What is the hyperglobalization thesis? what does it predict with regard to the nation-state ability to maintain its tax structure, its labor regulation, and its environmental regulations? Is this a real threat and do nations take the threat seriously ?
Still, not all of the effects of globalization are viewed as positive. In the decades which have passed since the end of the Cold War, some of the inherent dangers in instigating massive institutional transformation have come to the surface. There are implicit threats in the transition of the developing world from dictatorial to democratic governance, in the change to regional forms of currency, in the adoption of free market principles and in the engagement of private enterprises from the developed world.
All of these may instigate what is known as hyperglobalization. This is the negative fallout from the rapid transition of developing nations toward participation in a world economy that includes considerably larger-scaled economic trade partners. As Ravenhill reports, "a combination of the exit threats and concerns arising from the hyperglobalization thesis about the likelihood of exit may well have had an independent effect on the trajectory of fiscal and labour market reform." (Ravenhill, 321)
In a sense, developing nations which are seized upon initially as partners in the global trade often suffering something of a market-correction. Over-speculation by private enterprises often leads to the exit that Ravenhill discusses above, in which private enterprises move on from a market such Mexico -- first opened up by NAFTA -- to one such as Indonesia -- which CAFTA would open up to companies interested in even cheaper labor. The flight from Mexico would lead to a massive suckout of economic fortunes, with the painful economic retraction demonstrating the real threat of wanton proliferation of trade.
These are considered anathema, and hyperglobalization is often blamed on the over-involvement of taxation in economic affairs. As Ravenhill tells, global capitalists of the purest intent would argue that "the welfare state is, for business, merely a drain on profits. Such assumptions reflect a narrowly Anglo-U.S. Conception of competitiveness -- and as we shall see presently, are difficult to reconcile with the empirical evidence. Though ever more influential, the hyperglobalization thesis extrapolates wildly and inappropriately from labour-intensive sectors of the international economy in which competitiveness is conventionally enhanced in this way to the global economy more generally." (Ravenhill, 321)
This latter point is a dismissal of fears of hyperglobalization by way of an endorsement of that which has always been an effect of capitalism. That is, Ravenhill states that with globalization as in the democratized nation state, to the competitive victor go the spoils. The callous view that ultimately extends capitalism as a false value system, this denotes that where whole nations such as Mexico are the victims of capitalist investment and sudden withdrawal, there is a parallel in local business. To be certain, the manner in which a company such as Wal-Mart swallows whole towns in order to feeds its profits is deeply analogous to the effects of hyperglobalization.
In the economic turmoil, political instability and environmental degradation that have come to define such nations as Mexico, we can see that hyperglobalization is indeed real and is indeed a threat to the stated goals of the world economy.
Works Cited:
Ravenhill, J. (2005). Global Political Economy. Oxford University Press.
