Globalization is the increasing interaction of people states or countries through the growth of international trade and investment. Globalization has many effects both positive and negative. As we dissect both sides of its impact we may be able to come up with a definitive solutions as to which side of its effects prevails. We shall begin by looking at its positive effects.
Globalization leads to more efficient markets. Globalization exposes manufacturers to prices all around the world which then allows manufacturers to gauge more efficient prices to purchase raw materials and allow s for more favorable prices which allows for better prices of their products.
Globalization has aled to increased competition among various industries. competition is good in the sense that it allows for better products and prices as industries do not want to be priced out of the market.
Globalization has created access to foreign loans by developing countries. This monies can be used in the development of the various sectors of the economy that are crucial in the development and sustainability of the country.
Globalization allows for easier communication between countries which helps to foster relationships and trust among countries. This in turn creates better relationships and decrease chances of war between countries.
Globalization has led to increased employment opportunities. Through globalization many industries have emerged which leads to creation of employment. this in turn leads to increased living standards.
Globalization leads to economic development of countries as it allows for development of new technology, increased importation and exportation which is a source of income exposure to more efficient methods of production.
Globalization has helped to reduce trade barriers between countries. this in turn helps countries to expose their products in the international market which also helps in advancement of innovation and creates income for developing countries.
Globalization has helped in innovation of products, technology and infrastructure to facilitate trade. it has allowed for innovations such as the internet, social networking sites, modes of transportation such as air and sea transport which also helps to make the world connected.
Now Let us explore the negative sides of globalization
Firms in developed countries outsource their manufacturing and white-collar jobs to developing countries in order to cut down on costs. This creates employment disparity and causes resentment between people in developed countries and those in less developed nations.
Globalization may have inadvertently helped to increase terrorism as it allows for free travel among borders and also easier communication which is a positive for terrorists.
Globalization also leads to cultural deterioration. Globalization helps to expose people to various cultures which then leads to erosion of traditional culture and eventually even their complete eradication.
Globalization has also led to interdependence among economies as many stakeholders get to invest in a country's economy. This also means that collapse of one country's economy could mean collapse of another which is a disadvantage.
Globalization makes it impossible for regulators in countries to oversee the global impact of their regulations as some regulations may end up being counterproductive.
In conclusion Globalization has both positive and negative impacts but the good far outweighs the bad.
Globalization is one of the most debated issues in the recent times. The term can be defined as the process by which business organizations develop international influence and start operating in other countries, in addition to the home country. It also encompasses the acceleration of economic, political, social, cultural, and ideological processes, which are aimed at altering people's processes of the world. To many, it considered as one of the best thins that ever happened in the world. proponents of globalization allude that increasing interaction between and among nations plays a critical role improving the way businesses are operated and the lives of people. On the other hand, there are those who hold the view that globalization has never been good. this paper seeks to critical discuss the positive and negative effects of globalization.
There are four main positive effects of globalization. First, globalization increases competition. an increase in competition among producers plays an important role in improving the experiences of consumers. Producers are compelled by the competition to produce quality products that are affordable, thus increasing value to the consumers. Second, globalization leads to the creation of more efficient markets. An efficient market exists when there is equilibrium between what the consumers are willing to pay for and what the producers are willing to sell at. Business organizations are, therefore influenced to adopt efficient techniques of production, thus reducing potential waste. Third, globalization increases wealth equality among the world economies. Wealth is made to flow from one nation to another in the form of creation of job opportunities, and the establishment of new markets, thus increasing the total sales. Fourth, globalization promotes security among nations. The interactions between business organizations and consumers in different parts of the world influences them to have a common purpose and interest in every country. People from different parts of the world are also influenced to put in place measures that will not improve the security of their nation, but also in those countries where their interests are vested.
On the other hand, there are several negative impacts of globalization. First, while outsourcing of labor creates employment to one country, it may create unemployment in the receiving country when the locals lack jobs because the available ones have been taken up by foreigners. second, the increase in interaction among people from different countries with varying cultural backgrounds may lead to the erosion of a nation's most valued cultural values and practices. For example, interaction with business partners from a country where polygamy and homosexuality have not been legalized may influence one to question the values in their home country, and possibly deviate from those values and practices. Third, globalization increases the spread of diseases among nations. An infected person from country travelling top a foreign country could leave the citizens of the visited country infected with the same disease. Additionally, foreign visitors to a country are likely to take home some of the air-borne diseases in the visiting country. Fourth, globalization contributes to the collapse of small and medium enterprises. when multinational corporations set up their operations in a developing countries, they are able to provide better goods and services at affordable prices because they enjoy economies of scale, economies of scope, and economies of experience. Small businesses are, therefore forced out of the market due to the inability to compete.
In conclusion, globalization has both positive and negative effects. Although it promotes world security and market efficiency, it also leads to the collapse of small businesses. Governments, business organizations, and consumers have a role to play in ensuring the positive effects of globalization are maximized to leverage the negative effects, in addition to avoiding them.
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