Reimagining Globalization for the Future

Sep 6, 2024

Lecture Notes: Future Globalization

Introduction

  • Presenter: Tanya Cushman
  • Aim: Change the perception of globalization and raise awareness about its future.
  • Current imagery of globalization often limited to goods (e.g., cargo ships).

Current State of Globalization

  • Traditional view: Focus on physical goods, things we make.
    • Driven by arbitrage: companies exploit differences in production capabilities across countries.
    • Easier to ship goods than services across borders.

Barriers to Service Globalization

  • Services require both provider and buyer to be in the same place (e.g., personal service jobs).
  • Current globalization primarily involves goods because:
    • Shipping services across borders is technically challenging.

The Role of Digital Technology

  • Digital technology is changing the landscape of globalization.
  • Introduction of Telemigration:
    • Remote workers in one country providing services in another.

Economic Incentives for Telemigration

  • Significant salary differences across countries create economic incentives:
    • Example: U.S. vs. Polish accountants.
  • Workers can potentially save companies money through remote service provision.

Factors Easing Telemigration

  1. Domestic Telecommuting:

    • Increased remote work arrangements leading to global hiring of freelancers.
  2. Online Freelancing Platforms:

    • Platforms like Upwork facilitate the hiring of foreign freelancers.
    • Millions of freelancers registered from over 100 countries.
  3. Machine Translation Advances:

    • Significant improvements in translation technologies.
    • Tools like Skype Translator and Microsoft Translator open new opportunities for communication between languages.
  4. Advanced Telecommunications:

    • Telepresence technology allows remote workers to interact as if they were in the same location.
    • Telepresence robots enhance the feeling of physical presence in meetings.

The Speed of Change

  • Digital technology is advancing rapidly:
    • Example: iPhone's processing power compared to the Apollo 11 computer.
    • Each iteration of technology is exponentially more powerful leading to faster changes in globalization.

Conclusion

  • Future globalization will focus more on services (things we do) rather than just goods (things we make).
  • Increased opportunities for competitive citizens but also heightened competition for less competitive ones.
  • Overall, a mix of anxiety and excitement about future globalization is warranted.

Key Takeaways:

  • Reconsider the traditional views of globalization focused on goods.
  • Prepare for the rapid advances in service globalization driven by digital technology.
  • Embrace the opportunities while remaining conscious of the competitive landscape.