faced new and daunting economic challenges. e IMF
estimated that global output would fall by 1.3 percent in
2009, the rst decline in sixty years. Although there were
some signs of recovery by May, most economists believed
that the worst global slump since the Great Depression of
the 1930s was far from over.
Global Culture and the Digital Age
Since the invention of the microprocessor in 1971, the
capabilities of computers have expanded by leaps and
bounds, resulting in today’s information age or digital age.
Beginning in the 1980s, computer companies like Apple
and Microso competed to create more powerful comput-
ers. By the 1990s, the booming technology industry had
made Microso founder Bill Gates the richest man in the
world. Much of this success was due to several innovations
involving computers that made them indispensable devices
for communication, information, and entertainment.
e Technological World
e advent of electronic mail, or e-mail, transformed
communication in the mid-1990s. As the capacity of com-
puters to transmit data increased, e-mail messages could
be accompanied by document and image attachments,
making them a workable and speedier alternative to con-
ventional postal mail and other delivery methods. At the
same time, the Internet, especially its World Wide Web,
was becoming an information exchange for people around
the world. A network of smaller, interlinking Web pages,
the Internet provides access to sites devoted to news, com-
merce, entertainment, and academic scholarship. As com-
puter processors have become more powerful, these web-
sites now possess video and music capabilities in addition
to text-based documents.
Advances in telecommunications led to cellular or mo-
bile phones. ough cellular phones existed in the 1970s
and 1980s, it was not until the digital components of these
devices were reduced in size in the 1990s that cell phones
became truly portable. Cell phones have since become
enormously important, and not only for communication.
Indeed, many nations have become nancially dependent
on their sales for economic growth. e ubiquity of cell
phones and their ability to transfer data electronically
have made text messaging a global communications craze.
Text and instant messaging have revolutionized written
language, as shorthand script has replaced complete sen-
tences for the purposes of relaying brief messages.
In 2001, Apple introduced the iPod, a portable digi-
tal music player. e pocket-sized device has since rev-
olutionized the music industry, as downloading music
dramatic economic crises such as the Great Depression
of the 1930s. e World Bank is actually a group of ve
international organizations, largely controlled by devel-
oped countries, which provides grants, loans, and advice
for economic development to developing countries. e
goal of the IMF is to oversee the global nancial system
by supervising exchange rates and o ering nancial and
technical assistance to developing nations. Today, 186
countries are members of the IMF. Critics have argued,
however, that both the World Bank and the IMF some-
times push non-Western nations to adopt inappropriate
Western economic practices that only aggravate the pov-
erty and debt of developing nations.
Another re ection of the new global economic or-
der is the multinational corporation or transnational
corporation (a company that has divisions in more than
two countries). Prominent examples of multinational
corporations include Siemens, Coca-Cola, ExxonMobil,
Mitsubishi, and Sony. ese companies are among the
two hundred largest multinational corporations, which
are responsible for more than half of the world’s indus-
trial production. In 2000, some 71 percent of these cor-
porations were headquartered in just three countries—the
United States, Japan, and Germany. In addition, these su-
percorporations dominate much of the world’s investment
capital, technology, and markets. A recent comparison of
corporate sales and national gross domestic product dis-
closed that only forty-nine of the world’s hundred larg-
est economic entities are nations; the remaining y-one
are corporations. For this reason, some observers believe
that economic globalization is more appropriately labeled
“corporate globalization.”
Another important component of economic global-
ization is free trade. In 1947, talks led to the creation of
the General Agreement on Tari s and Trade (GATT), a
global trade organization that was replaced in 1995 by
the World Trade Organization (WTO). Made up of more
than 150 member nations, the WTO arranges trade agree-
ments and settles trade disputes. e goal of the WTO is
to open up world markets and maximize global produc-
tion. But the WTO also has its critics. Some charge that it
has harmed small and developing countries, contributing
to the ever growing gap between rich and poor nations.
Others contend that it has ignored environmental and
health problems that have arisen as manufacturing jobs
have been transferred from developed countries like the
United States to developing countries with fewer protec-
tions for workers and the environment.
e extent of globalization became especially evident
in 2008 when a collapse of the largely unregulated nan-
cial markets in the United States quickly led to a world-
wide recession. Manufacturing plunged, unemployment
rose, and banks faltered as countries around the world
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