Effects of Globalization and Neoliberalism on States

Paper Type:  Essay
Pages:  7
Wordcount:  1747 Words
Date:  2022-03-29

The doctrine of protected communities has over time lost influence as the world becomes more convergent and defies set boundaries. This means that geographical location is basically an immaterial barrier to connecting people all over the world. Major strides made by humanity towards global connectivity provides the basis for the discussion on globalization and neoliberalism. Globalization is the worldwide integration of economies, trade, finance, culture and communication such that state boundaries are surpassed, making States operate predominantly in an open global sphere. Neoliberalism on the other hand is more focused on the need for capitalism to work efficiently by having the State exercise very little control on the economy and as Kotz (2002) puts it "...neoliberals believe that capitalists who operate freely are not only an embodiment of free individual choice but are also more economically efficient" .This essay will provide a discussion on the impact of globalization and neoliberalism on different States and whether such impacts are homogenous across the globe or not. The essay will also provide insight on the same by comparing and contrasting select case studies on globalization and neoliberalism.

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State boundaries define the realms for sovereign governments, laws, and culture. As State interactions develop and mature into complex webs, the boundaries are eventually surpassed. Such developments produce different impacts for party states as they are fundamentally unique in their characteristics and potential needs. This means that even if similar dynamics are operating between states the degree and impact differs for those states. "Globalization despite experiencing profound growth has not infiltrated into some states, as they are still shielded from the rest of the world due to limited internet access caused by digital divide "(Dhanapala, 2001). This excerpt shows how technology has played a big part in the emergence of globalization and its dynamics influences the resultant effects on different states.

The economic disparity between States contributes to different manifestations of globalization and neoliberalism in the said States. State resource endowment dictates its economic output limits and consequently the need for outsourcing between nations. Globalization means that there's faster flow of goods, services and information among nations. This enables nations to get cheaper goods from outsourcing cheaper labor and cheaper production techniques. Labor providers are able to provide employment opportunities for their population. Labor flow is by far the most controversial of the effect of globalization, where workers in the corporations' state of origin feel that jobs are being exported at their expense. Production in countries with cheap labor puts other workers at a disadvantage as they are forced to compete with others who demand less than their minimum wage (Chirico, 2013).

Societies hold different ideas and values from others outside their influence. Globalization has propelled a clash of this ideals. Cultures in different States slowly begin to adapt to other states' values so as to enhance free flow between them. This culture integration causes morphism in fundamental characteristics of a particular society. the major player in such cultural changes in the media as it cuts across all cultures. "Societies may be empowered by globalization as it enables them to have a collective identity and provide a means for self-representation" (Smith, 2000). Sadly, cultural integration may cause misrepresentation of particular societies and the loss of individualism. This goes further to prove that the effects of globalization on particular culture will largely depend on its influence upon other cultures such that different states will be affected differently.

The fastest and most dynamic effects of both globalization and neoliberalism would be financial. States are faced with an expanded arena for financial participation with very diverse products. The fact that transactions can be carried out instantaneously in a wide array of geographical locations means that economies cannot remain sheltered from the rest of the world. The complexity of international finance drives to the fact that, its effect on party states is as diverse as it is individualistic. These effects range from better trade, intensified competition, better quality products, failure of smaller local industries, availability of better employment opportunities etc. the effects on a state in the wake of globalization, is therefore dependent on the development and extent of growth in financial markets." If it is true that negative externalities of financial crisis affect in a particular region affect other regions too then it is also true that some countries suffer to a bigger extent due to their weaker capacity for adjustment for globalization costs"(Bertucci & Alberti 2003). Therefore, every state experiences different impact from international finance that is unique to its financial markets.

Globalization/neoliberalism has infiltrated into political powers of different nations. This has manifested by the formation of supranational organizations that further the emergence political globalization. Thus, propelling the argument of globalization critics that democracy all over the world is under attack as existing national self-government are being defeated by global governance which is perceived less democratic. "Rapid reach in the influence of global governance has raised concerns among citizens and political scholars on the lack of accountability in global politics" (Goodhart 2011). Neoliberal politics, in essence, undermine the democracies of party states by idealizing purchasing power as a medium of influence thus disempowering the middle and low-income brackets and the operations of global politics affect democracies of party states in different ways based on how strong they are perceived to be in the global arena.

From this discussion its evident that globalization/neoliberalism has traversed all nations and has caused immense changes in the said states. The effects despite affecting all states are different both in degree and nature. This is because of the uniqueness of the fundamental characteristics of the states. The economic, political, cultural and financial frontiers of various nations are different more so, where such states have had little interaction with each other. Therefore, in an attempt to adjust to the undeniable move towards globalization the states experience different effects irrespective of their proximity to each other.

Globalization and neoliberalism are concepts that seem to intertwine such that it becomes hard to draw a clear line between the two. "Some authors argue that neoliberalism is the main driver of globalization and that globalization itself can be seen as both the effect of, and the move towards, global neoliberalism" (Litonjua 2008). The two case studies' ideology at the root of all our problems give a better insight into these concepts. The cases bring forth the facts that globalization has been widely acknowledged both in history and spread across the global sphere. Neoliberalism, on the other hand, seems to take a rather subtle approach and is even seen as anonymous as most people seem to be unaware of its dynamics. From the case, it's undeniable that the two have caused ambivalent reactions, especially in the political and economic realm. Nevertheless, the two seem to be analogous in their effects.

Normative political scientists held the ideology of clear delineation between states such that bounded communities developed independently of each other. With each being a "sufficient cooperation for all aspects of human life" (Rawls, 1993). This means that state did not have the need to set up rules for interstate relations. The lawlessness that results from this means that Fundamental normative ideals stood a better chance of success in the domestic arena compared to the global frontier. This ideology has however come under scrutiny as legal and political parties try to piece together the effects of globalization. As domestic and foreign and domestic become deeply intermeshed it is more difficult for domestic ideals to be successful without implementing the same in the global arena. In the case study on globalization, cosmopolitans suggest that the solution to this would be strengthening existing transnational sovereigns to improve interstate relations and provide solutions to problems of globalization. The case study on neoliberalism seems to support the cosmopolitan's view as international organizations, IMF, WTO, World Bank and Maastricht Treaty, have been used to implement neoliberal policies often in disregard to democratic authorities.

In both case studies, the concept of increasing inequality is a fundamental effect of globalization/neoliberalism. The insistence by neoliberals for deregulation seems to be a ploy by the rich and powerful to widen the already wide gap between the rich and the poor. This is because the policies under neoliberalism tend to eliminate protection on lower ranked groups of the society. This policy includes freedom from collective bargaining, freedom from environmental regulation and freedom from tax all which leave the poor and middle class disadvantaged. The case on globalization also brings out the fact that different interaction between states has brought about inequality not only between people but also among nations. However, there exists a divide between communitarians and cosmopolitans on the cause and possible solutions to the inequality problem.

Both case studies point to the fact that democracies are slowly losing their power and influence as global politics take over. This raises concerns, especially for political scholars and citizens. Global operations are lawless and therefore impose little accountability on participants. This is perceived negatively as it means as now more than ever nations will be exposed to exploitation with little or no avenues for redress. On a positive note though this has meant that activism against pertinent issues goes beyond local boundaries as through communication channels more people can participate. Since neoliberals focus on efficiency in capitalism and ignore the needs for social safety nets it leaves the low and middle-income earners at a disadvantage since there is little accountability on multinational operations. Worse still are the effects likely to be caused by inadequate regulation of the environment. Given the already bad state of global warming lack of accountability will only exacerbate the situation.

The case studies show that neoliberalism and globalization operate within the same dynamics of interaction between states. Their effects on different nations are yet to be fully recognized or realized. With massive innovation in communication and transport, the influence of both has accelerated in the recent past more than any time before.


Bertucci, G., & Alberti, A. (2003). Globalization and the Role of the State: Challenges and Perspectives. Reinventing Government for the Twenty-First Century, State Capacity in a Globalizing Society/Rondinelli DA, Cheema G. Shabbir (editors).-Westport, Connecticut (USA): Kumarian Press Inc, 17-31.

Chirico, J. (2013). Globalization: prospects and problems. Sage Publications.

Dhanapala, J. (2001). Globalization and the Nation State, A Cartography of Governance: Exploring the Role of Environmental NGOs. Colorado Journal of International Environmental Law and Policy.

Goodhart, M. (2011). Democratic accountability in global politics: Norms, not agents. The Journal of Politics, 73(1), 45-60.

Kotz, D. M. (2002). Globalization and neoliberalis...

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Effects of Globalization and Neoliberalism on States. (2022, Mar 29). Retrieved from https://proessays.net/essays/effects-of-globalization-and-neoliberalism-on-states

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