A. Orlov - Institution-formation theory and principles of its construction. Globalization and the main mechanisms of the development of society

The crucial change in world history came at the turn of the fifteenth and sixteenth centuries, the age of the Great Discovery. Since then, an increasing number of western European countries (first Spain and Portugal, then England, France, and Germany) have been guided by economic considerations. As Europeans established a monopoly on direct maritime communications with other continents, a system of world trade relations began to develop, gradually embracing the whole known world of the time. The dominant positions in this global trading system were taken by those who created it, namely the Europeans. They were the ones able to extract, from trade operations with Asian, African, and American countries, not just profits but super-profits due to the non-equivalent, i.e. unequal nature of this trade exchange. Thus, a phenomenon that had never existed before in human history – the global economic system (also known as “the global capitalist system” or simply “the modern world system”) – emerged.

From the point of view of the systemic approach, the end of the modern era represents nothing less than the first signs of the emergence and development of the world (global) economic system. The most important feature of the global economic system is that, firstly, it functions precisely as a market, i.e. as a system of trade exchange, and secondly – and this is particularly important – it does not relate to any external social systems. At the same time, local economic and social systems, while continuing to retain their subjectivity, are becoming increasingly open to external factors, rather than being self-sufficient. In other words, the global economic system is a system of economic entities whose development is less and less limited by geographical, political, and legislative frameworks, and unrestrained by political regulations of the state.

Globalization differs from the earlier periods in the formation and presence of a single economic space. As a result, one of the objective trends in the development of society is the general commercialization and digitalization of the entire world, including the commercialization, mechanization (industrialization), and unification of all areas of social life that were not involved in market relations in the past.

The modern stage of economic globalization is characterized by the widespread commercialization and privatization of state monopolies (housing and utilities, energy, transport, the military-industrial complex, etc.), which are carried out according to the same template across the entire world. Commercialization and privatization have also affected other initially non-commercial areas and institutions of social life (education, science, medicine, culture). At the same time, even today, at the peak of corporate globalization and “privatization of the welfare state”, the objective tendency of expansion of capital and relations that are based on commodity and currency is not absolute and is always restrained by certain limits of a non-economic order.

These limits can be physical (space and resource limitations), political (state organizations and structures, borders, etc.), technological (transport, communications, etc.), the requirements of social stability (social stratification is simply the reverse side of the concentration of capital), security, and the long-term needs of modernization and infrastructure construction, which require long-term investment.

Therefore, economic globalization with its ultra-liberal economic model should not be seen as an irreversible process, as neoliberal thinkers typically do, but as a reversible and even cyclical shift in the balance of power and interests among various elites and other social groups.

The objectivity of economic laws does not mean that restrictions of a non-economic order must be abolished since it is the non-economic limitations of law that allow human societies to exist. The presence of a permanent tendency does not mean the abolition of forces opposed to it, either objective or subjective. For example, the objectivity of the law of universal gravitation affects evolution, but by no means does it impose a ban on terrestrial life forms that exist in the constant struggle with the force of gravity.

Liberalization and commercialization cause the degradation of vital – especially in the long term – non-commercial spheres of social life (science, culture, education, marriage, and family relations), which constitute an essential part of human existence.

Probably, the crises in the world economy and the domestic politics of individual states caused by liberalization, commercialization, and deregulation will in the future lead to the opposite movement, namely to a natural deliberalization and regionalization, and the reincarnation of such social institutions as nation states and nations.

At any rate, we have the example of Roosevelt’s New Deal, which replaced the decade of post-war liberalism of the 1920s. Moreover, there are many other examples of successful deliberalization and deprivatization, most notably the creation of the European model of the “welfare state” 7 7 Erhard, L. 50 years of thoughts / Polveka razmyshlenii. Translated from German by A. Andronov, V. Kotelkin, T. Rodionova, N. Selezneva. M.: Nauka, 1996, 606 pp. and the construction of a range of viable models of socialism and compromise social models based on several civilizations and cultures.

In the economy, there have been global changes linked with the emergence and growth of transnational corporations (TNCs) and globalized banking and financial structures.

Manufacturing has long ceased to be only national; it is increasingly transnational as individual countries are responsible only for certain stages of producing a product, which travels a long way from raw material to being ready for use through the production cycles of many countries. This is the type of production carried out by TNCs, but they do not focus on a single industry or product.

Thus, in the 1990s, the combined sales of the world’s 500 largest TNCs accounted for more than a quarter of global GDP, more than a third of global manufacturing exports, three-quarters of trade in goods, and four-fifths of trade in technology. At the same time, about 40 per cent of world trade happened in the trade flows within TNCs 8 8 Lisichkin, V.A., Shelepin, L.A. Globalnaya imperia Zla. M.: Krymsky most-9D, Forum, 2001, 448 pp. .

However, these same figures show that, when taking into account national markets, including some sectors of the economy that are purely local yet quite large (housing and utilities and infrastructure) and the presence of a fairly significant natural economy, no more than 30 per cent of the economy is globalized. At the same time, its knowledge-intensive and technological part, which is not connected with the necessities, and the financial sector with its specifics are globalized.

The limited natural resources of the world have led to the formation of a vertical structure of the world system, divided into a “core” and a “periphery” both spatially and socially. This leads to the strengthening of the power of elites and desocialization of the “middle class”. Similarly, the unevenness of development increases in all spheres of life, both globally and locally. The growth of disparity, including social differentiation, is both the cause and the result of increased competition for all kinds of resources.

The global economic system consists of fundamentally unequal interacting components, which are the “core” and the “periphery”. The “core” of the global economic system consists of countries that benefit from economic interaction with other states (these are the so-called “developed countries”). The “periphery”, on the other hand, consists of states that lose out in economic cooperation with countries that are part of the “core” economic system. These components finally took shape in the twentieth century.