WHAT IS GLOBALISATION?
In recent years there has been an intense debate about the meaning of globalisation. This article aims to explain the nature of the discussion and its impact oninternational financial markets. The first question which has to be dealt with is whether globalisation is an irreversible phenomenon like the law of gravity. Undoubtedly it is: there is no way back, sowhat we should discuss is whether it is good or bad, not whether it can be reversed or not. It is irreversible for a number of reasons. The most important is that once there is free movement of capital,there is no turning back. Short-term controls can be introduced if there is a crisis, but economists are not sure if they are of any use, since they are easy to set up but difficult to remove. What ismore, if a country introduces controls, investors in a free market will not put their money back into the country for a long time, with the result that the economy will stagnate. But what isglobalisation? Is it an economic, political or social phenomenon? There is no doubt that globalisation is a wide-ranging concept which includes economics, politics and society. Our definition of globalisationwill follow the analysis made by Martín Redrado, who thinks that although we cannot be sure of its meaning or its wide-ranging effect, we have all heard of it, and we have all resorted to it ineveryday conversation to explain the thousands of small events which define the world we live in. “It’s.... globalisation,” we say with a shrug of the shoulders when we have to rationalise somefar-reaching change in the political, social or economic sphere. And we are right to do so, when we are dealing with similarities and differences, the word globalisation has to do with change and crisis.Globalisation; change; crisis: we hear these words everywhere. They are used in political speeches and journalists’ questions; in weighty economic reports and the reaction of ordinary people overwhelmed by...
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