Although economic forces are an integral part of globalisation, it would be wrong to suggest that they alone produce it. Globalisation is created by the coming together of politics, social, cultural and economic factors. It has been driven forward above all by the development of the information and communication technologies that have intensified the speed and scope of interaction between people al over the world. As a simple example, think of the last 2008 Olympics. Because of global television links some of the sports are now watched by millions worldwide.
Marx believed direct expressions of underlying economic organisation, quite different types of political order may exist in societies that have similar production systems. For instance, some societies based on industrial capitalism have had authoritarian political systems (examples are Nazi German and South Africa under apartheid) whole others are much more democratic for example, the United States, Britain or Sweden.
The impact of science and technology both influence and are influenced by political and cultural factors scientific and technology development for example helped create modern forms of communication such as radio and television. Radio, television and other electronic media have also come to shape the how we think and feel about the world. The invention of writing for instance, allowed for the keeping of records, making possible increased control of material resources and development of large scale organisations.
The free market does nothing to address re-distribution of wealth. It assumes that wealth will “trickle down” to the poor. The former British Prime Minister, Margaret Thatcher, once said “it is our job to glory in inequality and see that talents and abilities are given vent and expression for the benefit of all of us”.
Critics of globalisation say that the rising inequality is the inevitable result of market forces. Given free reign, market forces give the rich the power to add further to their wealth. Hence, large corporations invest in poor countries only because they can make greater profits from low wage levels or because they can get access to their natural resources.
There was a big expansion in world trade and investment in the late nineteenth century. This was brought to halt by the First World War and the bout of anti-free trade protectionism that led to the Great Depression in 1930. The end of the Second World War brought another great expansion of capitalism with the development of multinational companies interested in producing and selling in the domestic markets of nations around the world. The emancipation of colonies created a new world order Air Travel and the development of international communications enhanced the progress of international business.
A critical aspect of globalisation is that nature and power that multinational corporations, they account for over 33% of world output and 66% of world trade for example car manufactures who source their components from other countries. Nevertheless international businesses are still to a certain extent confined to their home territory, their businesses are nationally embedded and continue to operate as multinational rather than transatlantic companies. The globalisation and transformation from multinational to transatlantic has not fully occurred multinationals still have considerable economic and cultural power.
The transformation affects the status quo in the sense that with the take over by multinational companies I.e. Wal-Mart, Tesco or BP results in wages being paid in new settings which are usually minimal, workers conditions and rights are poor e.g. Nike, Ralph Lauren and Adidas were paying as little as 13 cents.
