Within the United States and especially Europe the sometimes fierce debates about which is best for our country, Globalism or Nationalism. Globalism has been supported by many of the Elites as contrasted by a large movement of the common citizens who support the Nationalistic movement as proposed most recently by Donald Trump. Below are listed the common cases for both movements.
Case for Globalism:
Improved transport, making global travel easier. For example, there has been a rapid growth in air travel, enabling greater movement of people and goods across the globe.
Containerisation. From 1970, there was a rapid adoption of the steel transport container. This reduced the costs of inter-modal transport, making trade cheaper and more efficient.
Improved technology which makes it easier to communicate and share information around the world. E.g. internet. For example, to work on improvements on this website, I will go to a global online community, like elance.com. There, people from any country can bid for the right to provide a service. It means that I can often find people to do a job relatively cheaply because labour costs are relatively lower in the Indian sub-continent.
Growth of multinational companies with a global presence in many different economies.
Growth of global trading blocks which have reduced national barriers. (e.g. European Union, NAFTA, ASEAN)
Reduced tariff barriers which encourage global trade. Often this has occurred through the support of the WTO.
Firms exploiting gains from economies of scale to gain increased specialisation. This is an essential feature of new trade theory.
Growth of global media.
Global trade cycle. Economic growth is global in nature. This means countries are increasingly interconnected. (e.g. recession in one country affects global trade and invariably causes an economic downturn in major trading partners.)
Financial system increasingly global in nature. When US banks suffered losses due to the sub-prime mortgage crisis, it affected all major banks in other countries who had bought financial derivatives from US banks and mortgage companies.
Improved mobility of capital. In the past few decades, there has been a general reduction in capital barriers, making it easier for capital to flow between different economies. This has increased the ability for firms to receive finance. It has also increased the global interconnectedness of global financial markets.
Increased mobility of labour. People are more willing to move between different countries in search for work. Global trade remittances now play a large role in transfers from developed countries to developing countries.
Internet. This enables firms to communicate on a global level, this may overcome managerial diseconomies of scale. The firm may be able to get cheaper supplies by dealing with a wider choice of firms. Consumers are also able to order more goods online E.G. Dell Computers takes orders online and can meet customer specifications.
Case for Nationalism:
- Political Party or parties exploiting the people’s frustration against the government stoking national sentiments by shifting blame of mis governance against a particular group.
- Exploiting Ethnic/religious differences for political gains.
- To unite various groups of people who don’t have common ethno-religious identity to fight against a colonial power
- Nationalism beyond a point or for a short term gain becomes dangerous if it becomes aggressive and intolerant towards other human beings
- New Nations with ethnic diversity requires patriotism for nation building
- Patriotism becomes aggressive nationalism when it identifies certain symbols and rituals as forms of proving nationalism and become divisive and destructive in nature.
- Author: Abdul Majeed Shoaib
