- Are we aware that we wear these glasses?
- Thus, they are socially constructed glasses

VALUES
“Our cultural values give meaning to the members of a given group (firm or society)”

Main functions of values:

- To orient our behaviour
- To motivate and guide our way of doing things
- To identify us as belonging to a group in relation to the rest
- And to provide a framework explaining the world and our role in it
IDENTITY
“The process whereby a social actor recognises himself and constructs meaning, above all by virtue of a
particular cultural attribute (or set of attributes) disregarding other social structures such as power, wealth
or status”

Culture of the globalized markets

- Main cultural elements embedded in the global market affect new values (brought by the market),
which in turn may lead to social change
- Traditional values:
- Solidarity
- Communal ownership of goods
- Alternative notions of happiness or of “good life”

What’s the impact of globalization on…

Market pre-eminence transform societies
- While entering in collision course with traditional cultures
- It modifies basic traits of western modernity too: human rights, democracy, welfare state

“The production of ‘human waste’ - or more precisely, wasted lives, the ‘superfluous’ populations of
migrants, refugees and other outcasts - is an inevitable outcome of modernization’

Some impacts and consequences

- Loss of control upon our own life
- Search for sense of belonging
- Construction of identities and (new) communities
- Inequality
- Lack of trust on (central) institutions
- Global feeling of disenfranchisement
- Emergence of far-right, alt-right, racist, exclusionary movements and parties
- Disintegration of class consciousness into group membership and lifestyles and consumption
patterns
- Reification of people who became products in the job market

ON THE POTENTIAL FOR SOCIAL CHANGE

Why is it so difficult?
- MACHIAVELLI’S WISDOM: “There is no more delicate matter to take in hand, nor more
dangerous to conduct, nor more doubtful in its success, than the creation of a new order. For the
initiator has the enmity of all who would profit by preservation of the old institutions and merely
lukewarm defenders in those who would gain by the new ones”

Enter power
- Sometimes quite visible (in the sense of wars - military action) - torturing bodies is less effective
than shaping minds
- Sometimes quite mundane (material devices)
- Sometimes less visible (categorization, blocking entrance to certain institutions)
- Sometimes (almost) non-visible (advertising, mass manipulation)

And yet, where there is power, there is resistance (anonymity and resistance)

Movements becoming global

- The Arab spring
- Global movement around climate change
- Black lives matter - globally
- #metoo - globally

How does it happen?

How do people decide, realize, think, become aware that ‘enough is enough’?
- Conscientization, awareness-building
 - Education
- Lack of hope, or on the contrary lots of hope
- New resources available - ex: social media, use of celebrities
- People (activists/intellectuals?) that are in between different societal spheres that bring different
viewpoints, perceptions

Often by (re)creating a community, and community is based on togetherness

- Which is fundamental psychological mechanism to overcome fear
- Overcoming fear is the fundamental threshold for individuals to engage in process of social
transformation
INNOVATION, TECHNOLOGY

Acceleration of innovation cycles

The Knowledge society (1996)

- The information technology revolution led to the introduction of informationalism as a material
foundation of the new society
- In informationalism, the generation of wealth (techno-economic sphere), the exercising of power
(socio political sphere) and the creation of cultural codes (sphere of culture and values) have
come to depend on the technological capacity of societies and people, information technology
being the core of this capacity

The new informational paradigm

- Information is the new raw material
- Information processing is key
- Production agents organize in globally interconnected networks
- Flexibility within cycles of adaptation and readaptation to means and ends
- Specific technologies converge into an integrated system
- These new information and communication technologies will penetrate our social life

Impact on labour trends

New international division of labour: developed, underdeveloped, emerging

Polarization in the “emerged” industrialized countries:

- End of social elevator
- Stagnant social mobility

Fracture in social cohesion

Social impact of globalization: vulnerability and exclusion:

The bright side of technology

- Technology as the result of the relationship of human beings with other human beings and with
nature in order to obtain services and products intended to meet human needs

The dark side of technology

- Contamination - disease
- Disasters
- Pollution

A PARADOX
- Modernity was supposed to bring about control, safety, prevention
- Role of science - provide security against natural disasters and harm on human life
- Role of the state - provide social security/assistance
- Second modernity: Globalization + technological progress - new hazards, dangers, risk,
uncertainty, insecurity
RISK SOCIETY
- “A situation in which we find ourselves permanently engaged by threats and dangers caused by
the process of modernisation itself”

Reassessing the role of technology

- On one side “control over nature” means wealth, prevention capacity
- On the other side, it creates “manufactured risks”: unintended (not natural) consequences of our
actions upon nature
- Implies a new definition of risk
- Risk (old notion) as the probability of an event to happen X magnitude of the harm
caused by it
- Assumption: it is possible to anticipate future risks… but is that possible anymore?

Advent of the 2nd modernity (Giddens & Beck)

Paradoxes of new contemporary risks:

- They are new
- They are manufactured uncertainties
- Quite often: risks impossible to verify / assess its impact

They imply a transfer of this risk:

- Across generations (environmental hazards)
- Across countries (toxic waste)
WHAT TO DO IN THIS SITUATION - 2 RESPONSES

1 - A NEW ETHICS FOR THE RISK OF SOCIETY

Principle of responsibility
- In space: “Act so that the effects of your action are compatible with the permanence of genuine
human life”
- Across time: “Thinking on future generations

Principle of precaution
- “Act preemptively even when there is no scientific evidence against potential hazards
- 2 associated problems:
- Reverted burden of proof
- Who should prove the risk?

2 - A RETURN TO POLITICS
- Giddens urges a return to politics: the assumption of a “democratic utopia”
- “Risks with far-reaching consequences show a utopia that nevertheless presents a very high
dose of realism. It is a utopia of universal cooperation, which recognizes unity in the diversity of
human beings. Evils show us what we should try to avoid: negative utopias. The difficulties of a
scientific and technological civilization cannot be solved only by introducing more science and
technology. It is necessary to deliberate, publicly and openly, on how social and environmental
restoration can be linked to the quest for positive life values... guiding us in autonomy, solidarity
and the search for happiness [for all].”

BIRTH OF THE KNOWLEDGE ECONOMY

- Information and knowledge
- Decentralisation and flexibility
- Corporate interconnection and synergies
- Intensive use of new technologies
- More interaction public-private sectors
- Sustainability
- Creativity and innovation

The new job profiles suitable to this new paradigm: EMPLOYEES…

- Oriented to the application of their knowledge
- Capable of integrating other specialized knowledge
- Capable of working in a team
- Capable to turn firms into intelligent organisations
- Capable to master the intellectual frameworks set up by other members of the informational
paradigm

A future that works:

- Automation
- Employment
- Productivity
CENTER FOR HUMANE TECHNOLOGY
Technological dimensions of globalization and the risk society

ECONOMIC SOCIOLOGY

3 main social processes

1. Power exists and modifies the behaviour of agents
2. Institutions (following Durkheim, understood as systems of collective beliefs, norms and
feelings)
3. Social networks: established patterns of behaviour, sanction behaviours, confer a sense of
belonging and identity and configure what sort of action is socially acceptable

Some thoughts and take-aways

- Our “worlds” (and markets are no exception) are not naturally “drawn and occurring - they are
often the result of political and cultural projects - particular interests are involved, often not
obvious

- They require and are made of social structures, beliefs, norms, “points of view”, institutions that:
- Stabilize relationships and hence inclusion/exclusion
- “Define” what is doable, what is right/wrong, natural/non-natural, who can play and how
the “game”

- They also provide materials for:

- Reproduction/maintenance of particular configurations
- Bt also for resistance, entrepreneuring and change

MARKETS AS POLITICS (Fligstein, 2001)

- Fligstein’s use of the “market as politics” metaphor has two dimensions:

1. Modern state with capitalist economies create the institutional conditions for markets to be stable
- The construction process of such institutions is a contested one
- Once in place, those institutions are keys to understand how new markets develop in a
society

2. Processes within a market reflect 2 types of political projects:

- The internal firm power struggle - who will control the organization, how it will be
organized, and how situations will be analyzed
- The power struggle across firms to control markets

- He identifies 2 main players: states and firms

THE DIFFERENT WAVES OF GLOBALIZATION (1870-2000)

Globalization and the creation of market institutions (XVII - XIX centuries)

Institutions need to run economic globalization smoothly:

- Property rules
- Courts to enforce contracts
- Trading regulations to protect exchanges
- A police force
- Macro-policy frameworks to correct the business cycle
- Prudential standards and supervision to maintain financial stability
- A lender-of last resort when in financial panic
- Health, safety, labour and environmental standards
- Compensation schemes to placate the losers
- Social insurance against market risks
- Taxes to finance all the previous functions

- With little exception, the following rules applies: the bigger the state , the larger the public setor is
- INSTITUTIONS ARE NEEDED

Main idea: INSTITUTIONS ARE NECESSARY

- More exposition to trade - more need for institutions:
- To make the market run
- To protect citizens from the market
THE FIRST ERA OF GLOBALIZATION (1800 -1914)

THE SECOND ERA OF GLOBALIZATION (1945 -)

3 phases of economic globalization:

1. 1945 - 1970: The Bretton Woods consensus
2. 1980 - 2000” The Washingnton consensus
3. XXIst Century: A disoriented globalization
 - The UN is born (1945)

- The Bretton Woods framework (1944)

- IMF
- WORLD BANK
- General agreement on tariffs and world trade (1995: WTO)

A - 1945-1970: Bretton Woods - a globalization with room for domestic policies, a globalization
respectful with national differences

- Trade liberalization + plenty of space for governments to respond to social and economic needs
- It was a moderate globalization
- Domestic policies >> international agreements

- It created the IMF, WB, GATT (General agreement on tariffs and trade)
- Rule of enforcement through IOs
- Since it was created by a multilateral initiative

- GATT rounds:
- Expansion of the most-favoured nation clause
- Progress of all areas (but agriculture, banking or utilities)
- GATT rules: limited, weak and unenforceable
- The GATT (1947) was the outcome of the failure of negotiating governments to create the
International Trade Organization (ITO)

- Generated growth equity, security and sustainability

- Allowed room for different types of capitalism: Anglo-saxon

1970’s: A decade of turmoil

- Yom Kippur war
- Oil crisis
- Vietnam
- Economic crisis in the west
- Inflation, unemployment...

1990s: WELCOME TO NEOLIBERALISM

B - The Washington Consensus (1990)

- Economic globalization becomes an end in itself
- Domestic economic management << international trade and finance
- ONE RECIPE FOR ALL
- Low corporate taxation
- Tight fiscal policy
- Deregulation
- Remove power from trade unions
 - With the birth of the wto (1995) the door is open for hyperglobalization
- MNCs demand international rules - a call for harmonization
- Goes beyond GATT agreements on agriculture, IP and patents and other services, tax
systems, food and safety rules, environmental regulations, industrial promotion policies

- The WTO dispute settlements become compulsory and binding:

- To avoid protectionism
- To avoid the domestic policies fall prey of lobbies

THE GOVERNMENT IS THE PROBLEM

10 main points on:

- Fiscal discipline
- Public spending priorities should change
- Tax reform
- Interest rates
- Exchange rates
- Trade liberalization
- Foreign direct investment
- Privatization
- Deregulation
- Property rights
ECONOMIC AND FINANCIAL GLOBALIZATION

Financialization
- A process whereby financial markets, financial institutions and financial elites gain greater
influence over economic policy and economic outcomes
- It transforms the functioning of economic system at both the macro and the micro levels
- Some of its central elements are: de-regulation, privatization, tax-havens, derivatives

Some basic concepts:

- Information is now the most valuable product in the global economy
- The driving force behind this economy is freely moving capital, beyond the control of
governments
- This is hot money: not intended to buy or sell goods or services
- Power shifting has a huge destabilizing potential

Principal impacts of financialisation:

- To elevate the significance of the financial sector relative to the real economy
- To transform income from the real economy to the financial sector
- To increase income inequality and contribute to wage stagnation

What is the financial sector?

- It consists of companies engaged in financial intermediation, amongst which we also find trade
finance, savings and housing institutions, leasing companies and insurance companies

Financial markets are not that perfect after all - “Greenspan concedes error on regulation”

Financialization works through 3 conduits:

- Changes in the structure and operation of financial markets
 - Changes in the behaviour of non-financial corporations (which mimic the behavioural patterns of
the financial sector
- Changes in economic policy

Financialization - causes and consequences

- Financial markets began attracting global money by such quick and high profits
- Financial markets start performing purely speculative operations and getting further and further
away from the creation of productive businesses, the production of goods and services and job
creation

“ Who was going to dedicate all their resources to this, when they could make much more money in
financial investment?”

- This process transforms the production model, they type of activities in which companies are
involved independently of the sector, and the system of remunerations
- Increases appetite for risk and increases global economic instability

1. The historical difference in returns between equity and fixed income

2. Growth of institutional investment
3. With the increasing life expectancy of developed countries, private pension funds are gaining
importance
4. Equity is shifting increasingly towards emerging markets
5. Cultural issues:
- Rise of Herd investment
- Expansion of the “elitist” culture of financial markets

How Herd investment works

Rise of an elitist culture:

THE CASE OF WALL STREET:

- Come from top university in the US Ivy League
- Diverse racially and gender but only on the bottom
- Message to the markets: “we recruit the best and the brightest, so we are the best”
- No experience is needed nor the financial smartest people

SOME FEATURES AND SOCIAL IMPACT:

- Acute job insecurity yet high pay
- Bonus is linked to the number of operations closed, not the long-term prospect of returns
- These set of practices are extended first to the rest of the financial sector (commercial banks,
insurance) and then to the rest of the sectors in the economy
- Problem: how to dismantle a whole culture with its values, ways of doing things, frameworks of
interpretation, tools and rewards?

CONCLUSIONS
- Running into permanent account deficit implies reaching out to external finance
- Hyperglobalization brings about the liberalization of the capital markets and the financialization of
the global economy and the capital markets
- With the rise of global financial markets a new and powerful elite exerts its influence upon
governments, institutions and companies
- The hypertrophy of financial markets transforms economies, how companies run, and the cultural
frame of societies
A SUMMARY OF THEIR IMPACT
- Strengthening of the financial economy, to the detriment of the real economy
- Increase in financial speculation
- Increase in global financial opacity and systemic risk
- Increase in the vulnerability of public budgets
- Increase in the procyclical tendency of countries’ economies
ECONOMIC AND FINANCIAL GLOBALIZATION

Augmented power of corporations all over?

At a global scale - Corporate gigantism

- Rise of importance of large MNCs in the global economy
- The “race to the bottom”
- Rise of offshore territories

Who has power? Government or corporations?

Concentration of corporate power

Consequence: The vertical and horizontal integration of firms limits free choice for customers (as required
by economic liberalism)
COVID-19, digitalization and market concentration

Too big to fail financial institutions?

“Too big to fail” describes a business or business sector deemed to be so deeply ingrained in a financial
system or economy that its failure would be disastrous to the economy. Therefore, the government will
consider bailing out the business or even an entire sector - such as Wall Street banks or U.S carmakers -
to prevent economic disaster.

- The most vivid example is the bailout of Wall street banks and other financial institutions during
the global financial crisis
- Following the collapse of Lehman Brothers, congress passed the Emergency Economic
Stabilization Act (EESA) in October 2008: It included the $700 billion Troubled Asset Relief
Program (TARP), which authorized the government to purchase distressed assets to stabilize the
financial system
- This ultimately meant that the government was bailing out big banks and insurance companies
because they were “too big to fail” meaning their failure could lead to a collapse of the financial
system and the economy. They later faced additional regulations under the Dodd-Frank Wall
Street Reform and Consumer

Race to the bottom

- The race to the bottom when it comes to corporate income taxation. With the goal of stimulating
economic growth, a large number of countries have reduced corporate income taxes significantly
- Can there be progress in terms of the SDGs - where collective action is crucial, and provision of
public goods indispensable - without a strong engagement of the part of the government?
- And how would that be possible without the required fiscal capacity?
THE BIRTH OF NEW DISCIPLINES: MANAGEMENT STUDIES

The professional executive

- Unrelated to the shareholder or owner of the firm
- Aim of management sciences: be able to anticipate her/his behaviour, to make it foreseeable
- To anticipate his/her behaviour with market requirements (shareholders, governments, banks..)
- (Some) key terms: efficiency, productivity, innovation, planning

Management born as functional discipline mirroring economic theory

Some basic ideas that come from economic theory:

- Smith’s notion of the invisible hand of the market
- The perception of the individual as an homo economicus
- The efficient market theory
- Agency theory
- A de facto code of ethics for managers whereby their only social responsibility is to help maximise
shareholder value: “The social responsibility of business is to increase its profits”

And its expansion well beyond corporate world:

- Expansion of management principles to other manageable areas such as education, health,
public governance

- It is represented as a “succesful” or the best way to run an organisation (with management

theories, tools, patterns of behaviour):
- Expanding from big TNCs to the smaller ones
- Includes/expands a rationale on how to take decisions
- And a vocabulary, some values, and global frameworks that explain how the economy is
perceived to work

Birth of management studies

Some core elements:

1. An economic discipline of American origin
2. Highly related to market pressures
3. Mass media and consultancy firms will seek new “recipes” for good corporate management +
techniques to reduce the anxiety of running a business in uncertain environments

Rise of functionalism in management

A functional discipline
- Management as the service of the interest of shareholders
- But with no other ethical code that capable to generate:
- Admiration and social respect
- Patterns of good behaviour that may surface its social contribution
- Other than serving the interests and wishe of shareholders
Management in its historical context
- AIM: to provide loyal administrators to new forms being formed with foreign capital
- A new discipline is born
- Management at the service of markets and big companies with a weak academic status:
- Seeking academic recognition
- Mirrors in economics

Mirroring economies

Elements from Economics

1. The preference for the abstraction of its underlying assumptions - the functioning of the market
and the individual
2. The use of mathematics as a method for calculation and abstraction
3. Lack of modesty in the face of somewhat scanty predictive capabilities

Elements from neoclassical economics:

1. Some theoretical assumptions
2. Disregard of social expectations

Main aim of management as a discipline:

- Management science was to merge with dominant ideology in order to respond functionally to
what was expected of it

ELEMENTS OF NEOLIBERAL ORIGINS

- Smith’s notion of the invisible hand of the market
- The perception of the individual as a homo economicus
- The shareholder value theory
- The efficient market theory
- Agency theory
- A de facto code of ethics for managers whereby their only social responsibility is to help maximise
shareholder value

Consequences for big companies:

- Big business increasingly locked within itself, its objectives and its interests
- Alongside a state progressively weekend in its regulatory and corrective capacity
- The rise of lean (tending towards the outsourcing of superfluous services) and mean (socially
autistic) organisations: increasingly identified as huge bureaucratic networks that seek rents and
profits and externalise the costs

SOME CORE FEATURES OF MANAGEMENT AS A DISCIPLINE

- Functional and submissive surrender to the forces of the market
- With no aspiration to transform the world, just attempting to solve technical problems
- With no reflection to its actual contribution to developing a better world
- A management discipline detached from the social impact of its theories
- Self-perceived as an amoral “science”
 - Forgets its historical nature (management has never ceased to evolve with new theories, gurus,
frameworks, metrics)

1 - FUNCTIONALISM
- Simplicity, narrow-mindedness
- Critical thinking
- Utilitarian, pragmatism, positivism
- Based on “absurd” theories of rationality
- Isolated from the rest of the social sciences
- Happy to work with anecdotal evidence
- Cooking recipes for managers… to be swallowed with case studies

2 - The economics of management: the quest for the status of science and mirroring economics as a
science (rationalization and mathematisation)

Is functionalism enough?
- Values are always present in business decisions
- They normally appear camouflaged in business theories
- There are no management theories that are free of (“amoral”) regulatory burdens
- It is up to us to act like robots (as long as we remember that we are not robots)

Downfall of managerialism
- Replaced by the ideology of shareholder primacy
- That erodes the authority of managers
- Increase in the external signs of success as a measure of the manager’s quality
- Rise in the popularity of quantitative methods for measuring a manager’s actions

PERFORMATIVITY IN SOCIAL SCIENCES

- A world tailored to the selfish and socially autistic individuals who the discipline describes in the
Homo economicus model. An executive reduced to the stereotype of Gorden Gekko, who was
guided by a single moral maxim: “Greed is good”

Social demand for more corporate accountability

- Rise of importance of corporate intangibles
- New mechanisms to capture and retain talent are needed
- Bigger exposure to boycotts
- Corporate contribution to the common good needs to be made explicit
- And companies become interested in both public and printed option

PERFORMATIVITY
- The power of language to effect change in the world: language does not simply describe the
world but may instead (or also) function as a form of social action
- In the late 1990s , anthropologists and other scholars studying economics began to consider
economic performativity, or how the practices of economists and other financial experts are not
simply descriptive of their subject but also serve to shape it
NEW PUBLIC MANAGEMENT
- It is viewed as a modern approach of management in public sector as a reaction toward the
insufficiencies of traditional public administration approach
- Public sector organizations seen as unproductive, inefficient, always suffer loss, low quality, poor
innovation and creativity

Management and the public sector

The objectives are:

- Improve efficiency and effectiveness in public sector organizations
- Improve responsiveness to stakeholders
- Improve quality of public services
- Improve accountability and performance

Marketization of education - trend towards marketization of education

CORPORATE SOCIAL RESPONSIBILITY
- Voluntary integration by companies of the social and environmental concerns in their commercial
operations and their relations with their stakeholders

How CSR usually starts:

1. Mandatory - threat approach: legality at global level
2. Reactive - risk approach: to respond and adapt
3. Proactive - opportunity approach: private movements, products and services

- Management theories impact on the way that businesses are run

- We cannot rely on markets or governments to fix what is wrong about the systems
- Companies can (ought to?) make the difference
- CSR is one of the ways to tackle and manage the impact of corporations in the societies where
they operate

EXTRA - SCHOOLS
- In the 1960s, sociologists of education used to talk about the idea of the “hidden curriculum”.
Because schools didn’t teach about women, people of colour, working class experience, they
effectively sent the message that it was only white middle-class men’s knowledge that really
mattered. What they didn’t teach was a lesson too. That’s changed now, but the hidden
curriculum of the business school remains any form of business that isn’t the capitalist
corporation.

Do business schools teach politics without admitting it?

- Do they engage with the challenges of a low-carbon economy, of the shorter supply chains that
we need to encourage localisation, and the need to address social justice and inclusion. Do they
teach about co-operatives, mutuals, local money, community shares or social enterprises? About
intentional communities, recuperated factories, works councils or the social economy? Ideas
about degrowth, the beauty of small, worker decision making and the circular economy are
absent. It’s as if there is no alternative.

Shouldn’t management serve societies?

CARE AND CARING
- In the midst of the world-wide Covid-19 pandemic, we have been tragically reminded of just how
vital robust care services are, whilst different forms of taking care - from mutual aid to social
distancing and self-isolation - have become the new normal

- CARE is our individual and common ability to provide the political, social, material and emotional
conditions that allow the vast majority of people and living creatures on this planet to thrive-along
with the planet itself

The values of caring:

- Attentiveness
- Responsibility
- Nurturance
- Compassion
- Meeting others needs

- These values have traditionally been associated with women and traditionally excluded from
public consideration

How to place care front and center on every scale of social life?
- We just first recognise our mutual interdependencies and the intrinsic values of all living creatures
- It is necessary to recognize our needs both to give and receive care

Building a caring infrastructure

- Organizations
- Communities
- Societies
POLITICAL ACTORS AND GLOBALIZATION

Nation-state and international order at the end of the 20th century

New players:
- Transnational NGOs
- TNCs
- IOs
- Regional associations

“Globalization should be visualized as a network, not as a hierarchy”

Elements of the nation state crisis

1. The existential breakdown of rich countries during the assault on national political power by global
forces
2. The volatility of the poorest countries and regions, now that the departure of cold-war era
strongmen has revealed their true fragility
3. The increasingly perceived illegitimacy of an “international order” that has never aspired to any
kind of “society of nations” governed by the rule of law

Pressures upon the state from:

- Banks and other financial groups
- NGOs
- Ethic or religious groups
- Dissident and non-conformist groups
- Pension funds
- Companies

Political trends of the late 20th century

EXPANSION OF INTERNATIONAL ORGANIZATIONS (IOs)

- The EU is the most institutionalized IO in history
- NATO is the strongest and most enduring security alliance in history
- The WTO is the biggest IO in terms of regulating and controlling major transactions
- The IMF and the world bank

There is no globalization without transfer of sovereignty

Environmental issues and sovereignty

- Sovereignty over natural resources implies the right of a state to protect, but also to pollute or
even to destroy environment on its own territory
- If sovereignty is (traditionally) defined as affirming the independence of states in deciding about
their own affairs. It seems obvious environmental issues do not respect national boundaries
 - However, this right ends where environmental degradation is no longer restricted to the national
territory and activities within one state’s jurisdiction adversely affects conditions in another state.
Thus, environmental issues pose new challenges for state

CRISIS OF THE NATION-STATE IN THE 21ST CENTURY

“The nation-state is becoming too small for the big problems of life, and too big for the small problems of
life.”

Crisis of the nation state

1. The internal rules of states are losing primacy to other standards
2. Many modern nation states are already ineffective at defending their own borders
3. New transnational threats - climate change, international terrorism, the proliferation of weapons of
mass destruction, speculative capital flows - highlight the ineffectiveness of the state
4. The advance of global capitalism reduces the capacity of states to manage their economies
nationally
5. Global communication networks render cultures and customs permeable, and erode internal
cohesion and citizens’ identification with the state

Functions (with limitations) of the state in economic globalization

- It meets the need to regulate global markets
- It continues to provide enterprise with a safe environment so that companies can flourish
- It takes responsibility for internal law and order:
- The protection of property rights
- The struggle against the threat of global terrorism
- It guarantees the development of road, rail and communication infrastructure
- It takes care of supplying a skilled workforce, and guarantees education and training for citizens
- If necessary, it even supplies the financial system with liquidity, and buys “toxic” tock or
nationalises financial institutions in order to prevent the collapse of the financial system

THE GLOBALIZATION TRILEMMA

OPTION 1 - THE BUDGET GIRDLE

Robust stes + hyperglobalization:

- State policies aligned with international standards to attract international capitals

Consequences:
- Isolation of economic policies from public debate
- Disappearance of privatisation of social security
- Downward pressure on taxation
- Erosion of the social compact between employers and workers
- Replacement of the objectives of economic development with the objectives of the market

Summing up: less space for democratic deliberation

Is it feasible? CONS:
- Can you save an economy by tying it to the mast of globalization?
- National democracy and deep globalization are incompatible
- Foreign creditors become more important than locals’ rights - ex:
- Greece (2011) and ‘the closed account’
- Spain (2011) “creditors come first”

- Rodrik’s thesis: (Unrestricted capital markets + free trade + free enterprise + little government) IS
INCOMPATIBLE WITH DEMOCRACY:
- Requires shrinking domestic policies
- And insulating technocrats from popular demands (it is not desirable, not possible)

OPTION 2 - GLOBAL FEDERALISM

- We should let nation states fall + democratize IOs

What would we need:

- Solid IOs operating under strict rules + IOs robust and powerful enough to set and enforce global
standards
- Mechanisms of accountability and responsibilization - a source of legitimacy

Option:
- Scale up national politics to a global level
- Pros: It benefits from globalization
- Cons: Difficult to implement

Problems:
- Can we really scale up democracy?
- We need a global political community, to which IOs are accountable to
- Who legitimizes and empowers the present geopolitical actors?
- There is no global governance without COSMOPOLITAN (GLOBAL) CITIZENS

Main problems:
 - How high the bar of global standards should (but actually) can be? RACE TO THE BOTTOM (i.e
on taxation) - it is better to have different regulatory frameworks. Ex: labour, safety, rules, child
labour
- How ell can market-based solutions work to set global standards - NOT TOO WELL.
- There are limits to global governance - THE WORLD IS TOO DIVERSE, let each country decide

- Globalization and identity:

- More IT interconnectedness - more involvement in local culture and less global
consciousness
- Cosmopolitanism appeals only to rich or highly educated people

- Limitations to global governance:

- Political identities are generated around the nation state
- Political communities are state based
- Truly global norms are scarce

“The scope of workable global regulation limits the scope of desirable globalization’ - we should only
globalize those areas that can be regulated and monitored

OPTION 3 - BACK TO A LIMITED GLOBALIZATION

We must allow different paths to globalize a country - we should recover a Bretton Woods-type of
agreement

OPTIONS:
- Democracy within nation states or hyperglobalization?
- Who should set the economic goals of a country: citizens or markets

Difficulties of hyperglobalization:
- Many people oppose open markets
- The increase of marginal economic benefit of opening up markets decreases
- State policy space needs to be guaranteed
- Opt-out clauses need to be applied when there is solid and scientific reason

Problems:
- Historically, the return to the state has meant protectionism, trade wars and conflict
- The nation state option does not solve the problem of the global commons. We still need broad
goal agreements, common structures and supra-state regulations enabling us to face global risks
- One of the main benefits of the present system - particularly within the WTO - is that it is
advancing towards symmetry - same rules for all
- Rodrik takes us back to unilateralism and bilateral relations among states
- There is no perfect form of friction less globalization