Economic Globalization and National Governance

There have been debates on whether globalization has been reinforcing or undermining the legitimacy/roles of national states over years. Globalization is a term that has been used as early as in the 1908’s as the reason for widespread of common currencies by economists, academics, politicians, business, the media, financial institutions and traders (Held, 2009, p. 213). In short, the globalization is used to refer to the concept of global village where states and nations are brought together where political, economic and cultural issues have been extended across the continents.
A lot of globalization debates and governance have concentrated on the former depriving the later its sovereignty power. Likewise, commentators and analysts have traced the diminishing nation state to the global growth and development. While other especially political analysts have gone further to link globalizations and nation-state crisis, state obsolescence or the extinction of state powers (Anthony McGrew, 2002, p. 25). Globalization has been under fierce criticisms from that view it as a major threat to social cohesion which undermines national and welfare state. They argue that globalization as succeeded to drain political authority as far as national states is concerned. At the moment, globalization has forced the governments to formulate their policies and institutions to support globalization least there are left less competitive in the global market. This has resulted to conflicting direction between roles of globalization in nation-state decision making (Youngs, 1996, p. 147).
The analysts in support of globalization say that it is a boast to economic integration across state and national borders. According to Stephen Kraser, an economist; Globalization has contributed to strengthening g the national /state sovereignty instead of weakening it. What can be explicitly agreed upon is that globalization has contributed to the reshaping and remodeling of the national states policies and powers. The study will examine whether globalization has reduced the roles of national states and the future of national states with respect to the growth and expansion of national states.
In order to establish the claim, the study will focus on the following subtitles: First we shall define the terms globalization and its effect on national-state legitimacy/governance. Secondly, the paper will examine the role of globalization in: (a) end state sovereign; (b) rising supraterritorial constituencies; (c) rise of limitation of provision of social security by states; (d) emergence of multilateralism; (e) impractical in achieving democratic governance by the state (Witzel, 2010, p. 57). The six parameters shall be used to establish whether globalization has undermined role of national states over the years. Finally after the in depth analysis, a conclusion shall be arrived at.
Definition of Globalization
The term globalization can be defined in three different ways: first in respect to the increasing cross-border relationship. Secondly, globalization is defined as the increase to the open-boarder relationship. Lastly, the term is defined as the increasing trans-boarder relationship. The three connotations can be seen to mean internationalization of the products and services. Under globalization social relations has become les controlled by the territorial frame work (Ohmae, 1995, p. 73). Globalization has made the world to look like a global village where business enterprises have expanded their services, global regulatory agencies and civil societies act in trans-border operations, spread of certain currencies for example US dollar and financial items like Eurobonds among others. Under globalization we have witnessed the emergence of terms like global markets, global production, global commodities, global business and multinational organization and global finance and money.
Globalization and nation-state governance
What the study seeks to answer is the implication of capital globalization as described above has to do with the roles of national states. First we have to agree that not all the nations are equally affected by globalization .Secondly, we accept that so afar the study have established that globalization have a role in undermining role of nation-states (Steve Chan, 2003, p. 254). Different nations have different resources, different cultures, different choices and options, different policies resulting to different levels of globalization effects. The following are the ways which globalization has succeeded to undermine or reduce the roles of nation -state governance:
Persistence of States
Many scholarly articles and analysts have presented states as obsolete and powerless in this era of globalization. The trans-border production, marketing, finance and money have negatively affected bargaining powers of some nations. The developing countries, which are generally weaker and smaller, lack the power to determine their products prices in the global market (Rodrik, 2012, p. 316). Some of the times it has been observed that the currencies of such countries have poor exchange rates in the market against currencies such as Euro and US Dollar.
Although, the states have been entitled in creation of regulatory laws and policies that govern globalization they cannot fully exercise such powers. The governments are supposed to create laws for example investment codes, currency regulations, labor laws, tax regimes, police protection and trade laws. Under such scenario, the governments are restricted by the globalization in creating laws that would promote trade within their territories (Thompson, 1996, p. 203). When the government tries to create laws country to globalization, its products would definitely lose its competitive advantage in the market.
End of Sovereignty /legitimate power
Sovereignty ac cords each and every state comprehensive, supreme and exclusive power which applies in its territorial jurisdiction. Prior to globalization states had the full control of their boarder, social life and economic practices. Governments did not share their policies with other nations. In the rise of globalization, national no longer enjoy such powers and controls (Rodrik, 2012, p. 44). In the current century, nations have become impractical. Global processes such as transboarder manufacturing and electronic money transfer cannot be controlled within one territory: Nations are restricted to exercise full jurisdiction. Under globalization several nations have to agree to several terms and treaties of trade before global production and engagements are commenced. This is evident in the money exchange market, where the exchange rates are determined by the forces of demand and supply but not the countries that own that currency (Held, 2009, p. 157).
Supraterritorial constituencies
With the end of sovereignty power of nations-states, the government enjoys limited power to protect their citizens against exploitation of the outsiders. During the pre globalization period, the government ensured that the interests of their people were fully protected from foreigners (Youngs, 1996, p. 11). With the rise of globalization, many governments depend on the global capital market to run their national development. Under such a situation, they have to formulate laws that support foreigners and their policies least they lose capital support form them. Such governments are forced to reduce the tax rates on such companies and law a certain percentage of foreign citizens to work in their nations.
Unprecedented multilateralism growth
Globalization has seen the development of multilateral arrangements among different nations. This has forced many nations to abandon the unilateral approaches that have been used before the globalization. In respect to joint intervention s and consultations among different nations, many states have lost their decision powers as far as globalization is concerned. Collective economic decision making and managements among nations have emerged in the current century (Thompson, 1996, p. 78). At the moment nations have to consult with international financial institutions like World Bank and IMF on their national projects and the management of the funds provided to them by the institutions.
Globalization block democracy
Globalization has been used by stronger nations to oppress the weaker ones. Prior to globalization, when a firm invested in a given territory, the government had to provide operational guidelines that ensured transparency and democratic engagement between the two parties. But with the dissolution of sovereignty under globalization, democratic and transparent engagement is no longer observed (Anthony McGrew, 2002, p. 56). For example, the G7 countries usually make decisions without consulting non member states that their decisions are expected to affect.G7 members does not care how their policies would affect other governments as far as their maintain their supremacy in the global market and trade.
Conclusion
The paper has examined five elements that show a negative effect globalization has on roles of national states and governments. As brought out in the study, globalization has resulted into restricting of previous institutions and policies of different nations. Some has left the governments with no choice but to adhere to the terms represented by the global market. Globalization has strengthen the positions of some countries(G7) while at the same time weakening others (developing countries).With weak sovereignty powers, lack of democracy in decision making and engagement with international investors, it is clear that globalization has contributed to the reduction of national state roles.

References list
Anthony McGrew, D. H. (2002). Governing Globalization: Power, Authority and Global Governance. New Jersey: Wiley.
Guillén, M. F. (2001). The Limits of Convergence: Globalization and Organizational Change in Argentina, South Korea, and Spain. Princeton: Princeton University Press.
Held, D. A. (2009). Global Transformations: Politics, Economics and Culture. Stanford: Stanford University Press.
Ohmae, K. (1995). The end of the nation state: the rise of regional economies. London: Harper Collins.
Porter, M. E. (1986). Competition in global industries . MA: Harvard Business School Press: Boston.
Rodrik, D. (2012). he Globalization Paradox: Democracy and the Future of the World Economy. Washongton D.C: W. W. Norton & Company; Reprint edition .
Steve Chan, J. R. (2003). Coping with Globalization: Cross-National Patterns in Domestic Governance and Policy Performance. New York: Routledge; 1 edition.
Thompson, P. H. (1996). Globalisation in question: the international economy and the possibilities of governance. Cambridge: Polity.
Witzel, M. (2010). Coping with globalization: cross-national patterns in domestic governance and policy performance. New Jersey: Wiley & Sons Publiocations.
Youngs, E. K. (1996). Globalization: theory and practice. (London: Pinter.