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Some Contemporary Issues in Economic Sociology :- Development; Globalisation

THE NATURE AND MEANING OF SOCIAL DEVELOPMENT

Development is a broad concept and, though interrelated, it differs from social change. Change is a value-
neutral concept whereas development is a value-laden concept. The notion of development is, in other words,
the process of desired change. All cases of change do not indicate development. Only planned and desired
changes can be described as development. Thus, it is important to keep in mind the distinct character of the
concept of development.

Social development refers to the overall transformation of individuals and society, which may enable every
person to achieve moral, social physical and material well-being.

The Three Worlds of Development

1.The First World consist of North America, Western and Southern Europe.
2.The Second World had consisted of Soviet Union and the East European group such as, Poland, East Germany,
Hungary etc.
3.The Third World was and to certain extent still is generally used to refer to the less developed or developing
societies of Asia, Africa and Latin America.

1. The Capitalist Model of Development of the First World

The main characteristics of the capitalist model of development are:

a) provision for private ownership of property and means of production,

b) promotion of economic activities through private enterprises, and
c) minimum possible state regulation and control on private enterprises. Thus the capitalist model is
characterised by a free economy regulated by competition.

B. The Socialist Model of Development of the Second World

The socialist path of development adopted by the Second World, was seen to be opposite or
dichotomous to the capitalist path of development. The former, contrary to the latter, is characterised by
state ownership of property and means of production, public enterprises and complete state regulation of
economic activities. Thus, the socialist model refers to a regulated economy.

The main allegation against the capitalist model is that, since it permits minimum state regulation, its
economic system becomes exploitative in the sense that the working class people (proletariat) do not get
their due share. The capitalists enjoy a major share of the nation’s resources. Hence it contributes to
inequalities so that a few are very rich and the majority is very poor.

C. Development of the Third World

Third World countries as there are variations among them, dictated mainly by their historical and socio-
cultural circumstances. What they seem to share in common is that:
a) They are economically and technologically underdeveloped in comparison to the countries of the so
called developed world.
b) Social planning is a key element in their development process. Their plans of development incorporate
not only economic concerns, especially removal of poverty, but also concerns regarding nation building,
national culture and social transformation.

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 c) They have been seeking technological and economic aid from the developed countries. The developed
countries have given them economic assistance, but they have also been increasingly attempting to
extend their political influence in the developing countries. It has been noted that the global military
defence strategy is, the major consideration of the developed countries, in extending their economic and
political influence to the developing countries.

MEANING OF GLOBALIZATION
The term Globalization has been used to define various aspects of global expansion in the past
decades. It is centred on the integration of international markets for goods, services, technology, finance and
labour. This essentially means opening up of national economies to global market forces and corresponding
reduction in the scope of state to shape macro-economic policies.
Antony Giddens, a Sociologist, defined globalisation as an intensification of worldwide social relations, via
which faraway places are linked together in such a way that those events in one place are affected by a
process taking place many miles away and vice versa.
Globalisation has resulted in:
• • increased international trade
• • a company operating in more than one country
• • greater dependence on the global economy
• • freer movement of capital, goods, and services

THE CONCEPT OF GLOBALIZATION

The process of globalization is not new. But earlier the pace of such a process was so slow that we hardly
noticed it. However, now with the advent of the information technology, newer means of communication have
made the world a very small place. Not only the pace of the globalization process, but the penetration and
integration of the changes induced in our day to day life has made the impact of globalization many fold
higher. With this process the world has become one huge market place.
The term “globalization” began to be used more commonly in the 1980s, reflecting technological advances
that made international transactions easier and quicker —both trade and financial flows.

There are several key factors which have influenced the process of globalisation:

1.Rapidly changing technologies for transportation and communications continue to dissolve the barriers of
time, distance, and ignorance.

2. Freedom of trade - organisations like the World Trade Organisation (WTO) promote free trade between
countries, which help to remove barriers between countries.

3.Labour availability and skills - countries such as India have lower labour costs and also high skill levels.
Labour intensive industries such as clothing can take advantage of cheaper labour costs and reduced legal
restrictions in LEDCs.

4. Ideas also shape globalization, particularly the widespread belief that free trade, private enterprise, and
competitive markets promote efficiency and economic growth.

In the late 1980s, due to poor economic performance under protectionist policies and various economic
crises, many developing countries began to dismantle their barriers to international trade. Globalization
process has sped up with the increasing usage of Information and Communication Technologies (ICT).
Greater awareness of markets and knowledge of Capital resources have opened up International
competition and trade.

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IMPACT OF GLOALIZATION
The impact of globalization on the society is multi-dimensional and all-pervasive. The broad reach of
globalization easily extends to daily choices of personal, economic, and political life. Globalization can also
create a framework for cooperation among nations on a range of non-economic issues that have cross-
border implications, such as immigration, the environment, and legal issues.

At the economic level, there is a trend towards increasing economic liberalization. There is a marked
increase in exports of goods and services in which nations have their respective competencies.

One of the major impacts of globalization in the political sphere is that it reduces the importance of nation
states. Many have organized themselves into trade blocs. Emergence of supranational institutions such as
the European Union, the WTO, The International Criminal Court etc. replaced or extended the national
functions to facilitate international agreement.

Another major impact of globalization is the increased influence of Non- Governmental Organizations
(NGOs) in humanitarian aid, developmental efforts etc.

Globalisation boosts international travel and tourism indirectly due to the international business.
Immigration between countries, formation of free trade zones, growth of cross cultural contacts,
enhancement in worldwide culture etc. is increasing due to the globalisation.

Impact of Globalization in India Globalization has helped in:

• Raising living standards,

• Alleviating poverty,
• Assuring food security,
• Generating buoyant market for expansion of industry and services, and
• Making substantial contribution to the national economic growth.

MERITS AND DEMERITS OF GLOBALIZATION

The Merits of Globalization are as follows:

1. There is an International market for companies and for consumers there is a wider range of products to

choose from.

2. Increase in flow of investments from developed countries to developing countries, which can be used for

economic reconstruction. Foreign direct investment (“FDI”) tends to increase at a much greater rate that

the growth in world trade, helping boost technology transfer, industrial restructuring, and the growth of

global companies.

3. Greater and faster flow of information (through TV, Internet) between countries and greater cultural

interaction has helped to overcome cultural barriers.

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4. Technological development has resulted in reverse brain drain in developing countries.

5. Economies of Scale- Globalization enables large companies to realize economies of scale that reduce

costs and prices, which in turn supports further economic growth, although this can hurt many small

businesses attempting to compete domestically.

THE DEMERITS OF GLOBALIZATION ARE AS FOLLOWS:

1. The outsourcing of jobs to developing countries has resulted in loss of jobs in developed countries as a

result, now they are following protectionism measures, for example USA is restricting BPO.

2. There is a greater threat of spread of communicable diseases.

3. There is an underlying threat of multinational corporations with immense power ruling the globe. For

smaller developing nations at the receiving end, it could indirectly lead to a subtle form of colonization.

4. Exploitation of labour by offering low wages

5. Increase in global terrorism

6. Environmental concerns such as worldwide increase in pollution