📚 COMPREHENSIVE REVIEWER – THE

CONTEMPORARY WORLD
🌍 ECONOMIC GLOBALIZATION
 Definition: First introduced by Levy (1985). Refers to the
transnational increase in trade and capital movement across
borders.
 Key Feature: National governments now play a smaller role;
transnational corporations operate in many countries but pledge
loyalty to none.

🔑 Forms of Economy

1. Protectionism – Protecting a nation’s economy by:

o Creating trade barriers
o High customs duties
o Limiting imports or banning products
2. Trade Liberalization (Free Trade) – Removing/reducing trade
barriers to make trade easier and accessible.

🏛 Institutions of Economic Globalization

 Bretton Woods Conference/Agreement – WWII meeting of 44

nations to discuss post-war economy, leading to:
o International Monetary Fund (IMF)
o World Bank
o World Trade Organization (WTO)
o New International Economic Order (NIEO)
o New World Information and Communication Order
(NWICO)
 Organization for Economic Cooperation and Development
(OECD) – 30 members producing ⅔ of global goods/services.
Acts as a think tank forecasting trends, advising on trade policies.

🌎 Global Actors

 Transnational Corporations (TNCs) – Key drivers of

globalization; operate in multiple countries, profit from cheap
labor/resources, shape global production.
 Multinational Corporations (MNCs) – Operate globally,
negotiate favorable terms, drive innovation and productivity.
 IMF – Promotes financial cooperation, offers short-term loans,
stabilizes economies.
  World Bank – Focuses on ending poverty, provides
financial/technical aid.
 WTO – Official platform for trade negotiations, sets trade rules.

🌐 THE MODERN WORLD SYSTEM

🔑 Key Concepts

 Modern World System – Global network of economic and

political interconnections, shaped by capitalism.
 Immanuel Wallerstein – Developer of World-System Theory.

⚙ Wallerstein’s World-System Theory

 Capitalist World Economy – Global system focusing on goods

production for profit.
 Capital – Wealth/resources invested for profit (seen as a social
relationship).

🌍 Political & Economic Specialization

1. Core Nations – Strongest nations, technologically advanced,

export capital-intensive goods.
2. Semi-Periphery Nations – Industrialized third-world nations,
less powerful than core.
3. Periphery Nations – Economies less mechanized, export raw
materials/agriculture.

🏭 Industrialization & Stratification

 Industrial Revolution (Post-1750 Europe) – Urbanization,

mechanization, class stratification.
 Bourgeoisie (owners) & Proletariat (laborers) – Class conflict
emphasized by Marx.
 Weber’s Contribution – Added dimensions of power/prestige,
highlighted middle-class complexity.
 Mass Production – Led to overconsumption, conspicuous
consumption.
💱 MARKET INTEGRATION
📖 Definition

Market Integration – When prices of related goods in different locations follow similar
patterns over time.

🏦 Role of International Financial Institutions (IFIs)

 Chartered by multiple countries, subject to international law.

 Best-known IFIs (post-WWII):
o IMF – Temporary financial assistance, balance of payment
support.
o Multilateral Development Banks (MDBs):
 World Bank Group
 African Development Bank
 Asian Development Bank
 Inter-American Development Bank
 European Bank for Reconstruction and Development

🎯 Objectives

 IMF – Provides short-term financial help.

 MDBs – Long-term loans, very long-term loans, grants for
development projects.

📊 Types of Market Integration

1. Horizontal Integration – Firm controls other firms doing similar

functions at the same marketing level.
2. Vertical Integration – Firm performs more than one marketing
function (production + distribution).
3. Conglomeration – Combination of unrelated businesses under
one management.

🏢 GLOBAL CORPORATIONS
🌍 Characteristics

 Conduct major operations (manufacturing, R&D, distribution,

marketing) outside home country.
 Influence local/global trade laws, economy, culture.
 Have strong global brand recognition.
🏷 Classifications

1. International Companies – No foreign investments; only

import/export.
2. Multinational Companies – Have foreign investments; localize
products/services.
3. Global Companies – Invest in many countries but keep one
strong HQ; market to each global market.
4. Transnational Companies – Complex structures, investments
in many countries, decision-making distributed across HQs
worldwide.

🏆 KEY TAKEAWAYS
 Globalization is driven by trade, corporations, and institutions like
IMF, World Bank, WTO.
 Modern World System divides nations into core, semi-
periphery, periphery.
 Market Integration allows goods and prices to move in similar
patterns globally.
 Global corporations shape culture, economy, and innovation
worldwide.
📚 COMPREHENSIVE REVIEWER – THE
CONTEMPORARY WORLD
🌍 GLOBALIZATION
📖 Definition

Globalization is the process of increasing interconnectedness of countries, economies,

societies, and cultures across the world. It is driven by trade, technology, information
flow, and international cooperation.

🔑 Key Features of Globalization

 Economic Globalization – Integration of national economies

through trade, investment, and capital flows.
 Political Globalization – Growth of international organizations
and cooperation between governments (e.g., United Nations,
WTO).
 Cultural Globalization – Spread of ideas, values, languages,
media, and cultural products worldwide.
 Technological Globalization – Rapid spread of technology and
innovation across borders (internet, communication,
digitalization).
 Social Globalization – Movement of people, migration, tourism,
exchange of knowledge and culture.

🌎 Causes of Globalization

1. Advances in Technology – Internet, transport, communications.

2. Trade Liberalization – Removal of barriers to free trade.
3. International Agreements – Bretton Woods institutions, WTO
agreements.
4. Rise of Global Corporations – TNCs and MNCs creating
international supply chains

🌍 ECONOMIC GLOBALIZATION
(already included – retained for completeness)

 Definition: Introduced by Levy (1985). Transnational increase in

trade & capital movement.
 Forms:
o Protectionism – Barriers to protect domestic economy.
o Trade Liberalization – Removing trade barriers.
 Institutions: IMF, World Bank, WTO, NIEO, NWICO, OECD.
  Global Actors: TNCs, MNCs, IMF, WTO, World Bank.

🌐 MODERN WORLD SYSTEM

 Immanuel Wallerstein’s Theory: Core, Semi-Periphery,
Periphery Nations.
 Industrialization & Stratification: Urbanization, class conflict,
bourgeoisie vs. proletariat.
 Capitalist World Economy: Production for profit, global
integration.

💱 MARKET INTEGRATION
 Definition: Prices of goods across markets follow similar
patterns.
 IFIs: IMF + Multilateral Development Banks (ADB, World Bank,
AfDB, IDB, EBRD).
 Types: Horizontal Integration, Vertical Integration,
Conglomeration.

🏢 GLOBAL CORPORATIONS
 Characteristics: Global operations, brand influence, R&D
worldwide.
 Classifications: International, Multinational, Global,
Transnational.
📝 SITUATIONAL REVIEWER (40 QUESTIONS)

🌍 GLOBALIZATION (Q1–Q10)

1. Ana is studying in the Philippines but attends online classes offered by a U.S. university while
collaborating with classmates from Japan and Brazil.
What concept best explains this interconnectedness?
Answer: Globalization

2. A famous Korean drama becomes a hit in Latin America, leading to more fans learning the Korean
language.
What type of globalization is shown?
Answer: Cultural Globalization

3. The government signs a new international climate agreement to reduce carbon emissions by 2030.
What type of globalization is this?
Answer: Political Globalization

4. When smartphones manufactured in China are sold worldwide, and everyone gets the same software
updates, this shows:
Answer: Technological Globalization

5. Filipino workers migrate to the Middle East for better job opportunities, sending remittances back home.
What aspect of globalization is involved?
Answer: Social Globalization

6. A developing country adopts free trade policies, removes tariffs, and encourages foreign investors to set
up factories.
What is this process called?
Answer: Trade Liberalization

7. A student argues that globalization has allowed poor countries to receive new technologies and
opportunities, but also worsened inequality.
What are these two contrasting effects called?
Answer: Positive and Negative Effects of Globalization

8. A local fast-food chain in the Philippines adopts an American business model and serves burgers and
fries like McDonald's.
This is an example of:
Answer: Cultural Homogenization

9. International flights resume after a pandemic, boosting tourism and international trade again.
This reflects which cause of globalization?
Answer: Advances in Transportation

10. During a global crisis, governments rely on WHO and UN guidelines for a unified response.
This shows which feature of globalization?
Answer: Global Cooperation
💱 ECONOMIC GLOBALIZATION (Q11–Q17)

11. The Philippines imports rice from Vietnam and exports bananas to Japan.
This is an example of:
Answer: International Trade (Economic Globalization)

12. A country raises tariffs to protect its local farmers from cheap imported goods.
What economic policy is applied?
Answer: Protectionism

13. The Bretton Woods Conference led to the creation of IMF and World Bank.
What was the main purpose of this event?
Answer: Establish rules for global economic cooperation

14. A struggling country receives a short-term loan from IMF to stabilize its currency.
This shows the role of which institution?
Answer: International Monetary Fund (IMF)

15. A poor country receives long-term loans and technical assistance to build schools and hospitals.
Which global institution provides this?
Answer: World Bank

16. Several nations reduce tariffs to encourage freer flow of goods and services.
This action is an example of:
Answer: Trade Liberalization

17. Critics argue that transnational corporations exploit cheap labor in developing countries.
Which key actor of economic globalization is criticized here?
Answer: Transnational Corporations (TNCs)

🌐 MODERN WORLD SYSTEM (Q18–Q24)

18. The U.S. exports technology and luxury goods, while importing raw materials from poorer nations.
This reflects its position as a:
Answer: Core Nation

19. Brazil is industrialized but still less powerful than core nations like the U.S. and Japan.
It belongs to which category?
Answer: Semi-Periphery Nation

20. A small African country relies on exporting coffee beans and has limited factories.
This is an example of a:
Answer: Periphery Nation

21. The Industrial Revolution led to the rise of factory owners and workers, causing class conflict.
What two classes emerged?
Answer: Bourgeoisie and Proletariat

22. A researcher studies how capitalism creates global inequality between rich and poor countries.
What theory does this study follow?
Answer: Immanuel Wallerstein’s World-System Theory

23. When people in developing nations buy luxury products to show social status, this reflects:
Answer: Conspicuous Consumption
24. Industrial expansion causes deforestation, pollution, and displacement of indigenous people.
This is called:
Answer: Industrial Degradation

📊 MARKET INTEGRATION (Q25–Q32)

25. If the price of oil in Saudi Arabia rises, and immediately gasoline prices in the Philippines also rise, this
shows:
Answer: Market Integration

26. A company acquires another company at the same production level to reduce competition.
This is an example of:
Answer: Horizontal Integration

27. A firm owns farms, processing factories, and its own delivery trucks.
This situation is called:
Answer: Vertical Integration

28. A business group owns a supermarket, a construction firm, and a clothing line under one management.
This type of market integration is:
Answer: Conglomeration

29. A development bank gives loans to build roads and bridges to promote trade.
Which institution does this represent?
Answer: Multilateral Development Bank (MDB)

30. The IMF provides temporary loans to help a country fix its balance of payments.
This fulfills which main objective?
Answer: Financial Stability Support

31. Countries like the Philippines and Japan become members of IFIs, agreeing to contribute funds and
receive benefits.
This is an example of:
Answer: Membership Composition of IFIs

32. Economists argue that market liberalization can sometimes hurt local farmers due to cheap imports.
What does this situation highlight?
Answer: Market Imperfections / Welfare Loss

🏢 GLOBAL CORPORATIONS (Q33–Q40)

33. A company has factories worldwide but keeps one main headquarters in the U.S.
It is classified as a:
Answer: Global Company

34. A brand produces goods in different countries and adapts its products to local tastes.
This is a:
Answer: Multinational Company

35. A small business exports its handmade crafts abroad but has no foreign investments.
This type of company is:
Answer: International Company
36. A corporation distributes decision-making to various national headquarters and operates research
facilities worldwide.
This is a:
Answer: Transnational Company

37. A global clothing brand can influence fashion trends and even pressure governments about trade rules.
This shows:
Answer: Influence of Global Corporations

38. Employees in different countries follow the same policies and use the same logo, making the company
easily recognized worldwide.
This shows which characteristic of global corporations?
Answer: Strong Global Brand Recognition

39. Digital platforms like Amazon and Alibaba make it easy for people in remote areas to shop online.
This is an example of:
Answer: Global Corporations influencing consumer behavior

40. A government changes its trade policy to attract investments from a big technology company.
This reflects:
Answer: Corporate Power over Local Economies