globalization sunum

8/2/2019 Globalization Sunum

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PREPARED BY: BUKET ERBAYRAKTAR



In this study, globalization concept has been examined with its positive and negative waysand also with its economical, political,technological and cultural dimensions. Then,historical process of globalization has been explained according to three importantperiods in general of the word. Effects ofglobalization on the economic development

is the other important parts of this study andfinally, Turkey experience duringglobalization process has been analyzedaccording to three important periods.



Nowadays, globalization concept is calledwith different idoms such as ́ new worldorderµ and ´global villageµ. Globalization isthe one of the controversial issues of world

and also Turkey.During the globalization process many of

developing countries opened their economicsto global market with changes in their recentpolitics (Olgun, 2006: 143).

The aim is to develop welfare level ofcountries through increasing of internationalcompetition and more efficient distribution of sources (Danolu, 2006: 218).



Globalization process in the world is not anew phenomenon.

According to some of assumptions,

globalization process is acceptedsimultaneously with development ofcapitalism and modernization but some ofassumptions argue that globalization is a

process that existed with early history(Karabçak, 2002: 118).



"Globalization, Growth and Poverty" that is a

report made by The World Bank to explain the globalization's process.

Globalization is divided in three main stepsin this report.

The first stage of the globalization is placedbetween 1870 - 1914 period and ischaracterized by the expansion of theinternational trade.

The liberalization in the 19th century wasthe perfect environment in a short period forthe international trade and investment.



The second stage of the globalization tookplace between 1950-1980 period and ischaracterized by the liberalization of theinternational trade under the GeneralAgreement on Tariffs and Trade (GATT)influence.

In this second step of globalization, thestates with powerful economies achieved adegree of development.

The amount of their exports became largerand larger and their transnational companiesexpanded quite.



The third stage of the globalization processbegan in 1980 and continued until thepresent days.

It is characterized by development of thetelecommunications and huge progresses in the exploration of the cosmic space.

This period is often called "Economy withoutBorders" because the modern technologyincreased the speed of the long distancefinancial trades.



In January 1995 World Trade Organization (WTO) was created which is the successor ofGATT.

WTO is the only international organization that establishes the legal bases in the tradesbetween the countries.

The main goal of this system is to achievemaximal liberty for the commercial flowswithout undesirable secondary effects(Radescu, 2008: 2).



Globalization is a multidimensional conceptand these all dimensions are related to each

other. Thus globalization is shaped as a result of

this interaction.

When the globalization is explained, the

dimensions have an importance.



Economic dimension is the one of mostimportant components of globalization.

Also modern economic globalization has

three sub²components.One of these is related to distinctive

characteristics of today·s international trade.

The second sub²component of modern

economic globalization is related to capacity,depth and variety of today·s global financialmarkets and global capital flows.



The last sub²component of economicdimension of globalization is radicaltransformation in global production.

Nowadays, in contrast to traditional nation state structure, production activities areimplemented globally and different stages ofproduction are resulted in differentgeographies.

In this process the most important agency ismultinational companies.



These companies act in many economic areasuch as portfolio investments, direct foreign investments, international good and servicetrade, tourism.

On the other hand today, the most importantcharacteristic of production process is tofocus service production instead of goodproduction and so the most important

production factor transformed to qualifiedhuman resource (Bayar, 2009: 27-28).



Political globalization can be defined asstructural transformation in today·s politicalpower, authority, and regimes.

Global politics is shaped by interaction ofnation-state, overstates institutions, localgovernments and non-governmentalorganizations.

One of the most important characteristic ofglobal politics is to become more invalid ofdistinction between traditional domestic andforeign policy in time (Bayar, 2009: 28-29).



One of the most important trigger ofglobalization is the ´communication revolutionµthat is developing rapidly. This revolution is alsocalled as ´Third Industry Revolutionµ. Its basiccharacteristics are:1) To benefit from microprocessor and satellitetechnology in data transmission.2) Hiding, storage, and processing of knowledge.

3) To benefit from digital environment forprocessing of knowledge.4) Decline in production and usage costs ofcommunication devices (Bayar, 2009: 29).



Globalization creates important effects on culture.

Especially a result of communication

revolution, there is a high level ofinteraction among individuals and societies in general of world.

The cultural dimension of globalization alsodeals with gender issues, questions ofidentity, and the social construction ofreality, as well as the production andconsumption of media(Bayar, 2009: 30).



In recent years the events show that worldincome distribution is deteriorating and newincome imbalance is threatening economics

of countries. The gap between developed and developing

countries is growing gradually.

At the same time in the same country,

income distribution among individuals isdeteriorating.



There are many positive or negative effectsof globalization on the economics ofcountries.

Positive effects are developing of foreign

trade, increasing of multinational companies,improving of competition conditions,removing of obstacles that restrain freemovement of international finance,

increasing of foreign investors andinvestments and, economic development.



Negative effects of globalization are

increasing of economical dependency ofnation-states, deteriorating of balance oftrade and money and capital movement,emergency of production insufficiency in economics of countries and, increasing ofpoverty.

According to statistical data, GDP isincreasing since 1980 in general of the world.At the same time population of countries is

increasing rapidly so this situation effectseconomic growth and developmentnegatively (Karabçak, 2002: 119-120).



Globalization process in Turkey startedbetween 1980 ² 1983 period and completedbetween 1989 ² 1990 period.

There are four important turning points ofglobalization in Turkey.

The first one is realized between January 241980 and November 1983.

In this period Stratocracy implementedstability and structural coherence programsso prices under the control were liberalizedand value of Turkish Lira was depreciated.



The second period of globalization of Turkeystarted with coming to power of ANAP in 1983.

In this period both the trade regime andcapital markets are liberalized on a largescale. 1983 ² 1987 period was called ´export-

oriented growthµ.During this period growth was realized

through export and rate of outward-orientedeconomy increased from 63% to 80%. Alsoaverage 6.5% growth rate was realized in Gross Domestic Product (GDP).

The third period of globalization was realizedthrough liberalization of capital marketscompletely in 1989.



Between 1980 ² 1990 period of globalization

in Turkey primarily good markets opened toforeign market and import politics under thetrade quotas was liberalized.

Exchange rate was made flexible through a

high devaluation and industry wasencouraged to export through subsidies.

After 1990s Turkish economy has became an outward ² oriented completely.

Foreign trade also liberalized through customunion that was established with European Union in 1996.



When the income distribution and povertyrates are analyzed, a disturbance is seen during transformation of economy politics in Turkey.

Inequality in income distribution has been increasing from 1970s to 2000s because ofeffects of globalization.

Also social expenditures are directly relatedto poverty but in Turkey public incomes areused to pay debts and interest of debtsinstead of enhancement of incomedistribution and poverty.



Turkish economy has not had an achievementon removal poverty issue since 1980s.

In addition, Turkish economy experiencedfrom 1980 transformation on education.

Private education expenditures are morethan public education expenditures and thisimbalance effects income distribution between rich and poor people because low

income people couldn·t benefit from privateeducation.



Globalization is the process of the completeintegration of the constituent parts of theworld economy with each other and with the

international system. In order to benefitfrom the globalization process, the quality ofa country·s macroeconomic policies is thekey instrument. Particularly free market and

sound money should be established strongly.

globalization sunum

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