Understanding Globalisation through the Lens of Contesting Narratives

From the colonial period to the present phase of capitalism, globalisation in its various phases has been commonly associated with structural changes that include rapid technological progress and changes in the consumption and production pattern across countries. Notwithstanding the common features in its different phases, the historic specificity of the present phase of globalisation can be located in the manner in which the global market is integrated within existing institutional framework. There are at least four distinct features that have characterised the present phase of globalisation.

First, over and above the flow of goods and services, it involved cross-border flow in investments with multinational corporations (MNCs) relocating their production base from developed to developing coun­tries with the objective of using global cost arbitrages. These changes affected the output growth rate and the pace of technological progress in a manner that enabled a number of developing countries to close the gap with the developed countries. Second, globalisation has been associated with greater short-term capital flows and “financialisation” of different economies, leading to greater financial fragility and income share of the rentier class. Third, transcending the divide between developed and developing economies, the present phase of globalisation has registered a sharp reduction in the income share of labour along with the latter’s reduced bargaining power. Fourth, with the diffusion of production and consumption patterns that typically involve high carbon emissions, the cha­llenge of environmental sustainability has confronted the global economy like never before.