More handpicked essays just for you.
Globalization and its impact
The effects of globalization on world economies
Economics importance globalization
Don’t take our word for it - see why 10 million students trust us with their essay needs.
Globalization has been driven essentially by several minor factors varying from cultural, economic, political and ecological concerns, however, it’s being supported by the two macro factors underlining the trend towards superior globalizations. The two major drivers of globalization are; declining trade and investment barriers and the role of technological change (Hill, Cronk & Wickramsekera 2014). With the incorporation of innovative economic theories, I will discuss the key drivers of globalization since the 1970s. Furthermore, I will demonstrate how these key drivers have changed the nature of international business and determine the outcome. Declining trade and investment barriers refer to diminishing high tariffs on imports of industrial …show more content…
Porter 's competitive advantage theory which emerged in 1990 contradicts that the theories of comparative advantage and Heckscher-Ohlin cannot provide an explanation as to why some countries prosper and others fail to succeed in international competition. He distinguished four qualities that advance or hinder the creation of competitive advantage; Factor endowments, demand conditions, relating/supporting industries and firm’s strategy, structure, and rivalry. So far, Porter’s study hasn’t been appropriately experimented to know how well it holds up (Hill, Cronk & Wickramsekera 2014). Regardless of this, the key drivers of globalization have transformed the nature of international business and possibly be the reason behind the success of international business since 1970. The decline in trade and investment barriers has enabled the international business to growth further. Once a business exports/imports goods from other countries or commits to FDI, it becomes an international business. Lowering trade and investment barriers are characteristics of international business. This allows growth in FDI and moves towards regional economic integration. The advantages of the political driver on international businesses include; the diverse variety of goods available to consumers through the new trade theory, low prices, economic growth and competitive advantages. The disadvantages are; potential risk factors, foreign debt, exchange instability and high cost. Weakening the barriers also permits international businesses to station production at the ideal area for that activity. Thereby, a firm may outline a product in one nation, produce segment parts in two different nations, manufacture in another country and afterward trade the finished product around the globe. Technology has altered the nature of international business by introducing
The main idea of this article is that there were two major waves of globalization, both of which were “superficially similar, but fundamentally different.” The first wave occurred during 1870-1914 and the second from 1960 to present. The superficial similarities between the two include the aggregate trade-to-GDP ratio and capital flow-to-GDP ratios in addition to the importance of reductions in technical and policy barriers to international trade. The fundamental differences, on the other hand, are the impact reductions had on trade and the economic beliefs and initial conditions of the two periods.
In the book Globalization: A Very Short Introduction by Manfred Steger and the reprint Globalization and the Impact of American Popular Culture Abroad by Carl Guarneri, the point is made how recognized globalization has become and how much it has affected citizens around the world. Some of the debates over the effects of cultural globalization are: the West and its multinational corporations after World War II, what it promotes to the world’s people, the views of consumer capitalism’s effects and the repercussions of the globalization of culture.
When the term “Globalization” is discussed, most academics, scholars, professionals and intellectuals attempt to define and interpret it in a summarized fashion. My main concern with this approach is that one cannot and should not define a process that altered decades of history and continues to, in less than 30 words. Global Shift is a book with remarkable insight. Peter Dicken rather than attempting to define the commonly misused word, explains Globalization in a clear and logical fashion, which interconnects numerous views. Dicken takes full advantage of his position to write and identify the imperative changes of political, economic, social, and technological dimensions of globalization.
The Millennium report advocated that the greatest challenge we face today is to ensure that globalization becomes a positive force for the entire world's people, instead of leaving billions of them behind in foulness. Inclusive globalization must be built on the great enabling force of the market, but market forces alone will not achieve it. It requires a broader effort to create a shared future, based upon our common humanity in all its diversity. Today the most significant changes in the world economy over the past decades are the upsurge in globalization of markets and industries. There are numerous forces that have greatly contributed to the rise of globalization, factors such as reductions in multilateral and regional trade barriers, mergers and acquisition that enhance assess to new markets and competition. Globalization can be claimed to have major and crucial positive implication on the businesses today.
the author offers a theoretical framework, which outlines the underlining factors that contribute to national competitiveness. Michael Porter’s work was met with contrasted views. While some academics praised the model for its wealth of information and the convenient framework it generated (Greenway, 1993), many other academics in international business criticized the model for its theoretical flaws and lack of empirical evidence.
This study focuses on discussing the criticism of Porter’s model of national competitive advantage. In order to fully discuss the limitations of Porter’s model of national competitive advantage, the determinants in Porter’s diamond model should be explained. Therefore Porter’s diamond model and its elements are analyzed in the first part of the study while rest of the study is explaining the limitations of the Porter’s diamond model that are late development theory, the role of the state, multinational enterprises, foreign direct investment, national competitiveness and history.
Michael Porter introduced a model that allows analysing why some nations are more competitive than others are, and why some industries within nations are more competitive than others are, in his book The Competitive Advantage of Nations. This model of determining factors of national advantage has become known as Porters Diamond. It suggests that the national home base of an organization plays an important role in shaping the extent to which it is likely to achieve advantage on a global scale. This home base provides basic factors, which support or hinder organizations from building advantages in global competition. Porter distinguishes four determinants: Factor Conditions The situation in a country regarding production factors, like skilled labour, infrastructure, etc., which are relevant for competition in particular industries.
Science Initiative Group Institute for Advanced Study, 2007, Globalization: Trends and Prospects, Available from: http://sig.ias.edu/files/Egwang-_Welcome.pdf
In today’s continuously changing world, many experts say that globalization is what every business, organization, and nation should seek and welcome as a positive change. However, many people are unaware of the main focus and meaning of Globalization, especially in comparison to Localization. A large number of people believe that globalization is just another common word used to refer to changes and differences that cannot be explained or accounted for. Therefore, many different activities or changes are improperly labeled to be a part of or caused by globalization.
To complete a Strengths Weaknesses Opportunities Threats (also known as SWOT) analysis presented to a developing country by globalisation, we must first understand the actual concept of globalisation itself. So how can we define this term? Joseph Stiglitz, a winner of the Nobel Prize defines Globalization as “the closer integration of the countries and peoples of the world ...brought about by the enormous reduction of costs of transportation and communication, and the breaking down of artificial barriers to the flows of goods, services, capital, knowledge, and people across borders.” Hence, we can understand that globalisation can be described as an expanding global marketplace for the trading of anything from transport of goods internationally,
Globalization is a new concept that was introduced to the world after the fall of the communist regime. Globalization has to its identity social, economic, and political reforms, .however the globalization that we are about to discuss is the term that combines the past socio-economic and political reforms and cross with them to the world where their are no boundaries, restrictions, and immobilization what Mittelman describes as ? cross-border flows of capital, knowledge, and consumer goods ? (Mittelman 1). For the world to become a one or a single entity it has to pass through a process of economic, and technological integration. The consequence of this unification is the aim of this research, positive and negative, although the negative aspects will be the dominating part.
Globalization on a broader scale, is an integration act, involving cultural, mental, political as well as economic aspects of a person, among countries. It is mostly limited to, economic integration, associated with movement of people, exchange of technology and information, trade as well as financial flows. . This is practice is clearly miles ahead, as demonstrated by the ever increasing capital flows in the world economy as well as the level of importance, the world economy has. As a result of globalization, tremendous pressure is on the nations to keep up with its demands and this has had a lot of consequences. Some pundits will tell you that these effects are only economic based,
Globalization affects this world and the people of this world in many ways. It is the idea of making the entire world like a single country.
Globalization’s history is extremely diversified and began during the beginning of civilization. Now we live in a world that is constantly evolving, demanding people to use resources in locations that are very difficult to obtain certain resources. This could make it completely impossible to operate in these specific parts of the world. However, globalization allows people across the world to acquire much needed resources. Globalization creates the opportunity for businesses to take advantage and exploit the ability to take part of their business to a different country. Nevertheless, globalization is part of today’s society and will be involved in virtually all situations.
Globalization is a global process that is changing the world. I would also like to discuss what are the benefits and drawbacks of globalization in the world from different perspectives.