Entrepreneurship and Work in the Gig Economy

The Case of the Western Balkans

Mirjana Radović – Marković, Borislav Đukanović, Dušan Marković, Arsen Dragojević

• Publisher: Routledge
• Year: 2021
• Print ISBN: 9780367725778
• eBook ISBN: 9781000381061
• Topic: Business
• Subtopic: Business General
• Index: Business

The crisis caused by COVID-19 poses a major challenge for the global economy and business. It has been a test for economic resilience, and how this crisis will affect business activities will be determined by their competitiveness. Only firms that have succeeded in reorienting and quickly adapting to the emerging crisis have continued without interruption in their operations, thus demonstrating their flexibility and high level of resilience.

Research shows that companies driving the gig economy celebrate the benefits: flexibility, additional income, freedom and other various opportunities for workers. They require entrepreneurial digital skills that improve their competitiveness and benefit not only themselves but the economy as well. Therefore, digital competencies are becoming a significant resource and precondition for employment, and it is essential to promote digital entrepreneurial skills, introducing them into education programs through different forms of education. This book stresses and explores the importance of synergy between industry and virtual universities. Considering the importance of these issues, this book draws together literature on globalization and small and medium enterprise development and internationalization from disparate sources into a cohesive body of work, which traces the evolution of entrepreneurship and our understanding of the topic. It investigates the impact of digitalization on creating job opportunities in the labor market.

Covering social, economic and psychological approaches to the most current topics, this book will be a useful framework to new theories and practices that are emerging to challenge conventional wisdom. It will be of interest to scholars, upper-level students, and researchers involved in the field of entrepreneurship.

Part I
Theoretical Perspectives of Globalization

1
Global Business Flows

Mirjana Radović-Marković

1.1 Introduction

Globalization is shaping our economic, social and political realities in numerous ways. Above all, it has a major impact on the development of global finance and financial markets, the dissemination of knowledge through improved communication conditions, the expansion of multinational firms and the decentralization of economic activities within and between firms, the development of new forms of employment and job opportunities and the reduction of barriers to trade and investment. When organizations integrate with one another, they cross local boundaries and simultaneously contribute to the economies of several countries. Based on the opinion of many scholars, globalization has interrupted previously strong local and regional economic identities of countries (Sánchez, 2010; Radović-Marković, 2019; Alishahi, Refiei, and Souchelmaei, 2019). Increased integration has led to an increased need for a new type of social, political and legal regime. With this in mind, it is logical that the process of globalization becomes an inevitable starting point in all economic analyses at the national level, because modern economic development becomes impossible without accepting the trends in the global market. In accordance with these requirements, specific objectives of this part of the study have been formulated, relating to:

1. Determining the degree of integration of Montenegro and other Western Balkan countries into the global business flows and their positioning in the global market.
2. Exploring the impact of globalization on economic development; competitiveness; innovation; entrepreneurship development and new forms of education, work and employment as well as the resilience of states and enterprises to external and internal shocks (contagions, earthquakes, climate changes, etc.).

1.2 Basic Concept and Different Dimensions of Globalization

The concept of globalization is widely set and as such encompasses a number of disciplines analyzed from different perspectives.

For the purposes of this study, the focus will be on how globalization reaches every aspect of economic and social life. This cause-and-effect relationship is often articulated without empirical evidence, which leaves a correlation between globalization and its effect without any measure. However, without measuring the effects of globalization, valid conclusions cannot be drawn, but they remain at the level of arbitrariness of interpretation.

The economic aspect of the KOF globalization index measures the flow of goods, capital and services over long distances as perceptions that accompany market exchanges. In addition to actual trade flows and foreign investment, it also covers the extent to which a country restricts capital and trade flows. On the other hand, the social dimension of globalization measures the spread of ideas and information.

Given the large number of theories related to the phenomenon of globalization, they need to be systematized into theories that come from the views of classical scholars and those of contemporary thinkers. The difference between the two approaches is that classical scholars have discussed cultural and sociological views, whereas contemporary scholars have emphasized the economic and political aspects of the phenomenon of globalization (Table 1.1).

Table 1.1 Overview of globalization theories: Classical and contemporary theories

Theories	Authors	Characteristics	Sources:
Modernization theory	Max Weber and Talcott Parsons	It is based on economic development, political and economic stability and democratization of society	Nash, K. (2007). Contemporary Political Sociology: Globalization, Politics and Power. Oxford: Wiley-Blackwell
The theory of postmodernism	Jean-François Lyotard, Jacques Derrida and Fredric Jameson	Postmodernism is directly connected with the process of globalization. The representatives of this theory emphasize the importance of knowledge. They also focus their attention on the economic and cultural aspects of globalization.	Nozari, H.A. (2005). The Formulation of Modernity and Post-modernity. Tehran, Iran: Jahanneghsh Press. Harvey, D. (1989). The Condition of Postmodernity: An Enquire into the Condition of Cultural Change. Oxford: Wiley-Blackwell.
Hyperglobalist theory	Thomas Friedman	The hyperglobalist approach is based on the view that the world has entered a ‘global age’, legalizing the dominance of ‘global capitalism’. The logic of the hyperglobalist stance is based on ‘neoliberal capitalism’.	Tikly, L. (2001). Globalisation and education in the postcolonial world: Towards a conceptual framework. Comparative Education, 37(2): 151–171. Held, D. (2004). Democratic accountability and political effectiveness from a cosmopolitan perspective. Government and Opposition, 39(2): 364–391.
Dependency theory	Raul Prebisch	Globalization is linked to multinational corporations, international commodity markets, foreign aid and foreign investment.	Ferraro, V. (2008). Dependency theory: An introduction. In Giorgio Secondi (Ed.), The Development Economics Reader. London: Routledge.
World-systems theory	Immanuel Maurice Wallerstein	This theory places emphasis on capital-intensive production and trade dominance. According to this theory, the world is divided into central countries, semi-peripheral countries and peripheral countries.	Robinson, W (2011). Globalization and the sociology of Immanuel Wallerstein: A critical appraisal. International Sociology, 26(6): 723–745. Available at: http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.918.9776&rep=repl&type=pdf (accessed on 21 March 2020).

Source: Author.

1.2.1 Globophilia and Globophobia

Globalization is one of the most widely debated issues of the present age. Generally speaking, the debate involves those who are supporters of globalization or ‘globophiles’, as opposed to those who do not support global processes or ‘globophobes’. Namely, on the one hand, there are ‘globophiles’ who believe that globalization connects the world and brings many economic benefits to countries that are well integrated into international business flows. For them, globalization is a continuation of modernization and a driver of progress, increased wealth, freedom, democracy and happiness. Further, it encourages more trade and increased capital inflows among nations. For example, businesses may seek their financing from foreign banks offering the most competitive interest rate (Bhagvati, 2005).

Our recent research has shown that the effect of economic globalization depends on the GDP level of a country, regardless of its size (Radović-Marković and Tomaš, 2019). The relationship between economic globalization and economic growth is important especially for economic policies (Samimi and Jenatabadi, 2014). Specifically, the impact of globalization on the economic growth of countries could be altered by a series of complementary policies such as improving human capital and the financial system. The effect of complementary policies is very important, as it helps countries be successful in the globalization process. Although Nobel laureate Krugman (1993) agrees that improving the financial system can contribute to the success of the globalization process, he emphasized that international financial integration is not a major engine of economic development.

By increasing market size through globalization, countries can benefit from economies of scale, lower costs of exploration and knowledge dissemination. In addition, some researchers argue that the effects of the impact of globalization on economic growth depend on the economic structure of countries during the globalization process.

The greatest ‘globophobes’ believe that globalization is a means for developed nations to colonize developing countries through economic control and that these countries are helpless victims of globalization. In support of this claim, they argue that globalization enables developed countries to exploit the natural resources of developing countries and deplete nonrenewable resources. Many have identified globalization as a major contributor to inequality among countries, and seen as particularly responsible are multinational corporations, which are in constant search for cheap labor and high profits (Ritzer, 2007). Specifically, global companies build mutual benefit relationships that cross national boundaries (Armstrong, 2020).

Some economists have singled out an increase in poverty, increase in the fiscal deficit and, above all, more pronounced regional differences in the world as a consequence of global processes (Kalyan, 2000). The worsening of economic inequality has called into question the ability of economic globalization to develop lagging regions (Feffer, 2020). Particularly, according to a number of scholars, globalization has a detrimental effect on economic growth in countries with weak institutions and political instability (Borensztein, De Gregorio, and Lee, 1998).

Complementing the negative view of global processes, ‘globophobes’ claim that globalization produces the undermining of democracy, cultural homogenization and increased destruction of natural species and the environment (Appadurai, 1990).

Bello (2007), one of the leading critics of globalization, suggested that countries place emphasis on trade at national rather than global levels to protect local economies, improve quality of life and support regional rather than global institutions.

The economic crisis of 2008 showed a close link between the crisis and the decline in the level of economic globalization in the world. Accordingly, the question arises whether the new economic crisis of 2020 caused by the coronavirus will again slow down the processes of economic globalization or even lead to the end of globalization, as some predictions have emerged. Such statements are corroborated by the fact that when the world is faced with a pandemic and the threat of financial collapse in 2020, each country for itself has been forced to seek a solution to closing their national borders. Further, as it moves around the world, the corona...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Contents
• List of Tables
• List of Figures
• Preface
• Acknowledgment
• PART I Theoretical Perspectives of Globalization
• PART II Globalization and Entrepreneurship
• PART III Digital Entrepreneurship
• PART IV Changing Nature of Work in the Digital Era
• PART V Organizational and Entrepreneurial Resilience
• PART VI Economic and Social Impact of Global Ecosystem on Progress in Montenegro
• About the Authors
• Index