As far as the schema language itself is concerned any global element can be used as a root element, but it is intended that the application or processor could be parameterized to check. So, the root of the validation need not be the root of the instance document. It then goes on to say exactly how and against which declarations. By the way, the detailed rules give the processor a choice of validating the element against some particular identified element declaration, some particular identified complex type, or to use the mechanisms of strict, lax etc. to determine what to validate based on what declarations happen to be available. All of this is explained at xmlschema-1 .
Global elements are available for reference when building content models.
Another way to think about this is that global element declarations in schemas give you the same capabilities as the element type declarations in XML 1.0 DTDs. Local declarations are an enhancement in schemas, allowing the same name to be used for different purposes according to context. If you were doing a straight conversion from a DTD to a schema, most likely all the resulting element declarations would be global.