Economic consequences of globalization

The role that the governments play in individual countries has changed as a result of globalization. This acceleration in growth is even more remarkable given that the rich countries saw steady declines in growth from a high of 4. Key factors in achieving universal competition is the spread of knowledge at the State level through education, training and technological advancements.

Is there any way of ameliorating the potential negative effect on income distribution through increased possibilities of tax evasion and a consequential incentive to limit taxes on mobile factors that I discussed above.

The fair trade movement works towards improving trade, development and production for disadvantaged producers. The development of technology has led to the drastic reduction to the costs of transportation, travel and communication after World War II.

Globalization: The Concept, Causes, and Consequences

Consequences Globalization certainly permits an increase in the level of global output. Industrialization is a process which, driven by technological innovation, effectuates social change and economic development by transforming a country into a modernized industrial, or developed nation.

References Cline, William R. Above all, ideas have increasingly become the common property of the whole of humanity. This results in factories with harsh labor conditions, low wages, and job insecurity.

Companies will deliberately move into countries with the most relaxed laws and regulations for labor standards allowing them to do whatever they want. Race to the bottom Globalization is sometimes perceived as a cause of a phenomenon called the "race to the bottom" that implies that multinational companies are constantly attempting to maintain or increase their influence in countries that are already reliant on foreign investment alone.

Wages and Inequality As companies outsource work to poorer countries in pursuit of cheaper labor, many of the poor in these developing countries are able to find work at wages that are finally able to sustain their families.

The Human Development Index comprises three components: A globalized world is going to have to deal with a broader policy agenda than simply liberalization if the outcome is to be reasonably equitable. Multinationals tend to target export dependent countries. We mean that the whole of the world is increasingly behaving as though it were a part of a single market, with interdependent production, consuming similar goods, and responding to the same impulses.

On the other hand, some of the effects of the communications revolution must surely have had a disequalizing effect on income distribution in these countries: Here are four ways that globalization has had a positive impact on the world economy: In general, vast numbers of the Chinese people have been able to rise out of poverty as they have found better paying jobs and work for both domestic and foreign companies.

It is clearly the availability of cheap, rapid and reliable communications that permits such phenomena, just as this is the key to the integration of the international capital market.

Alongside globalization, outsourcing developed which increased corporate power. Access to a greater variety of foods, especially those foods that are processed, have led to increased rates of obesity in many poor countries, which, in turn, can lead to health issues such as diabetes, cardiovascular disease and high cholesterol.

When countries remained relatively closed off to trade and interaction with other others, they remained isolated from health risks as well. Companies will deliberately move into countries with the most relaxed laws and regulations for labor standards allowing them to do whatever they want.

Access to a greater variety of foods, especially those foods that are processed, have led to increased rates of obesity in many poor countries, which, in turn, can lead to health issues such as diabetes, cardiovascular disease and high cholesterol.

It will be clear from what was said above that I see little reason to doubt that the citizens of a developing country can expect to benefit from being open to trade and FDI.

How Globalization Affects Developed Countries

Also, the non-globalizing developing countries did much worse than the globalizers, with the former's annual growth rates falling from highs of 3. One can certainly envisage such measures, although they will require extensive international agreements, in the form of tax-information sharing and potential withholding of taxes on income earned by foreigners.

The movement is taken to decrease the wrongdoing and gain the profits for labors.

The Effects of Economic Globalization on Developing Countries

As countries opened up, both products and individuals began to travel, taking diseases with them. This suggests that a promising strategy for eliminating such barriers is to seek a coalition with Northern consumers, rather than to engage in North-bashing which will simply alienate potential Northern allies.

Additionally, free trade may drive up production and labor costs, including higher wages for more skilled workforce, which again can lead to outsourcing of jobs from countries with higher wages. Labor markets have been around as long as commodity markets. ECLAC states that in order to create better economic relations globally, international lending agencies must work with developing countries to change how and where credit is concentrated as well as work towards accelerating financial development in developing countries.

Rappa agrees that economic globalization is reversible and cites International Studies professor Peter J. Corporations manage their supply chain to take advantage of cheaper costs of production. As a result, inequity develops among the working class creating a divide within the local economies. When businesses started to venture across international borders, what they often did was introduce a new standard into the global marketplace.

Get this from a library! Globalization and the economic consequences of terrorism. [Brenda J Lutz; James M Lutz] -- This book analyzes the effects of economic, social, and political disruptions that have come with integration into the global economy for countries in five different regions and the developing world.

Components of Globalization. The components of globalization include GDP, industrialization and the Human Development Index (HDI).

The GDP is the market value of all finished goods and services produced within a country's borders in a year, and serves as a measure of a country's overall economic output. Globalization may be inevitable over the long-run, but there are many bumps along the road in the short-run.

These bumps are often spurred by economic crises or some of the negative consequences of globalization, but in the end, the world has always managed to learn that protectionism can make a bad situation worse.

Economic globalization is one of the three main dimensions of globalization commonly found in academic literature, with the two others being political globalization and cultural globalization, as well as the general term of globalization.

Economic globalization refers to the free movement of goods, capital, services, technology and information. It is the increasing economic integration and. Whereas globalization is a broad set of processes concerning multiple networks of economic, political, and cultural interchange, contemporary economic globalization is propelled by the rapid growing significance of information in all types of productive activities and marketization, and by developments in science and technology.

Jun 30,  · The debate continues to rage over whether or not global expansion of corporations and the opening of economic markets in developing countries is good for the poorest of the world's nations.

Economic consequences of globalization
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How Globalization Affects Developed Countries