Volume 44, Number 173,
April-June 2013
The Importance of Suitable Ideas
on Development and Globalization
Aldo Ferrer
GLOBALIZATION AND DEVELOPMENT

The contemporary debate surrounds the conditions of economic development in a situation of close relations among countries, with greater intensity on the foundations of Latin American critical thought. What then are the links between the development of a country and the world order, which we currently call “global”? We shall briefly remember a few basic concepts.

Globalization

This is a system of networks in which commerce, investments from multinational corporations, financial currents, the movement of persons and the circulation of information linking different civilizations are organized. It is likewise the space in which power is exercised and dominant powers establish the rules of the game that articulate the global system in each historical period. One of the major mechanisms of domination is to build theories and visions that are presented as universally approved, but that in reality, are a function of the interests of central countries.

Globalization networks encompass activities that transcend national borders. Their relative weight in the overall world economy has grown since the end of the Second World War. However, the activities developed in each national space constitute the immense majority of economic and social activity. Exports represent nearly 20% of the world product, while 80% of the product is destined for internal markets. Subsidiaries of multinational companies generate nearly 10% of the product and the accumulation of fixed capital in the world, which indicates that 90% of the product is a result of local companies and some from investments financed with internal savings. Persons residing outside of their country of origin represent 3% of the global population; in other words, 97% of human beings live in the country in which they were born.

In the real plane of resources, production, investment and employment, the internal space has a decisive weight. However, in the virtual sphere of financial currents and information, the global dimension is dominant and contributes to the generation of an image that today’s world is a global neighborhood without borders. According to this vision, events are determined by the impact of new technologies, and as such, by ungovernable forces that cannot be corrected by public action or civil society organizations. One of the expressions of this stance is the theory of rational expectations , which says that economic actors anticipate and prevent State decisions seeking to interfere with the natural functioning of markets.

This fundamentalist view of globalization is a function of the interests of the countries and economic actors that hold dominant positions in the world order. In reality, the apparent inability to govern the forces operating at the heart of globalization does not obey supposedly indomitable phenomena, but rather market deregulation, which is a transitory expression of the behavior of the global system.

Development

Globalization has not changed the nature of the process of economic development, which continues to rely on the capacity of each country to participate in the creation and spread of knowledge and technology and incorporate this into their overall economic activity and social relations. Economic development is still a process of economic transformation and a society based on the accumulation of capital, knowledge, technology, capacity to manage and organize resources, education and abilities of the labor force, stability and permeability of institutions, during which the society undergoes conflicts and mobilizes its resource potential. Development is accumulation in the broader sense and this accumulation occurs primarily within each country’s own space.

Development implies the organization and integration of creativity and the resources of each country to implement accumulation processes on a broader level. The process is non-transferrable to exogenous factors, which, free from their own dynamic, can only dismantle a national space and restructure it around extra-national decision-making centers, thus hindering accumulation processes and development. A country can grow, increase production, employment and productivity of factors driven by exogenous agents, as occurred in Argentina in the primary export economic stage. But it may grow without developing, that is, without creating economic and societal organization capable of mobilizing the accumulation processes inherent to development. In other words, it may grow without incorporating scientific thought and its technological applications into overall economic and social activities.

Published in Mexico, 2012-2017 © D.R. Universidad Nacional Autónoma de México (UNAM).
PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 48, Number 191, October-December 2017 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
CP 04510, México, D.F. Tel (52 55) 56 23 01 05 and (52 55) 56 24 23 39, fax (52 55) 56 23 00 97, www.probdes.iiec.unam.mx, revprode@unam.mx. Journal Editor: Alicia Girón González. Reservation of rights to exclusive use of the title: 04-2012-070613560300-203, ISSN: pending. Person responsible for the latest update of this issue: Minerva García, Circuito Maestro Mario de la Cueva s/n, Ciudad Universitaria, Coyoacán, CP 04510, México D.F., latest update: Nov 13th, 2017.
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