Effects of Globalization
Globalisation is the process of making it easier to connect from on point of the world to another, in terms of communication and transport. This has made it possible for people from all parts of the world to communicate, share cultural heritages and to do business around the world. In this regard, globalisation has led to numerous issues, some positive and others negative. On the positive side, globalization has opened economic opportunities for many individuals, businesses, and even countries.
Rationale for the effects
Businesses and countries can now easily get markets in places that are very far from their geographical location, and as Cowen (115) says, the customer is no longer limited by the geographical location of his whereabouts. At the same time, they can source materials from far places and achieve strategic advantage. The most common trend in the use of global resources by businesses is the process of exporting jobs in order to take advantage of cheaper labour in the less developed parts of the world. This process, dubbed as Business Processes Outsourcing, has helped many businesses from the developed world to reduce their cost of production by taking advantage of cheap, efficient labour in developing countries such as India, China, and Brazil.
However, this has both advantages and disadvantages. For instance, when such firms export these employment opportunities to these countries, they leave a gap in the local economy. Apple Inc., for instance, has been accused of not being responsible due to its habit of exporting employment opportunities while in the rates of unemployment are ever getting higher in America. At the same time, while globalisation has increased business opportunities for some businesses, it has also led to increased competition. In the earlier days, a manufacturing firm in the United States would only have to worry about competition from other firms of the same type in the United States. However, in a globalized world, firms, big or small, have to worry about competition from firms in very far places.
Globalisation, for instance, almost pushed Japanese auto-manufacturers from the market after the Second World War, because, at the time, the Japanese auto-manufacturers could not compete with the high quality offered by European and American manufacturers. Globalisation is affecting not only economics of the world, but also culture and politics. In a globalized world, it is easier for countries to be more involved in the politics of other countries through war, foreign policy and diplomacy. As globalisation intensifies, regional cultures are being replaced by a blend of cultures which is becoming a global culture. There are other more serious issues which are brought about by globalisation and which must be addressed, rather than be conformed with. For instance, as Rodrik (195) says, globalisation makes it harder for governments to create and enforce a regularity environment, leaving many citizens at risk of exploitation by large organizations.
Newer generations will be blinder to the cultural and ethnic/racial differences between them because, in the face of globalization, these differences are fading off. It is through globalization that good social structures such as democracy, positive capitalism and religious tolerance have been absorbed in the new world. This will lead to a more cohesive and thus a more peaceful world. In this regard, it can be said that globalization is contributing to a better world, economically, politically, and even socially.
Cowen, Tyler. Creative Destruction: How Globalization Is Changing the World’s Cultures. Princeton, NJ: Princeton University Press, 2009. Print.
Rodrik, Dani. One Economics, Many Recipes: Globalization, Institutions, and Economic Growth. Princeton, NJ: Princeton University Press, 2008. Print.