Lesson 1 - Page 3 - Are there links between globalization, wealth, and human development?

One of the hallmark characteristics of the global economy is the concept of interdependence - a state in which two or more places are mutually dependent and connected across space by some form of activity. Economic globalization is linking places around the world through activities such as production, trade, and consumption. As national economies become increasingly integrated through global trade, the economic growth of any given nation becomes increasingly dependent upon the economic welfare of its trade partners. Activities such as the choice of clothes you buy have a direct impact on the lives of people working in the nations that produce those goods. As Giddens (1990) put it, we now live in a world characterized by an "intensification of worldwide social relations (linking) distant realities in such a way that local events are shaped by events occurring many miles away, and vice versa".

With globalization, competition occurs between nations having different standards for worker pay, health insurance, and labor regulations. Corporations are able to benefit from lower labor costs found in developing regions, thanks to free-trade agreements and a new international division of labor. A worker in a high-wage country is thus increasingly struggling in the face of competition from workers in low-wage countries. Entire sectors of employment in developed countries are now subject to this growing international competition, and unemployment has crippled many localities. The outcome has been an international division of labor in all sectors of the economy. In particular, manufacturing is increasingly being contracted out to lower-cost locations, which are often found in developing countries with no minimum wage and few environmental regulations.

A good example of international division of labor can be found in the clothes-making industry. What was once a staple industry in most developed Western economies has now been relocated to developing countries in Central America, Eastern Europe, North Africa, Asia, and elsewhere. This change has prompted economists and scientists to ask questions that lie at the heart of the globalization debate: Are large retailers in the United States and Europe exploiting workers who are paid low wages in some developing regions? Is globalization placing developing countries on a road to a more advanced economy that will pay higher wages in the future?

Collaborative Learning Activity 1.2 - How does global interdependence affect people and places?

To conclude this lesson, your team will explore the concept of interdependence by examining how some workers in the textile industry are affected by and participate in the global economy. In the following activity, your team will take a closer look at an actual place where clothing and garments are manufactured for export. The activity explores how many countries attempt to develop their economies by creating export-processing zones to attract foreign investment and manufacturing industries. Your team will also learn what life is like for many workers who are employed by textile companies located within these export-processing zones.

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Summary

In this lesson, your team learned about the basic components of the global economy and how individuals are affected by and participate in economic activities that form the basis of the global economy. You evaluated different methods that geographers and other scientists use to measure and compare economic development and standards of living in different places. Finally, the Lesson explored some of the ways the global economy affects the lives of workers and contributes to rapid economic change.

In the next lesson, we will focus in greater detail on international trade, and study how trade shapes the global economy and helps to explain geographic patterns of economic development.

Review of Materials Due

Before your team proceeds to the next lesson, each local group should:

1. Submit your group's table and map from the international clothing survey to your instructor (Collaborative Learning Activity 1.1).
2. Post answers to all "blue box" discussion questions in the Group Discussion Board.

Your team should begin Lesson 2 on the date assigned by your instructor.