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Globalization and Global Systems Analysis

Since the early 1960s, mounting empirical pressure has forced sociology to abandon the assumption that national societies could be understood without looking beyond their borders. The nationstate remains a crucial unit of analysis, but it must be analyzed as intertwined with the operations of a larger global social system. Global flows of culture, technology, people, goods, and capital determines to an ever larger degree how societies change at the national level. The dynamics of transnational social, economic and political structures have become a focus of study in their own right.

The value of international trade has grown more rapidly than the value of goods and services produced and sold within national boundaries. Manufacturing means assembly of components from around the globe. Electronic youth culture in the United States revolves around Japanese cartoon characters, while a generation of Third World television viewers take their cultural cues from North American TV serials. Capital markets operate around the globe and around the clock as trading moves from Tokyo to London to New York over the course of each day. Sociologists cannot yet claim to understand the working of this global system, but a number of fruitful avenues of analysis have emerged since about 1960.

The approaches favored by sociologists have differed from the study of ‘‘international relations’’ as it has been traditionally defined. International relations approaches have seen the global system as structured primarily by interactions in which nations are unitary actors (see Waltz 1979). The global system is presumed to be structured largely by the distribution of national power among the advanced nations. Sociologists, on the other hand, have been very interested in how the global system is structured by flows of resources, people, ideas, and attitudes across geographic boundaries, flows that often occur without, or even in spite of, national actors.

Within sociology itself, ‘‘globalization’’ has been transformed from a relatively narrow field of study, largely within the political economy of development, to a central theme across a wide range of subfields within the discipline. The topic of globalization has also often drawn sociologists into interdisciplinary debates with political scientists, anthropologists, geographers, and even occasionally economists, among others. As recently as the late 1980s, a number of central approaches to global systems analysis could be identified—Marxism, modernization theory, dependency theory, and world-system theory. However, although these research traditions continue to be elaborated, studies of globalization have proliferated and research perspectives have become fragmented. This article reviews the early and continuing contributions of these perspectives and outlines the main themes that current global systems analyses are exploring.

Marxism and Modernization Theory

In the years after World War II, Marxism and modernization theory debated vigorously the problems and consequences of capitalist development. However, despite their ideological opposition, they shared some basic assumptions regarding the character of this development. In particular, they shared the assumption that the global system is dominated by processes of diffusion. In the words of the Communist Manifesto, the expansive character of capitalist production ‘‘draws all, even the most barbarian, nations into civilization.’’ Warren (1980) argues from a Marxist perspective that it is only by the expansion of economic ties to core countries, principally in the form of importing more foreign capital, that poor nations are likely to be able to reduce the gap that separates them from rich nations. Sklair (1991) argues that a world-system organized through nation states is being superseded by a ‘‘global system’’ dominated by transnational economic, political, and social structures. He points to the emergence of a transnational capitalist class that organizes the world economy to its own benefit, in contrast to the world systems view of contending national capitalist classes (for an empirical study, see Bottomore and Brym 1989). Robinson (1998) argues that sociology must move beyond nation–state based analytical approaches to make ‘‘transnational social structure’’ its proper object of study, since individuals are predominantly defined by their position in such transnational economic, political, and cultural structures rather than by national or local characteristics—transnational structures dominated by capital. Other Marxistoriented theorists emphasize the irrationality of capitalist competition on a global scale, since competition between national capitalisms creates a crisis of profitability for capital due to global overcapacity, which in turn leads to declining conditions for labor (R. Brenner 1998; Walker 1999). Nonetheless, the emphasis remains the dilemmas of the diffusion of capitalism—the fact of that diffusion is presumed.

Investigating the prevalence of that complex of ideas and attitudes associated with ‘‘modernity’’ provided an important impetus for modernization theorists to take a global look at the diffusion of culture and social structures. In a classic study, Inkeles and Smith (1974) analyzed the attitudes of citizens in six Third World countries spread around the globe. Modern attitudes were found in social contexts more characteristic of advanced industrial countries. The more time respondents had spent living in cities or working in factories, the more their attitudes resembled those associated with the culture of advanced industrial countries. The findings suggested a global system structured largely by processes of diffusion. The implicit model was one of gradual convergence around a similar set of ‘‘modern’’ values and attitudes. The spread of modern social institutions helps inculcate the values and attitudes, and the values and attitudes reinforce the institutions.

The work of Meyer and associates (Meyer 1980; Meyer et al. 1997a) shows how ideas and institutions originating in the advanced industrial countries become embodied in a global culture, which in turn shapes local institutions in all countries. Beginning from the surprising homogeneity of national political and economic institutional forms around the world, Meyer and associates (1997a) argue that contemporary actors, including nation-states, organize and legitimate themselves in terms of highly rationalistic, universalistic, world-cultural models. These models largely conform to the prescriptions of modernization theory, with core values such as citizenship, rationality, socioeconomic development, and so on. These models are diffused through the world system largely through the organizations and associations of ‘‘world society’’—intergovernmental and nongovernmental transnational organizations which act to promote a ‘‘shared modernity’’ rooted in scientific rationalism and in which scientists and professionals are particularly dominant (Boli and Thomas 1999; Meyer et al. 1997a). Nation-states are not destroyed by globalization but, in contrast, the nation-state cultural form is diffused around the world through the institutions of world society.

An extensive body of empirical work has been developed in support of these theoretical insights. Boli-Bennett (1979), for example, examines the way in which national constitutions reflect global legal norms rather than local conditions. Ramirez and Boli (1982) look at the ways in which schools take on similar shapes around the globe as conceptions of what constitutes an effective educational institution come to be shared with surprising speed across geographical boundaries. Meyer and associates (1992) argue that world-society connections diffused mass education to former colonies, rather than education systems developing simply as a function of level of economic development. Meyer and associates (1997b) examine how a world environmental regime emerged in recent decades through world-society associational processes, facilitated by the statelessness of this world society.

The interaction of these world-cultural forms with local contexts is unclear, however, as Meyer and associates (1997a) argue that there may be significant ‘‘decoupling’’ of these symbolic forms from the social practices in each contexts. Escobar (1995) argues that development discourses have relied exclusively on Western knowledge systems to the extent that non-Western knowledge systems are inherently marginalized by these ‘‘modernization’’ discourses. Ferguson (1990) shows that in Lesotho, the effect of modernization-inspired development policies was not to produce development but to depoliticize poverty and the further entrenchment of the state and Western modernizing influences. Other empirical work suggests that there are in fact a number of contesting models of the global economy, implying a more conflictual process than that depicted by Meyer and associates (Wade 1998).

Other social theorists take a more critical view of modernization while still placing the condition of modernity at the center of their analyses. Beck and associates (1994) have argued that advanced industrial societies are undergoing a new ‘‘reflexive modernization’’ that is closely tied to globalization. These authors see modernization bringing increased control over nature and society, as orthodox modernization theory predicts, but further rounds of modernization generating problems based precisely on its own success. The advance of rationalism and scientism remains central to their theories, but they are more skeptical about the ability of the experts to anticipate or control the side effects of their innovations. Pollution and other ecological disasters are critical political issues but also examples of how technical and social change can result in unanticipated system-level crises.

Giddens (1991) argues that modernity is inherently globalizing. Both are linked by the process of ‘‘disembedding’’—the lifting out of social relations from local contexts of interaction. There are two main mechanisms of disembedding: symbolic tokens (universal media such as money) and expert systems (bodies of technical knowledge that can be applied across a range of different contexts). Each produces a homogenization of social life across different contexts and relies on trust in absent repositories of expertise. With this trust, therefore, comes a strong element of risk, a risk that is an inherent element of the globalization process.

Beck (1992) places risk squarely at the center of his approach. For Beck, the populations of the advanced capitalist countries are living in a postscarcity age where the major dilemmas are the side effects of success. Risks such as pollution are also inherently global in that they are not limited to the local contexts in which they are produced and also in that they have a tendency to affect all members of society relatively equally. We are also becoming increasingly conscious of these risks and therefore of our global interdependence with other societies. There is a new politics of risk—a politics that is concerned with the distribution not of ‘‘goods’’ but of ‘‘bads,’’ a politics that is not limited by territory and in which multiple groups of experts struggle to legitimate their expertise as the potential solution to risk management.

The globalization of modernist worldviews and their primary agents—scientists and professionals— is once again placed at the center of the analysis. However, Giddens and Beck add an understanding of the dilemmas associated with such globalized rationalist institutions. Lash and Urry (1994) point up the postmodernist emphasis on aesthetic symbols and signs, in contrast to the modernist emphasis on rationalism and the power of scientists and professionals. They direct our attention toward cultural consumption on a global scale rather than toward the diffusion of rationalist worldviews and their effects.

Sociologists concerned with modernity and modernization emphasize the diffusion of rationalistic organizational principles (such as the nation- state form) on a global scale rather than the spread of global capitalism. Individuals are culturally constituted by the global system as rationalized, individualized actors rather than as workers or members of classes, while capitalists take second place to experts as the prime movers of the historical process of globalization. Nonetheless, theorists of modernization and modernity share with Marxists the view of an increasingly rationalized world, for better or worse.

Dependency Theory

In contrast, sociologists who analyzed the global system from a dependency perspective emphasized the extent to which Third World political economies evolve differently from those of First World countries because they confront a world dominated by already industrialized countries. Deriving their initial inspiration from economists such as Prebisch (1950) and Baran (1957), the dependency approach saw the global system as consisting of a ‘‘core’’ of advanced industrial countries connected both economically and politically to a larger ‘‘periphery’’ of poor nations, rather than as consisting simply of a set of nations that can be ranked along various continua according to individual characteristics such as size and wealth. The structure of the global system was conceptualized primarily in terms of trade and capital flows reinforced by political domination. The principal concern was with the consequences of these ties for social, political, and economic change in the countries of the periphery.

Cardoso and Faletto’s Dependency and Development in Latin America (1979 [1969]) is still the classic exemplar of this tradition. Their analysis shows that the way in which economic elites are connected to the global economy shapes not only their strategies of investment but also their willingness to make political alliances with other groups and classes. For example, Latin American countries whose primary ties to the core were formed by mineral exports under the control of foreign capital experienced a different political history from countries who relied on agricultural exports controlled by local elites.

The expectations of the dependency approach with regard to changes in the structure of the global system over time stand in sharp contrast to those of both traditional Marxist and modernization approaches. The dependency perspective emphasizes the ways in which economic elites and their allies in the periphery have an interest in preventing the full diffusion of economic capacities from core to periphery. For example, those who have an interest in the system of trading agrarian exports for core-country manufactures may consider nascent local industrialists to be competitors for both labor and political power.

Empirical work generated by the dependency perspective suggested that the consequences of core–periphery capital flows, rather than being the most important stimulus to the growth of the periphery as Marxists like Warren suggested, might in fact create obstacles to growth. Korzeniewicz and Moran (1997) show that overall world income inequality increased between 1965 and 1992, particularly in the 1980s—the most significant component of that inequality being between-country inequality. Initial cross-national quantitative analyses discovered that the buildup of stocks of foreign capital had negative, rather than the expected positive, consequences for growth (Bornschier et al. 1978; Chase-Dunn 1975). Firebaugh (1992, 1996), however, shows that the negative effects of foreign investment are in part a result of methodological problems with the analyses and that, while foreign investment is less beneficial than domestic investment, it has a generally positive shortterm effect on growth. Dixon and Boswell (1996a, 1996b) reformulate the dependency argument to emphasize the negative externalities associated with foreign investment that dampen the productivity of domestic investment. Kentor (1998) finds that dependency on foreign capital has particularly harmful effects on growth over the long term (thirty years) through the distortion and disarticulation of the domestic political economy. Crowly and associates (1998), in a review of crossnational quantitative studies in economics and sociology, find that foreign investment has a shortterm positive effect on growth but plays a more negative role over the long term. However, the dynamics through which foreign investment generates negative externalities within a political economy are not well understood (Dixon and Boswell 1996b). While the findings of these studies are still contested, they clearly demonstrate that the results of transnational capital flows are not those predicted by a simple diffusionist model.

The impact of trade liberalization has been just as controversial as that of foreign investment. O’Hearn’s (1990) longitudinal analysis of the Republic of Ireland shows that while foreign investment did not have a direct negative effect, free trade (which was inextricably tied to the foreigninvestment policy) had substantial negative effects on growth and inequality. Crowly and associates (1998) review studies of the impact of trade on growth and find that while export reliance is generally positively related to growth, this positive effect is reduced or reversed under conditions that approximate to those theorized as ‘‘unequal exchange’’ (Emmanuel 1972). Rodrik (1997), reviewing the economics literature, finds that unskilled workers are likely to experience increased labormarket insecurity in the face of free trade, that nations may have legitimate reasons to limit trade, and that national systems of social security are indeed threatened by trade liberalization.

Again, quantitative cross-national studies played a valuable role in specifying the consequences of industrializing in an already industrialized world. Chase Dunn (1975) found that a greater role for foreign capital was associated with high levels of inequality, and his findings were confirmed by a variety of subsequent studies (e.g., Evans and Timberlake 1980; Rubinson 1976). These studies also confirm the political consequences of global economic ties. Delacroix and Ragin (1981) show that peripheral status in terms of trade relations is associated with weak state apparatuses. Bornschier and Ballmer-Cao (1979) argue on the basis of cross–national data that core-peripheral capital flows strengthen the political position of traditional power holders at the expense of labor and middle-class groups.

One of the criticisms that can be leveled against the dependency approach is that it has focused too much on capital and not enough on labor. Whereas dependency theorists have been concerned with the consequences of transnational capital flows for labor in both periphery and core (e.g., Frobel et al. 1981), the tradition contains no series of crossnational quantitative analyses of either wage levels or the structure of international labor flows studies comparable to the literature on international capital flows. With some notable exceptions (e.g., Portes and Walton 1981) the global structure of labor flows and their consequences is understudied. The 1990s saw a series of valuable case studies of work under globalization, although the consequences of work organization patterns in shaping patterns of dependency has not been explored in detail (Bonacich et al. 1994; Hodson 1998; Salzinger 1997).

Even within a global economy that is becoming more polarized, there have been significant cases of upward mobility. Spain and Portugal, which once formed the core, later moved to the semiperiphery, where they are joined by Taiwan and Korea, which have moved up from the periphery (Korzeniewicz and Moran 1997). Although dependency theory has concentrated on the obstacles to mobility facing peripheral economies, it has also stimulated a wide range of research on the causes of mobility within the world-system. Analysts of ‘‘dependent development’’ (Cardoso 1974; Evans 1979) argue that intensification of ties with core countries is a dynamic element in reshaping the political economies of Third World countries. Dependent development shares with classic Marxist approaches the assumption that capital flows between core and periphery can play a significant role in generating industrialization in the Third World. It emphasizes, however, that both the economic character of this industrialization and its social and political concomitants are likely to be different from the experience of core countries.

The question of domestic dynamics is particularly important in relation to explanations of the mobility of individual nations from one position to another. While such mobility depends in part on changes in the system as a whole, it also depends on the outcome of domestic political struggles. In his work on Chile, for example, Zeitlin (1984) argues that the outcome of political struggles among economic elites in the nineteenth century was determinative of Chile’s retaining its role as an exporter of raw materials rather than moving in the direction of trying to transform its mineral resources into more processed exports. Zeitlin’s analysis of Chile shows how the outcome of domestic political contests can perpetuate peripheral status.

Brenner’s ( 1976, 1977) interpretation of England’s rise to the core provides another example of the domestic roots of systemic mobility. In Brenner’s view, the differences between the agrarian strategies of England on the one hand and Spain and Portugal on the other were not simply the result of trade possibilities generated by changes at the level of the world-system. They depended crucially on interactions between peasant communities and agrarian elites at the local level, which in turn were rooted in longstanding historical characteristics of the peasant communities themselves.

Likewise, Taiwan and Korea are used as examples of the way in which internal dynamics may allow construction of more effective state apparatuses, which in turn enable a country to improve its position in the global system (Evans 1987). In the East Asian developmental states, and especially in Japan and Korea, the state sat at the center of an alliance between the large business groups, domestic banks, and certain key state agencies— prodding and poking firms and banks in more developmental directions, organizing political alliances, and mobilizing social resources (Amsden 1989; Evans 1995; Wade 1990). Research stimulated by the dependency perspective has been both a powerful corrective to views of globalization as an inevitable, relatively even process of diffusion from the core to the periphery. Recognizing the obstacles to diffusion has also problematized the cases where mobility has occurred and has focused analysts’ attention on the forces shaping a nation’s ability to overcome these obstacles.

World-System Theory

The dependency approach’s contribution to our understanding of the international system has, however, been limited by the fact that it does not focus directly on the structure of the global system itself. The ‘‘world-system’’ approach, launched by Immanuel Wallerstein (1974) and others (see Chase- Dunn 1989) at the beginning of the 1970s, took the overall structure of the system as its starting point. Wallerstein’s contribution lay not only in directing attention to analysis of the global system itself, but also in setting the contemporary capitalist worldsystem in the context of previous systems spanning more than one society.

In Wallerstein’s world-system, the hierarchical structure is postulated as essential for its survival. The geographic expansion of northwestern Europe’s economic and political influence beginning at the end of the ‘‘long’’ fourteenth century was, in Wallerstein’s view, essential to the transformation of productive organization in that region. Subsequent interchange among regions with different modes of extraction has been central to sustaining the process of accumulation in the system as a whole. Wallerstein envisions at least three structural positions within the system. Defined in terms of the nature of their exchange relations with other regions, they are

(1) the ‘‘core,’’ which exports goods produced by processes more intensive in their use of capital and new technology;

(2) the periphery, which relies on the production of labor and resource-intensive goods; and

(3) the semiperiphery, which ‘‘trades both ways’’.

Arrighi (1994) emphasizes the role of finance in the worldsystem as a complement to the Wallersteinian focus on trade and the division of labor. He traces the process of capital accumulation across four systemic cycles of accumulation in the world-system. Each one is associated with a different hegemonic (state) power that coordinates the securing of the conditions for capital accumulation on a world scale.

Quantitative cross-national analysis provides support for the idea that countries can be categorized according to their interactions with other nations and that countries in the same position experience shared benefits (or costs). Snyder and Kick (1979), using ‘‘block modeling’’ techniques, found a block of nations whose characteristics corresponded roughly to those of the core, several blocks that corresponded to the periphery, and a set of nations with the intermediary properties attributed to the semiperiphery. Smith and White (1992) used a similar methodology but improved on Snyder and Kick by examining longitudinal changes in the structure of the system. They were able to demonstrate changes in the structure of relations within and between blocks of nations and chart the mobility of individual nations within the system. Van Rossem (1996), however, using an analysis of the role structure of the world economy, argues that world-system position has little direct effect on growth but is better seen as a framework within which nations can act rather than as a determining force in national economic development.

Some of the most interesting work stimulated by world-system thinking has involved analysis of systems that antedated the emergence of the contemporary one (e.g., Abu-Lughod 1989). Wallerstein argues that systems prior to the current one were primarily of two types. ‘‘Minisystems’’ extended across boundaries defined by unified political control and ethnic solidarity but did not come close to being global in scope. These minisystems have been the subject of a number of recent studies, with interesting comparisons across different worldsystems (Chase-Dunn and Hall 1997; Chase-Dunn and Mann 1998). ‘‘World empires’’ joined various ethnic and social groups in a single division of labor by extending political control over a broader geographic area. Only the contemporary capitalist world-system, however, unites such a broad geographic region (essentially the entire globe) in a single division of labor without unified political control of corresponding scope. Frank (1998) has challenged the Eurocentrism of world-systems theory, arguing that the Western European capitalist heyday is but an interlude in the dominance of Asia in the world economy. Arrighi and Silver (1999) compare the contemporary period to the two major hegemonic transitions—from Dutch to British power in the 1700s and from British to U.S. power in the early twentieth century . They argue that the financial expansion of the last two decades of the twentieth century, is not so much a sign of deepening globalization as of systemic crisis, with an uncertain outcome which depending largely on the response of the declining hegemonic power, the United States. The comparative perspective across geographic scales and historical time periods that world-systems theory can provide gives valuable insight into the novelty or otherwise of contemporary globalization processes.

Another interesting trend in current sociological work on the global system is the increasing concern of sociologists with the politics of international relations among states. The third volume of Wallerstein’s (1989) epic analysis of the modern world-system makes it clear that the world-system perspective, often accused in the past of being excessively ‘‘economistic,’’ is now focusing much more on the logic of interstate politics, an emphasis that is also central to Arrighi’s work. At the same time, other major sociological figures have turned their attention to the political and military aspects of the international system (e.g., Giddens 1985; Mann 1988; Tilly 1992). There has also been some attempt within world-systems theory to incorporate the dynamics of households (Smith and Wallerstein 1992) and of social movements. The emphasis within the tradition remains firmly on structural, macro-level processes, despite an increasing attention to cultural constructions (Wallerstein 1990). World-systems theory does analyze how the core countries are affected by the development of the world-system—unlike in the previous perspectives. However, this analysis is concentrated on the struggle among core nations for hegemonic power within the world system. There is very little analysis of the impact of peripheral development, or even of globalization processes more generally, on the core within any of the perspectives discussed so far.

A quite different systems perspective on globalization has been advanced by Robertson (1992). Building on a concern to link a Parsonian concept of social systems to an analysis of international relations, Robertson posits that globalization involves the structuration of a social system at the global level. He argues that this process of globalization has been underway since the early fifteenth century and has resulted in ever-increasing global complexity within the social system. He shares with world-systems theory a ‘‘long view’’ of the development of globalization tendencies. However, he rejects the ‘‘reductionism’’ and ‘‘economism’’ of world-systems theory in favor of an analysis of the cultural and social conditions of social order within a global system. Robertson argues that there is an intensification of global consciousness in the sense that individuals increasingly orient toward the world as a whole. This rise in global consciousness is sustained both by the greater material interdependence of people around the world and by the interplay of four components of the global social system: the individual self, the national society, the world-system of societies, and humankind (1992, p. 27). The self-definition of each element can no longer be sustained in isolation from the other elements—under conditions of globalization each component is constituted relative to the others, providing the defining feature of globalization.

Current Global Systems Analysis

Each of the ‘‘classical’’ perspectives on globalization has therefore generated insights into the process and continues to sustain a research tradition of its own. However, the theme of globalization has spread beyond the confines of these traditions to become a central organizing concept across a wide range of sociological perspectives and research. Since approximately the early 1980s, globalization has had an increasingly visible impact on the core countries themselves, shaping the concerns of sociologists located in those countries. Sociology itself has been at least partially globalized—both by the emergence of ‘‘indigenous’’ sociological communities around the world and by the growing international communication between these communities (Albrow 1996). Previous eras of sociological research into the global system had been shaped by a concern for the impact of the core on the periphery. However, these new patterns of globalization and new locations and perspectives of sociologists have generated an interest in how specific components of that system are being rearticulated and in particular how the global, the local, and the national are being reconstituted (Waters 1995). This diverse body of research typically examines globalization by generating ‘‘theories of the middle range,’’ often as a reaction against what was seen as overly abstract or deterministic systems-level theories (Portes and Walton 1981). The diffusion of the concept of globalization through sociology and this concern for revealing the mechanisms of globalization were reflected in a fragmentation of perspectives in the 1990s. In the rest of this article, we will review some of this recent research, focusing on the issues of the globalization of production, the constitution of a ‘‘global culture’’ and the future of the state in a global economy.

Over the course of the 1970s and 1980s, a growing body of work emerged that took the influence of the global system seriously in its analysis of change at the domestic level while at the same time using analysis of domestic political struggles and their economic consequences to explain changing ties with the global system (see Evans and Stephens 1988). These attempts to integrate international and comparative analysis are not unique to sociology. A parallel trend can be observed in political science as well (see Gourevitch 1986; Putnam 1988).

In the 1990s, work on global and local production systems, while often informed by dependency theory, also took a somewhat different approach. Reich (1991) argues that ‘‘national champion’’ corporations are rapidly being transformed into ‘‘global webs,’’ or ‘‘virtual corporations,’’ that coordinate knowledge inputs from around the globe. Castells (1997) argues that the structural logic of society is increasingly expressed through a ‘‘space of flows’’ that stretches across the globe. Flows of capital, information technology, organizational interaction, images, sounds, and symbols are the expression of the dominant processes of global society. They are based on an electronic infrastructure, supported through key nodes or locations, and directed by a dominant, managerial elite. Most people continue to live in the ‘‘space of places’’ where local context dominates their experience. However, the space of flows tends to dominate the space of places as function and power are increasingly organized in flows while experience remains rooted for the most part in places (Castells 1997, p. 428).

Organizational theory suggests, however, that the model of the virtual corporation is likely to be problematic as home and host country effects, corporate cultures, and sectoral characteristics still shape corporate strategies in significant ways. Gereffi advances the concept of ‘‘global commodity chains’’ (GCCs) as the organizational structure that ties together these various social and institutional contexts in a global production network (Gereffi 1994; Gereffi and Korzeniewicz 1994; Harrison 1994). These GCCs are dominated either by key producers or by dominant brand name marketing firms, creating ‘‘producer-driven’’ and ‘‘buyer-driven’’ GCCs. The overall organization of the GCCs and location within the GCC shape workers’ wages, conditions, and power in the workplace (Bonacich et al. 1994).

This perspective therefore goes well beyond perspectives that simply warn about capital mobility and virtual corporations. It also allows us to provide more nuanced accounts of the dynamics involved in territories’ dependency on foreign capital, although the analysis of the political contexts of GCCs has not yet been fully developed. This more nuanced analysis of global production structures also holds the potential for improved integration of the role of domestic dynamics in determining the position of individual nations within the system and, by extension, shaping the structure of the system itself.

Increased attention is also being paid to how, even in an era of globalization, long-established patterns of interaction and cultural forms can profoundly shape a nation’s ability to compete globally. The success of Japan, Korea, and Taiwan can, for example, be argued to be due in part to the contribution of communitarian, patrimonial, and patrilineal cultural logics to creating the organizational networks that are at the heart of these countries’ economic success (Orrú et al. 1997). A country’s historically shaped ‘logic of social organization’ can make it better suited to competition in particular industries—for example, a more decentralized, less hierarchical culture such as that of the United States may be more suitable for industries, such as software, that are based on knowledge sharing (Biggart and Guillen 1999; Guillen 1994).

Theorists of ‘‘industrial districts’’ have made a somewhat different point regarding the importance of local social and cultural practices in shaping global competitiveness. They argue that in an era of post-Fordist production, where information processing is critical and the need for ‘‘flexible specialization’’ central to competitiveness, local face-to-face relationships are necessary to build up the trust that supports such competitiveness (Piore and Sabel 1984). Initial versions of this approach pointed to long-established civic traditions, craft traditions, and kin relations as underpinning such organizational forms, in Italy in particular (Piore and Sabel 1984; Putnam 1993). Later research has explored the emergence of such cooperation and trust in ‘‘new’’ regions, such as Silicon Valley (Saxenian 1994), Hollywood (Storper 1997), Southern California (Scott 1993), and numerous other regions identified in a huge range of studies (Castells and Hall 1994). Sabel has explored at a theoretical level how such ‘‘constitutional orders’’ can develop or even be promoted by policy (Sabel 1996a).

Sassen explicitly attempts to integrate these local and global perspectives through an analysis of how labor flows are shaped by capital flows (Sassen 1988, 1998), how ‘‘global cities’’ arise as centralized nodes of control over decentralized production systems (Sassen 1990), how domestic structures of inequality are created by the demand for high-wage professionals and low-wage service workers (Sassen 1988, 1990), and how the state comes to play a critical role in globalization, even as it is transformed by the process (Sassen 1996, 1998). She extends this analysis to begin to analyze the incorporation of women into the global economy and the opportunities and threats posed for them by this process (Sassen 1998). Sassen demonstrates the interaction between transnational corporate networks and labor flows and territorial entities such as global cities and local and national states in shaping global capitalism.

This creative tension between local and global is also visible in research on ‘‘global culture.’’ For many authors, the global reach of markets has brought with it the cultural construction of actors around the world as individualized consumers, often in association with the more general spread of U.S. cultural norms internationally (Barber 1995; Featherstone 1990; Ritzer 1993; Sklair 1991). Others see a reaction against this process in a return to‘‘tribalism,’’ in the increase in ethnic and nationalist conflicts and atrocities, and in the general struggle between ‘‘locals’’ caught in the space of places and ‘‘cosmopolitans’’ operating in the space of flows (Barber 1995; Castells 1997).

Each of these implies a vision of global culture as a homogenizing force, with local identites surfacing as a reaction against this domination or, in certain cases, exclusion. However, other authors emphasise how global cultural forms become transformed in the local culture and how local cultures form part of a more varied and heterogenous global culture. Appadurai (1996) argues that global cultural flows are shaped by the multiplicity of perspectives generated by flows of people, money, technologies, ideologies, and media technologies and symbols. Working through these varied cultural landscapes, local cultures work to incorporate global symbols but in ways specific to the local context. There is no pure local culture that is untainted by global culture but rather a variety of local cultures that are increasingly interpenetrated and constantly remade out of elements of global cultural flows (Appadurai 1996; Hall 1991).

Research on migration and transnational communities provides an opportunity to examine the interaction of local and global forces in shaping ‘‘global culture.’’ Hodagneu-Sotelo (1994) shows how migration can present opportunities for women to play a more central role in their communities and in mediating relations between the community and the state. Transnational communities of migrants emerge that may have huge economic and social impacts on the home and host countries by creating new identities and structuring flows of social and financial resources (Massey and Parrata 1998; Portes 1996). Another social group that has received much research attention, but rarely under the rubric of globalization, is professionals, who, as we have seen, are central to the process of globalization and are most likely to be integrated into global networks in the workplace (Reich 1991) or in their migration patterns (Castells 1997). Finally, research into virtual communities promises to provide insights into the nature of community and shared culture in an ostensibly placeless cyberspace (Turkle 1995; Wellman et al. 1996).

Finally, we turn to the state, which is often claimed to be a doomed social actor in the face of globalization as mobile corporations, finance, migrants, and symbols undermine its economic, political, and cultural authority (Esping-Andersen 1996). Furthermore, globalization is one factor shifting the focus of politics away from the state and established interests and toward ‘‘new social movements’’ organized around new identities forged from ‘‘codes’’ from around the world (Melucci 1996). A variety of research, mainly in political economy, has aimed to show the continuing national diversity in socioeconomic organization and the persistent power of the state to shape economic outcomes (Boyer and Drache 1996; Hirst and Thompson 1996; Wade 1996). Indeed, globalization has in many ways been produced by states. Sassen (1998) argues that the state has played a key role in creating the international and local conditions for global production and capital accumulation. States have negotiated new legal regimes that secure the rights of capital on a global scale and have supported the strategic sites through which the global economy is organized. Economic sociology’s improved understanding of the social and political construction of markets can be applied very usefully to the continuing national diversity in state–market relations (Berger and Dore 1996). Fligstein (1990), for example, shows the domestic conditions for the increased U.S. corporate emphasis on finance, an emphasis that, at the end of the 1990s, threatened the East Asian economies (Wade 1998). The particular property rights and exchange rules underpinning the construction of a single market within the European Union have also been profoundly shaped by interstate negotiations (Fligstein and Mara-Drita 1996).

Neil Brenner (1998, 1999) argues that state structures and strategies are being reconstituted in order to mediate the global and local processes discussed above. The ‘‘glocal state’’ attempts to promote the global competitiveness of its major urban regions through increased ties to both local and international actors. Sassen (1999) points out that this remaking of certain parts of the state apparatus to promote global competitiveness begins to shape the character of the state as a whole, as even those sections of the state still predominantly concerned with national social policy become accountable to the new priorities and as the national legal and institutional structure is changed to accommodate international capital. These processes are not inevitable, however, as the international hegemony of Anglo-American economic ideology contributes to the creation of a ‘‘leaner, meaner’’ state that retains the institutional capability to support capital even as its capacity to provide social services or to support civil society weakens (Evans 1997). This excessive global liberalization and integration of financial markets is likely to have a corrosive effect on domestic state capacities and social welfare (Block 1996).

The state is therefore remade by globalization, even as it plays a critical role in constituting the global economy. Sociologists are beginning to explore the implications of this reconstitution of the state for economic sovereignty and citizenship. Castells (1997) argues that a ‘‘network state’’ is emerging, a state in which sovereignty is pooled between increasingly intertwined local, national, and international levels of governance, such as in the European Union. Debates persist as to whether this network state means the eclipse of local or national institutions as European Union institutions increasingly come to predominate (Streeck and Schmitter 1991) or even as a ‘‘postnational society’’ is created in Europe (Habermas 1998). There are persistent examples within Europe, however, that local and national institutions continue to play a central role in generating economic and social progress. Recent examples include national corporatist institutions in the Netherlands (Visser and Hemerijck 1996), local ‘‘micro-corporatism’’ in Italy (Locke 1995; Regini 1995), and a combination of the two in the Republic of Ireland (Sabel 1996b).

States are clearly being transformed by both the localization and globalization of economic life. Boyer and Hollingsworth (1996) argue that economic action is best conceived of as ‘‘nested’’ within a combination of local, national, and international institutions, rather than as ‘‘embedded’’ within national regimes. Indeed, formal sovereignty is shifting away from the state in many cases—toward both privatized transnational legal regimes (such as international commercial arbitration) and increasingly legitimate international human rights codes and instruments. These developments are also transforming the character of citizenship—on the one hand weakening certain provisions around economic and social citizenship (Sassen 1996) while on the other universalizing certain human rights (Soysal 1994). In short, then, the state remains a vital actor within the global system but one whose role, purpose, and structure are being transformed in new and unexpected ways.

Sociology itself is being transformed and globalized, if only partially up to this point. In the process, global systems analysis has moved from the specialization of a number of key theories to perhaps becoming a defining element of sociology in the twenty-first century. New methodologies are being developed to counter the abstraction of systems analysis and to provide insights into the process of globalization as revealed in local contexts and as practiced by social actors (Burawoy et al. forthcoming). What new theoretical and methodological traditions will emerge from this period of change remains unclear. Overall, our understanding of the global system must still be considered a project ‘‘under construction’’ rather than a finished set of tools easily applied to specific problems.

This is all the more true given the rapid changes in the global system itself. Some things are clear nonetheless. We know that trajectories of change in national societies cannot be analyzed without reference to the global system in which they are embedded any more than the analysis of change in individual communities can be attempted without awareness of the national society in which they are embedded; but we also know that the character of relations between an individual state and the larger system is shaped not just only by the evolution of the global system but also by the outcome of political struggles at the local level. We know that the nations located at the bottom of this structure are disadvantaged economically as well as politically, but we also know that mobility is possible. We know that diffusion of ideas and norms throughout the global system has a powerful influence on how social institutions are structured in individual nations, but we also know that this diffusion takes place within a system that has a very hierarchical structure. Increasingly, we understand that local societies incorporate global cultural forms in complex and contested ways.

We know that the contemporary global system is an invention of the last half-dozen centuries; predicting how long it will endure is another question. For some, the future seems gloomy as the market threatens to undermine both state and society and lead to barbarism, as Polanyi (1944) suggested. For others, the future holds the possibility of the re-creation of civilizing institutions on a more comprehensive global scale. Still others seek to identify spaces for action within globalization processes, hoping to shape alternatives to the pessimistic Polanyian vision of creeping barbarism.

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