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GLOBAL POLITICS Chapter 10 Lecture 1. What is the Purpose of Political Systems? .

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what is the purpose of political systems
What is the Purpose of Political Systems?
  • Domestic: to achieve balance between individual (self-interest) and collective (common good) interests when beliefs, values, and behaviors are (mostly) sharedGlobal: Achieve this same balance when beliefs, values, and behavior are not shared
roles of government
Roles of Government
  • Make decisions (laws, treaties, etc.)
    • Democracy
    • Command
      • Monarchy
      • Dictatorship
  • Distribute or redistribute resources distribution (taxes and social programs)
    • Socialism—the state decides
    • Markets—the market decides
governments intervene in markets
Governments Intervene in Markets
  • Protect future, e.g., environmentalism, build infrastructure that all use
  • Provide public goods, e.g., police, parks, highways
  • Correct spillovers and externalities, e.g., encourage R&D that is not directly profitable such as “orphan drugs”
  • Correct for business cycle instabilities
  • Maintain principles of justice and equality, e.g., equal access to good schooling
political systems affect business investments through
Political Systems Affect Business Investments Through
  • Rules of law
    • Transparent
    • consistent
    • Enforced
  • Property rights
  • Taxes
  • Government services
  • Standards, treaties, etc.
three main types of legal systems
Three Main Types of Legal Systems
  • Civil Law
    • Laws are absolute and specific and not subject to much interpretation—most of W. Europe except British Commonwealth
  • Common law
    • courts interpret law to set precedents: British Commonwealth and US
  • Religious law
    • Sharia
    • Animist tradition
global political shifts create interconnections
Global Political Shifts Create Interconnections
  • Transfer of government roles to businesses
    • Privatization
    • Deregulation
  • Governments play more active roles in business
    • Industrial policies and subsidies
    • Stimulating business activities
      • Encourage export activities
      • Attract FDI
  • Civil society organizations
    • monitor activities
    • collaborate
    • engage in social activism
5 public goods a global governance system can provide
5 Public Goods a Global Governance System Can Provide
  • A systematic financial system to smooth worldwide volatility
  • Protection of the global commons and a framework to promote sustainable development
  • An open system for trade, technology transfer, and investment with acceptable dispute mechanisms
  • Infrastructure and institutions to reach agreements on common systems like weights and measures or aviation and communication systems
  • Equity and social cohesion through economic cooperation that includes international development assistance and disaster relief (Commission on, 1995)
reasons for global governance of business
Reasons for Global Governance of Business
  • Trade growth requires facilitation
  • Worldwide economic development is likely to remain uneven without global action
  • Trade and other global activities cannot easily be managed without common safety and a common defense system
forces opposing global governance
Forces Opposing Global Governance
  • Nation state history suggests few will be eager to sacrifice national interests to global interests
  • When the focus is on economic interests, national leaders may give priority to businesses over those of the poor or the disenfranchised
  • Compromise is almost inevitable
many organizations shape global governance
Many Organizations Shape Global Governance
  • Businesses
    • Lobby or pressure governments
    • Professional groups influence standards
    • Businesses collaborate with governments to solve problems
  • Global gangs
  • Other global actors, e.g., churches, universities
  • Intergovernmental organizations
    • UN, WTO, NATO, OECD, etc.
  • Nongovernmental or civil society organizations
non governmental organizations ngos play these roles to shape global governance
Non Governmental Organizations (NGOs) Play these Roles to Shape Global Governance

meeting present and future needs

CHARITABLE

SAVE THE CHILDREN; UNICEF; CARE

RESCUE

AMNESTY INTERNATIONAL

PREVENTATIVE

GREENPEACE; SAVE THE WHALES

DEVELOPMENTAL

HABITAT FOR HUMANITY; L’ARCHE

reasons for third sector role in global politics
Reasons for Third Sector Role in Global Politics

1. PERCEIVED CRISIS OF THE WELFARE STATE

2. CRISIS OF DEVELOPMENT; NEED FOR QUICK CHANGE

3. GLOBAL ENVIRONMENTAL CRISIS

4. CRISIS OF SOCIALISM STIMULATED EXPERIMENTS

5. IMPROVED LITERACY AND A COMMUNICATION REVOLUTION

6. GROWING MIDDLE CLASS AND HIGHER ASPIRATIONS

intergovernmental organizations
Intergovernmental Organizations
  • Trade agreements
    • Bilateral
    • Multilateral
      • Regional—NAFTA, EU
        • Free trade area, customs union, common market, economic integration
      • Nonregional—ASEAN
      • Global—from GATT to WTO
eec to the eu
EEC to the EU

6 countries in 1957

12 by 1986

15 by 1995—Sweden, Finland, Austria (Norway declined to join)

25 in 2004

slide16

German head for business

Danish eye for design

Belgian ear for languages

Irish mouth for charm

English stiff upper lip for perseverance

Portuguese nose for opportunity

Frenchflair for quality of life

Italian hand for crafts

Luxembourg for deep pockets

Dutch touch for industry creation

Spanish feet for quick adaptation

Greek heel for weakest link

a regional example from common market to european union
A regional example: FROM COMMON MARKET TO EUROPEAN UNION
  • Post World War II development based on fear:
    • 1. Germany
    • 2. Cold War
  • EEC or COMMON MARKET—1957
    • Economic purpose: to reduce internal barriers to common market;improve flow of productive factors
  • 1992 Maastricht Treaty
    • Economic and monetary; cultural artifacts merge
a global example from gatt to wto
A Global example: FROM GATT TO WTO
  • Single market needs a single set of commercial rules
general agreement on trade tariffs
General Agreement on Trade & Tariffs
  • 1947, an agreement among 23 nations to follow common rules
  • Rules revised via rounds, e.g., Tokyo Round, Uruguay Round (1986)
  • Difficult to enforce
  • Only 2/3 of world trade covered by GATT
    • a) Exceptions to Most Favored Nation, e.g.,
      • Preference for manufactured goods from developing countries
      • Common market concessions
    • b) Areas not covered by GATT, e.g., services, intellectual property, agriculture, textiles
world trade organization
WORLD TRADE ORGANIZATION
  • The successor to GATT in 1995
  • Exists for 3 purposes:
    • Promote world trade
    • Provide a framework for trade negotiations
    • Provide a mechanism for resolution of trade disputes
need for a global governance system open systems infrastructure and equity
Need for a Global Governance System: Open Systems, Infrastructure, and Equity
  • An open system to facilitate trade
    • ISO and global accounting standards
    • Standards on transparency and corruption
  • Infrastructures and institutions for
    • Security
    • Conflict management
    • Crime management
    • Supra Terrorism
  • Equity
    • To create a viable world future