Globalization of the Economy

As George Soros, the Chairman of Soros Fund Management said: "I think there 's a lot of merit in an international economy and global markets, but they 're not sufficient because markets don 't look after social needs" (2000). Globalization allows businesses to grow due to the elimination of stringent trade restrictions and tariffs. Globalization also allows undeveloped nations the opportunity to flourish by creating jobs that were previously unavailable. As Lechner states in his Globalization Debates - Good vs. Bad, those in opposition believe that globalization is dangerous due to the “...inequities of oppressive global capitalism” (2000-2001). So, what are the upsides and downsides to globalization?

Globalization is something to be said to have either brought the world together or brought us apart. It is a debate that has been going on since it first began and how it is has affected the world has brought controversy as well. Mainly, this paper will be focusing on the economic growth that globalization has influenced. As the world is developing and has been over the past decades, certain countries have had a significant increase in economic growth but it is said that there are risks and effects of globalization. This paper will talk about how globalization effects developed countries and what countries need in order to benefit from it.

The increase in economic transactions across the globe raises both the world GDP and development of new industries. This process has a positive impact on globalization and in leading the economies into more profit. Some people have a concern that globalization negatively affects individuals along with the nation's society. Globalization creates economic interdependence which lessens the role and dependence on the national government. With globalization, powers of national government shrink and the governments become less important.

There are many ways to look at and understand modern globalization. In general terms, globalization means that the world, as a whole, is leading to a more utopian society, meaning that the globe is become very interconnected and similarities are growing between different regions and cultures of the world. Globalization is a phenomenon that has been evolving since before 10,000 B.C. This constant evolution can cause many problems, but it can also solve many issues positively as well. Development of any country, however, seems to be a key issue when discussing globalization. Globalization and development present two different factors in the world today. Many countries are lacking in their own development while the world around them is becoming more developed and globalized. Globalization hinders development because with globalization, less developed countries depend on more developed countries to help them to sustainability and self-reliance.

Globalisation is the process of the globe interconnecting through integration of communication, trade, investments and production in the global market. The development of Technology through the industrial revolution, is one the most significant factors behind globalisation. Globalisations removes the limits to business, the trade of goods and services worldwide. This allows business cooperation’s to expand in foreign markets. Global trade is a powerful force that has been made possible through the process of globalisation, and has opened up the gates to the global economy. There are many advantages and disadvantages to the ‘good’ force of globalisation. It has developed the economy to a global scale and given nations the opportunity to

As globalization increases it will continue to undermine the sovereignty of states. Globalization means states becoming more interdependent. Depending on other countries gives them more power, therefore they are more likely to act for the welfare of other people even if they are in a different state. This has been the case many times in mass genocides or even in the case of civil wars within countries between two different groups. The globalization of world powers started the United Nations to protect people from mass murders of people. Another reason that the sovereignty of states is diminishing is the mixed culture and ethnic minorities. Several places throughout the world are trying to become their own states without the approval of the state they are already living in, therefore they are fighting for it. Globalization had brought these people together so they aren’t

With the development of science and technology as well as transportation, economic and trade globalization in gradually, most companies are not satisfied with the domestic market, and began to open up markets in other countries, which is the origin of multinational enterprises. However, since the environment of the market is different from the host country, such as natural conditions, socio-cultural, or customer needs, which is particularly difficult to deal with the situation when to enter the market of a country, it will need to face the corresponding political risk. Political risk is a type of foreign exchange risk, thence, a prerequisite of political risk and foreign exchange risk of the occurrence of a prerequisite is the same, namely businesses or investors must hold foreign direct investment (Foreign Direct Investment), otherwise, there would not be political risks (Jensen, 2003). Therefore, for multinational enterprises, the economic benefit was on the most important position, and even beyond the political relations such as social system, human ideology, or challenge the traditional, however, for the country to say that in terms of national security goals happen with the economic interests if they have conflicting objective, the state will first meet the security objective, it would be more stressful for multinational enterprises in political risk.

The end of 20th century, more and more business are growing constantly, business are wanted to go global by expanding their business overseas. In today’s global market it reflects among the measures of economic activity going in the world economy. For the worldwide economy to be existing a rising share of the financial actions occurring between countries to country who live in distinctive nations. It can involve trade, investments, production labour and also viewing its economic situations in nations and between nations. Globalisation has similar content as global market but it is more abroad. Globalization can be considered as the growing economic and financial integration of economies around the globe.

Globalization has become the new term for the international economy, which makes the nations have become more reliant through the flow of services, goods, and financial resources since 1970s (Gereffi et al., 2001). The term “globalization” was not created until the second half of twentieth century, it has a longer history. The word “globe” originated from the fifteenth century etymologically, which is derived from the Latin word “globus” and started to indicate an illustration of the earth hundred years ago (Smelser and Baltes, 2001). The word “global” arrived in the late seventeenth century and began to entitle “world scale” term in the late nineteenth century, also to its earlier meaning

Global stratification can be defined that globe countries and areas are not on an equal footing in the process of economic, political and cultural globalization (Andersen & Taylor, 2006). The economic globalization has exacerbated the imbalance of world economy and has widened the wealth gap. Globalization has brought unfair relationships between developing countries and developed countries. Gao (2000) noted that economic globalization has expanded the gap between South and North. And it has brought huge shocks to national economy of developing countries. The international economic organizations like the Word Bank, IMF and WTO are in the hand of developed countries (El-Ojeili, C. & Hayden, P., 2006.). All the principles, institutions and sequences for the world economic operation are made by them. (Sklair, 2002)What’s more, the economic, technical and management advantages that is owned by Western countries cannot be easily and fully surpassed by developing countries.

The globalization of the economy encourages organizations to achieve greater market coverage, which allows companies to define or redefine its strategic posture. Thus, there have been so intense outsourcing processes that enable organizations to address the new challenges and therefore, organizations must develop skills and abilities that enable them to cope with the demands from the environment.

The concept of globalization has become a prevalent phenomenon in the past two decades because of the changes it has brought and the adoption of its strategies by multinational corporations or companies. The economic changes of globalization include the strengthening of economic inter-dependence, internationalization of production, and enhanced mobility of transnational corporations. On the other hand, trade liberalization, privatization, and deregulation are the ideological changes emanating from this concept.

With the emerging of Globalization throughout the world most developing countries have not seen the positive impact that other Developed countries have seen with Globalization in either economic or political stability.

Globalization is the process in which we as humanity are coming together to form a global economy around all sorts of different infrastructures. “The globalization process implies the incorporation of national economies, cultures, political systems and various identities of capitalist system which require the removal of all hurdles to cross-national interaction and exchange often created earlier by protectionist states” (Aamir, 1). Globalization is the greatest thing to happen to us as humans, we will form together instead of being pushed apart. Companies trade with each other from different countries, this allows a wider market for both participants and makes more jobs on both sides of the trade, giving economic structors for countries in poverty. This joining of countries will allow a hermans period of our history and become the beginning of a new age where we do not fight each other for resources but work together to gain more than land or wealth. Many are concerned that these changes will leave the poor behind to become dust in the wind, but there are many global institutions that are helping to keep this from happening. Some of these Institutions like the World Bank(WB) help by giving money to countries in poverty to allow them to grow and prosper like other countries and become part of this global phenomenon. Along with these Institutions, countries that are more fortunate are attempting to help the global trade process by creating promising treaties and methods of

In today’s world, with a few notable exceptions, nearly everyone in every region of the world has access to the same products, information and services. A long-distance relationship is no longer so distant, since each party involved in the relationship can communicate through Skype, Facebook or through any of the vast amount of social media available. A person in Easter Island, one of the most remote inhabited islands in the world, can go to the other side of the world and travel to Canada. An economic crisis in Argentina could affect the economic landscape in Brazil. A person in Chile or Peru can buy an Abercrombie and Fitch t-shirt because this transnational corporation decided to expand its market to developing countries, or as you might prefer, to emerging economies in South America. Although many of these examples might be trivial, these are the consequences of globalization.