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Globalization causes profound effects all around the world.

Select one
type of globalization and compare its impacts in two countries.

Economic globalization is a highly multidimensional and complex concept


involving and affecting may portions of socio-cultural, political and
economic constructs of humanity. Despite this highly complex nature
many scholars agree that it is the increasing interconnection of world
economies as a result of the expanding trade of merchandises and
services, flow of transnational assets and extensive and rapid
dissemination of technologies. China and Australia are two major
economic powers in the world that implement differing policies on the
state of the economic nation in regards to globalisation and transnational
movement of products. While economic globalisation has had a major
impact on the domestic economies, trade and investment of both these
countries it is their differing policies and worldviews that play a more
significant impact to not only the countries own economic benefits and
hindrance in relation to the ever increasing global economy but the sociocultural aspects of the country will be impacted in different ways
depending on the type of economic worldview established. These differing
worldviews are established through their own domestic economic policies,
with China taking a neo-mercantilist view with the government owning the
majority of power in the economy compared to Australia taking a
neoliberalist approach to their economy with more emphasis on
privatisation and free trade. Using this statement of opposing worldviews
and domestic economic policies causing a significant impact on the global
economy, this paper will examine the foundations of neo-mercantilism and
neoliberalism in an attempt to assess the impact these worldviews and
policies have had in establishing their economic power. Using both
statistical data and socio-political opinions and constructs of scholars, I
will examine how these differing worldviews have had both positive and
negative impacts on the domestic economies of both Australia and China
themselves and in relation to the global economy.
Neo-mercantilism is the economic policy where capital movement, exports
and currency decisions are highly encouraged and largely controlled by
the central government to protect domestic industries along with high
tariffs and minimal imports (Song 2012). The overall objective of neomercantilism is to inherently imply an overall increase in economic
globalisation while still maintaining the domestic economy as the number
one priority (Kuncheva, 2013). This economic policy has been observed in
China over the last 30 years and has had significant impacts both socially
and economically. The economic impacts of this policy become highly
evident in China, as when viewed from the perspective of globalisation
Chinas economic transformation has sustained rapid growth over a period
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of time where the Western worlds economic power and growth remained
stagnant (Lo and Zhang 2009). This heavy reliance on global exportation
with the neo-mercantilist economic worldview has been critical to Chinas
development as a global economic power. Along with this, the expansion
of domestic supply and exportation as a result have resulted in significant
impacts on Chinas development of its own domestic economy, and as
noted by (Cwik 2011), this exportation and trade surplus of domestic
supply is in line with a neo-mercantilist view and recognises the
governments selfish view of their own economy while implying the trade
is functional to imply China's catching-up and to enhance its
international status within the global economy while simultaneously
continuously focussing on its own domestic policies and increasing these
economic impacts. Schortgen summarises this to say that although the
economy may be increasing as a whole internationally, the principles and
rules of the economy still remain under a western ideology and thus have
impacted the globalisation of the economy despite Chinas significant
growth. He emphasises that even under economic antagonism,
acknowledging the shift in economic powers is necessary to achieve
cooperation, and true economic globalisation.
This is in stark contrast to Australias neoliberal economic policies which
proclaim that the global economy should be a free and open market
where according to Thorpe the increased globalisation has been positively
correlated with an increase in foreign direct investment (FDI), economic
growth and linkages in the private market. This in turn has had a
significant impact on Australias own domestic economy especially
through the duopoly of the supermarkets with Coles and Woolworths.
Despite being owned by the public trading companies, Wesfarmers and
Woolworths ltd respectively they are both non-governmental and
privatised organisations playing a major role in enhancing the countrys
economy. Wade specifically states the the more open and liberal a
countrys domestic economy is the more prosperous they will become and
the more globalised they can be. This is highlighted in Australias
domestic economy with the two major supermarket powers being a nongovernmental yet publically traded company has a major role and when in
periods of low upturn and profit, the economy as a whole is significantly
lower rates and can even be in a recession. This is again proven in
Thorpes work as he takes a neoclassical approach to this and shows that
when Australia is at a low peak of trade between private organisations
and thus low globalisation it is apparent that the economy is in a recession
compared to high trade periods of expansion. They also conclude that in
order to thoroughly understand the economic growth of Australia it must
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be analysed with both socio-cultural and political aspects on global


integration.
These differing views on economic power and globalisation also have a
significant impact not just on the statistical economic factors but also on
the socio-cultural and political impacts on society. This is explored by
Crane (1999) who uses Benedict Andersens controversial thesis and book
Imagined Communities where he related the theme of national identity
to the mercantilist view of the Chinese economy. Through studying this it
can be seen that economic globalisation in a neo-mercantilist view and
how through government persuasion, an imagined domestic economy
can be realised and further used to increase their global economic power.
This would be extremely difficult to occur without the neo-mercantilist
view China has established through its economy and thus onto society.
Crane further explores this by highlighting that the increasing economic
globalisation due to the Chinese worldview is no longer diametrically
opposed to national identity that has been placed on society. They in fact
both intertwined and influence each other greatly. This is further adapted
by (Ching 2011) who argues that the adoption to the World Trade
Organisation (WTO), whilst still maintaining their neo-mercantilist view of
high export, low import and mostly government controlled has placed a
highly significant impact on the socio-cultural aspects of China and has
allowed for more entrepreneurship to further increase the economic
impact on globalisation. He further explores this that despite maintaining
their neo-mercantilist view on the economy the trade networks specifically
relating to exporting materials has been adopted via the US model and
thus further increased their globalisation. Schortgen however criticises
this and summarises the impact to say that although the economy has
increased a whole globally, it still remains under a western ideology and
despite their major growth until China changes their worldview from a
neo-mercantilist perspective, their society will find it difficult to cope with
the ever increasing economic globalisation of the western economic
ideology.
This difference in worldviews of the economy and its role in globalisation
are again highlighted against Australias neoliberal policy. Many scholars
including Pick and Taylor highlight that the neoliberal economic policies
shape the worldview of many recent graduates. These stances are taken
from the US and UK economic policies. Using this socio-political constructs
and statistical data they were able to determine that economic rewards
are the driving factor framed in a neoliberal conception thus shaping the
attitude of recent graduates into a self-governing culture and
determining that neoliberalism is extremely influential on the minds but
not entirely ubiquitous. This impact and influence a global neoliberal
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economy has on the educational views of recent graduates is further


highlighted by (Pasura 2014) who specifically focusses on VET training and
teaching in Melbourne. He highlights that the neoliberal policy crossed
from the US and UK economies plays a significant role on both the
teaching of VET courses and the students who graduate from these
courses. He highlights that this neoliberal framework and mindset place
significant emphasis on the teachers to teach privatisation regarding their
TAFE courses and the students to adopt a mindset about working in a
privatised industry rather than a public or governmental industry to obtain
a global standard in trade work economies (Pasura 2015). Despite this
however the neoliberal mindset has its disadvantages in social aspects as
well, as (Mirowski 2008) challenges this by noting that a neoliberalist
frameset and worldview asserts itself that there is no alternative, this is
simply a way of manufacturing consent rather than a factual statement.
Thus it can be concluded that a neoliberalist framework and policy on the
economy is only beneficial when society succumbs to its policies and is
further extended through ever increasing economic globalisation of
neoliberal powers.

In conclusion globalisation, specifically economic globalisation is difficult


to define due to it being multidimensional not just incorporating the
economic factors but many scholars agree that it is the cross linkages
between financial markets and is a highly transformative and impactful
process often instigating growth and development as well as employment
opportunities. However it cannot do this without a certain framework
established in the globalisation and economic process, such as a
neoliberalist or neo-mercantilist worldview/framework of economic
policies. It has been argued that these economic policies and frameworks
are what shape the younger generation and skilled labourers in their
benefit to the economic growth of the country. It is also noteworthy by
many scholars that without economic globalisation, there would not be a
competitive amongst domestic workers, but also amongst workers
internationally. However its impact is significantly different depending on
the worldviews and economic frameworks and policies across various
countries. By analysing the difference between a neoliberalist and neomercantilist economic framework and worldview we can see the
significant difference in impact it has had not only across the domestic
environment and economy, but the global economy as well. Using these
social and analytical constructs it is easy to see both the positive and
negative effects that the differing frameworks of neomercantilism and
neoliberalism have on both the economy globally and the social aspects
domestically especially in China and Australia. Overall however academics
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remain polarised over which domestic economic policy is greater as there


are advantages and disadvantages for both the globalisation of their own
domestic economies as well as the different attitudes in society it creates,
but they all find it relatively easy to see the significant impact
globalisation has had across a number of countries across the world in
relation to the economy and the society. In summary globalisation is a key
factor in maintaining a proper economy and each countries domestic
economy and society are both affected by the ever ongoing global
economic process.

References
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