| La lettre du GERPISA | no 105 (juillet 1996) |
Research Questions - Nicolas Hatzfeld
Michael Porter presented global industry as being a performance within an economic zone dependant on what occurs in other zones, thus implying a degree of inter-dependance which is much greater than a simple globalization of activities. Globalization can be envisioned as the interaction of several parameters : the growth of economic activity and competition with, in particular, the phasing out of borders and tariffs, as well as the intensification of international activities; an increasing number of actors participating in this movement (firms or countries) especially those more commonly known as "developing countries"; and finally, the increase in complexity of international phenomena. For example, one can not totally disassociate the unemployment rate in certain developed countries from, at the same time, the creation of jobs in developing countries.
Though these movements characterize globalization which has been underway since the 1980s, it nevertheless is necessary to take a closer and more precise look in order to better draw general conclusions. First of all, globalization seems to take on a different reality in function of the economic domain under consideration, allowing one to notice certain limits and inequalities. Thus, financiarization of the economy and finance market globalization, not to mention the generalization of competition, are clear components of this globalization. Likewise, the examination of international exchanges points to their important increase from both an inter-regional standpoint, as well as within the world's large economic regions.
On the other hand, one can not really speak of production globalization. Though firms play an important role in economic globalization, they also establish strategies which favor local and even national factors.
These globalization strategies on the part of firms are quite diverse. For example, among Japanese carmakers, Honda's "global-local" strategy is quite different in the realm of production from the more regional-oriented Toyota strategy. Indeed, these strategies are very much dependant on the history of each firm. If one strays somewhat from official strategies announced by firms and looks more closely at real strategies, one may notice that the latter are more "multi-local" or "multi-domestic" than global. Finally, though numerous economic agents tend to lean towards globalization, political and institutional forces still underline a strong regional integration. This can be seen in the construction of large groups such as the European Union, ASEAN, or NAFTA. Hence, the sudden deregualtion wave of the 1980s initiated by the United States provoked a consolidation reaction on the part of the European Union before accepting to follow this trend. This European reaction was one of the major factors which led the United States to propose and obtain from its two neighbors, Canada and Mexico, the establishment of NAFTA.
Globalization points to the existence of very important inequities. For example, dynamics linked to demand and the evolutions of prices resemble each other from country to country, however national levels remain very different. Likewise, investments multiply in developing countries but in a very selective manner, and concentrate only in well-advanced countries. The existence of those few developing countries - new actors on the international economic scene - should not make one forget the numerous "underdeveloped" countries whose hopes to enter into a growth period are slim or far away.
The present-day globalization wave should be placed within a historical perspective in order to be fully understood.
Indeed, on the one hand the perception one has of it is amplified by the fact that it follows the 1945-1973 period during which what dominated, on the contrary, were national compromises translating into feeble economic interdependences and original national forms. However in the past, the world economy had experienced important spurts of globalization, especially in the decades preceding World War I and in the 1920s.
In certain ways, at the beginning of the century the world economy was more open than today. The model of developing countries' extrovert economies follows along the same lines as, for example, that of the growing British economy during the 19th century. This comparison would help to better take into consideration the link between different aspects of these economies. Though Korea is remarked today because of its vigorous export rate, one must not forget that this country had to rapidly and greatly increase salaries following severe social and political conflicts. Domestic market growth was one of the conditions for this expansion.
However, general coherence of the undergoing evolution is not yet acquired, and this could weaken or even halt growth. To a certain extent, the preceding period had benefited from coherence imposed by the United States. Now, the relative retreat of the US has not yet been compensated for by a new form of hegemony, both Japan and Europe not yet capable of taking over from the US for reasons linked to their own specificities. This has led to a certain degree of instability and fragility in the present-day globalization wave.