New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

INTS 201, Week 4 Reading Notes

by: Christina Roberts

INTS 201, Week 4 Reading Notes INTS 201

Marketplace > Texas A&M University > INTS 201 > INTS 201 Week 4 Reading Notes
Christina Roberts
Texas A&M
GPA 3.5

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

These notes cover Chapter 13 of Thinking Globally.
Dr. Dinah Hannaford
Class Notes
world, economy
25 ?




Popular in

Popular in Department

This 5 page Class Notes was uploaded by Christina Roberts on Wednesday September 28, 2016. The Class Notes belongs to INTS 201 at Texas A&M University taught by Dr. Dinah Hannaford in Fall 2016. Since its upload, it has received 41 views.


Reviews for INTS 201, Week 4 Reading Notes


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 09/28/16
INTS 201: Chapter 13 Reading Notes Transnational Economy and Global Labor OVERVIEW - Economic globalization involves not only the expansion of corporate capitalism but also the globalization of manufacturing, the distribution and ownership of goods, and financial investments. This leads to great transformations in the way global business occurs. - In today’s world, there are so many ways that economic activity is controlled and distributed. So in order to make things easier, trade agreements and the World Trade Organization (WTO) were made. The WTO was “created to encourage agreements that will facilitate trade and provide for some kind of monitoring of the situation to make sure the agreements work.” (pg. 256) - “The fact is that very few international agencies monitor labor and environmental standards and demand that minimum expectations be met. In a global era in general, the problems are those of accountability and control.” (pg. 257) - People have been protesting the WTO for many years because of their inability to regulate but also enforce these standards. Outsourcing Notes - “Outsourcing—sometimes referred to as subcontracting—involves a firm’s use of an external vendor to provide a business function that would otherwise be done by the firm itself.” (pg. 258) - Companies from larger and more well-established countries will outsource much of their work to lower wage countries in order to save money. This has been made possible by being able to coordinate suppliers and services on a global scale and the transportation of goods across the globe. - One of the main reasons outsourcing has become so common is because companies want to cut labor costs, get tax breaks, and have easier access to large markets. - “The term ‘supply chain,’ which is prominent in the business literature, emphasizes the role that different firms play as suppliers of key inputs for a final product, and has given rise to a field of study concerned with supply chain management. The term 1 ‘commodity chain’ refers to those networks of labor and production processes that result in a finished commodity.” (pg. 260) - Often times, large manufacturing companies rule over producer-based commodity chains. This leads to slow responses to the ever-changing market conditions. - Buyer-based commodity chains are ruled by large retailers or brands. These retailers don’t usually make their own products, but instead have them made in a vast global network of independently owned factories. - An advantage of outsourcing is that suppliers can move into higher value-added activities. For example, a company can go from making parts of a product to completing the finished product. - “All forms of upgrading involve ‘organizational learning’—the ability of a firm to learn form its experiences in a global production network, often from the firms for which it is providing inputs.” (pg. 261) - Many critics of globalization see outsourcing as a way for companies to move the production of goods to the lowest wage sites around the world. The fear is that if and when the workers receive better pay, the company will just pick up and move to a location to a place with lower wage costs. - This encourages workers to not form unions in order to get better working conditions and pay. They are afraid that they will lose their contracts if they begin forming unions. Also, companies are not technically or legally liable for any mistreatment that goes on in subcontracted factories. Because products are not being made in the home country, labor laws of that country cannot be enforced in the places where outsourcing is occurring. Wal-Mart: Template for 21st Century Capitalism? (Nelson Lichtenstein) - The most important companies are the giant corporations because the shape world capitalism. - Template businesses are those that perfect the best ways to be efficient and make a profit in their particular time period. And in the 21st century, Walmart is that template business. - “Walmart perfectly embodies the process of ‘creative destruction’ identified by the early 20th century economist Joseph Schumpeter as the engine by which one mode of capitalist production and distribution is replaced by another.” (pg. 264) 2 - Because of Walmart’s immense size, they receive more political and social scrutiny when standards of production are not upheld. - “Every firm has an optimal size beyond which the risk of loss from mismanagement more than offsets the chance of gain from the economies of scale it can realize.” (pg. 266) - So in the 21st century, companies can have a fewer amount of highly skilled workers and executives who then contract out the less vital jobs to cheaper firms. Outsourcing of jobs even the simplest of jobs becomes more commonplace. Who Is Us? (Robert B. Reich) - In order to rejuvenate the competitiveness of American business, we must invest time and resources into training people and not necessarily devoting effort towards corporations. The “us” is the American people, or the work force. - In recent years, America has been employing more and more nationals, using factories and facilities overseas to make their products, and are exporting directly from those overseas facilities the products that they make. - “Overall, the evidence suggests that U.S. companies have not lost their competitive edge over the last 20 years—they’ve just moved their base of operations.” (pg. 269) - Not only are U.S. corporations moving overseas, foreign companies are moving to the U.S. And all of those non-U.S. companies are drastically exporting products from the U.S. Two Critiques of Globalization (Jagdish Bhagwati) - The author argues that globalization has a human face. For example, there is a wage gap between men and women working the exact same job. But because of globalization, companies are less likely to want to pay more to equally qualified men when the begin facing international competition. So the wage gap in theory would slowly shrink because of globalization. - Fear and self-interest often seem to drive globalization. “The fear of trade and multinationals today particularly afflicts the rich countries, where many are afraid that economic prosperity is imperiled by trade with the poor countries. Additionally, the 3 working classes and the unions typically fear that their wages and standards are in peril from trade with poor countries.” (pg. 272) - Although trade is not the sole cause of prosperity, there is a correlation between the two. For example, countries with high economic growth also had expanding trade markets, while poor countries had a horrible trade performance. - “The long-standing stagnation, or at best very sluggish rise, in workers’ earnings in the United States has given rise to the fear that globalization, involving trade with the poor countries and also illegal unskilled immigration from them, is at the heart of the problem.” (pg. 273) But this causation is not completely accurate. - So despite everyone’s fears, including richer countries, globalization is not the direct cause of stagnation in the United States. What is a cause of the problem is the large amount of unskilled-labor-saving change that is occurring and putting pressure on the wages of those unskilled workers. - For example, computers are taking over jobs that were once performed by people, like the position of secretaries. - “The facts are that this is rapidly occurring in the United States, and in other rich countries, as technical change is quickly spreading through the system. This naturally creates, in the short-run, pressure on the jobs and wages of the workers being displaced.” (pg. 275) Toward a Globalization with a More Human Face (Joseph Stiglitz) - One of the major criticisms of globalization is that it appears to be taking over traditional values. So the pace of how the world is becoming more global is important. If globalization occurs at a slower, more steady pace, small businesses and more traditional institutions can have time to adapt and adjust to the new and fast paced world of globalization. - “If globalization continues to be conducted in the way that it has been in the past, if we continue to fail to learn from our mistakes, globalization will not only not succeed in promoting development but will continue to create poverty and instability.” (pg. 277) - Those who live in underdeveloped countries have more to lose economically, but political consequences will also been felt in the richer and more developed countries. 4 - “Development is about transforming societies, improving the lives of the poor, enabling everyone to have a chance at success and access to health care and education.” (pg. 279) - The more developed countries have the responsibility of reforming the international institutions that are regulating globalization. This is the only way we can make globalization work for not only the rich countries, but also the underdeveloped world. 5


Buy Material

Are you sure you want to buy this material for

25 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."

Kyle Maynard Purdue

"When you're taking detailed notes and trying to help everyone else out in the class, it really helps you learn and understand the I made $280 on my first study guide!"

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Parker Thompson 500 Startups

"It's a great way for students to improve their educational experience and it seemed like a product that everybody wants, so all the people participating are winning."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.