Understanding the concept of Globalisation

Evaluating the pros and cons of Globalisation Essay

Coined in the latter part of the 1980s, Globalisation as a term was introduced by Theodore Levitt. The term has since then revolutionised the global business environment. With this term, people around the world have been able to do business with each other. Moreover, the global business scenario's implication has brought in various opportunities for the world's people. It has increased the exchange of goods and services in the global environment. This has more importantly boosted the ease in communication between the different worlds, cultures, and societies. Not to forget, Corporate Social Responsibility is yet another advantage of globalisation, which has helped companies realise their duty towards the environment. 

Globalisation, in simple terms, can be defined as the process which has enabled the easy and fast movement of goods and services across the globe. It also includes the exchange of talent, technology, capital, and cultural practices across the borders.

Globalisation, in simple terms, can be defined as the process which has enabled the easy and fast movement of goods and services across the globe. It also includes the exchange of talent, technology, capital, and cultural practices across the borders.

Causes of global warming

Effects of globalisation


Globalisation is one of the major developments that the world has witnessed in recent decades. It has not only uplifted the living standards of the people but has also brought in numerous opportunities for them. Also, there is a list of major factors affecting international business, mostly due to globalisation. However, here is a list of effects globalisation has made on the world and its economies:

  • Increased job opportunities: The exchange of human resources overseas has given wings to the job options. People now travel from less developed to developing or developed countries in pursuit of better jobs. Moreover, the remunerations paid to the talents are also at par and enjoyed by the employees.

  • Improved financial conditions: Globalisation has impacted greatly on the finances of individuals and families across the globe. With better jobs and business growth in hand, people have got the opportunity to flourish their financial conditions. People from developing countries have gained momentum in terms of better lifestyles and spending capabilities.

  • Multiplying business growths: The blooming cycle of good jobs, high pay scale, upscale lifestyles, higher spendings has given a boost to the business industry as well. The business class in the countries has also experienced a greater chance of establishment and growth. In fact, many new business ventures have been incorporated in recent years. This is much because of the enhanced opportunities created due to the concept of globalisation. When people see better opportunities in the world around them, they feel safe investing their money. These finances then help them flourish in the future, which further leads to a much bigger and influential cycle of advancement and interdependency.

  • Higher quality of life: With all these changes happening simultaneously, the world's people now witness a comparatively better quality of life. This covers the varied aspects of human development and safety. In fact, education, hospitality, medicine, civil services all these sectors have seen a considerable upward shift in their service quality.

  • Increased competition levels: With globalisation, the world has become a single stage, where the best talents are indulging in healthy competition with each other. This leads to not only improved quality of work but greater enthusiasm in people to perform even better. These positive changes lead to the evolution of a more efficient and competent world.

  • International standards of work: With the incorporation of the MNC culture into practise, better working norms have been introduced in countries across the globe. No more workers are being treated as labourers and the office jobs are now much refined and respected in society. Also, people now see it as a mode of earning name and fame in their career. Being associated with top brands or multinational companies is now believed to be a matter of honor. All of this has boosted the confidence level of the people and has even made people love their professional life.

Pros and Cons of Globalisation in a developing country

The Pros


1. Enhancement of trade opportunities


This is one of the biggest pros of globalization. It has brought immense enhancement in global trade opportunities. Now, people are not only limited to selling and purchasing goods from the local market. They have huge access to foreign brands, products, and services available to them right within their countries. Not only this, business organizations can export their goods to foreign markets and enjoy access to bigger markets. Further, globalization has also provided people with access to goods at lower prices. For example, Chinese electronics are generally cheaper and China exports them to different countries where people get to buy them at lower prices. This way, developing countries have got the opportunity to export their products to international markets.

2. Globalization has increased employment opportunities


In developing countries: To help their people rise from poverty, developing countries need to create employment opportunities for them. Globalization is playing an important role in helping developing countries with this purpose. This is because, with globalization, MNCs have entered the markets in developing countries. They employ labour for construction and hire their employees from the respective developing countries. This way, they create multifarious employment opportunities in developing countries.

3. Globalization provides access to foreign cultures


Different regions of the globe have different cultures associated with them. Their culture inspires their way of living, eating practices, their art forms, and everything else. So, people living in different regions follow different cultural practices. For example, ‘Namaste’ is an important cultural practice followed in India for greeting purposes. Whereas, in countries like the United States, people greet each other with a firm handshake. But, as globalization is spreading its wings, people of different regions are getting to know about different regions' cultures. This awareness introduces them to new practices related to things such as food, clothing, and artwork. As a result, they get to try new things while living in their native place only.

4. Globalization gives rise to global technological advancements


Globalization is giving rise to global technological advancements. If some new technology gets developed in a particular region or country of the world, it no longer stays limited there only. Due to the expansion of trade, it travels to other regions of the world soon, and different countries adopt it. For example, Mobile banking is slowly spreading its wings in different countries of the world. As a result, developing countries are getting equal access to technology advancements as the developed ones.

5. Globalization has promoted the global hiring of talented individuals


Globalization has provided new horizons concerning the recruitment of talented individuals. Companies are now hiring not only individuals from the same countries but also internationally. They don’t mind whether the individual is from a developing country or a developed one; all they need is talent. Thus, globalization has promoted the global hiring of talented individuals.

The Cons


1. Globalization is posing a threat to cultural diversity


As discussed above, with globalization, people of different cultures are getting access to foreign cultures. They are learning about the cultural practices followed by different cultures and also adapting to the ones which they like. For example, Indians have started wearing more of western clothes over time. But, such adaptation of practices between cultures is posing a threat to local native cultures. The prevalence of new practices may make people forget their old cultural practices with the passage of time. As a result, cultural homogeneity may take place which may rob countries of their respective vintage cultures.

2. Globalization has increased the environmental threats


The environment is already in danger. Pollution, Global Warming, unpredictable climate change, Ozone Layer Depletion are examples of environmental problems that the world is currently going through. In response to this, several countries of the world have formed strict environmental laws. Thus, to operate in such countries, business organizations have to abide by the respective environmental laws. This usually makes business organizations bear some extra costs and also requires them to follow sustainable practices which require more time and effort. As a result, they prefer to set themselves up in places where there are no strict environmental laws. So, they continue to operate in a way, which poses a continuous threat to the environment. This way, globalization has increased the environmental threats

3. Globalization has brought a rise in corruption


This is one of the biggest cons of globalization. It has brought a rise in cases of corruption. According to Henley Business School's research, 85% of the managers have admitted that they had to resort to some bribery when doing business with developing countries in general. Further, after engaging in corruption for once, it gets easier for business organizations to engage in such practices in the future. Thus, we can say that globalization is making corruption spread among different countries.

4. Globalization has increased the threat of disease transfer


With globalization, people started traveling from one region of the globe to another. This has increased the threat of disease transfer from one region to another. For example, the pandemic initial outbreak of the pandemic, COVID-19 took place in the seafood market in Wuhan, China. Then, it slowly started spreading in the whole country and with the passage of time, the infection spread in almost every country of the world. This happened because of people traveling to or from China to other countries. Along with this, Chinese food and other goods also played a key role in spreading the infection to different parts of the world, as COVID-19 thrived even on goods and objects. This way, globalization has brought a significant rise in the threat of disease transfer across the globe.

5. Globalization is more beneficial for already developed countries


According to studies, globalization is more beneficial for already developed countries. This is because MNCs from developed countries enter developing countries' markets and give tough competition to the local producers. Due to their attraction towards international products, people prefer making purchases from MNCs. As a result, they make huge profits, whereas local producers suffer a loss in their income. This way, Globalization is more beneficial for already developed countries rather than the developed ones.

Pros and Cons of Globalisation in a developed country


Pros:

Globalization has a positive side for developed countries, which improves the economic growth and development of these economies. The process of globalization helps in solving various deep-seated problems of the economy. Following are the main benefits of globalization in the context of developed economies.

  • Comparative advantage: The core benefit of globalization is a comparative advantage as globalization helps countries to produce goods and services at lower opportunity costs than the other countries. The developed country may benefit from producing or procuring various goods at low costs by exporting the same from other countries, which directly provides a comparative advantage to the developed country. For instance, the United States has achieved the comparative advantage of producing semiconductors.

  • Easy access to goods and services: Globalization also provides easy access to various goods and services at low cost to many individuals by ensuring imports and exports of goods with greater ease, which also helps reduce the volatility of output and consumption of goods. Consumers also get a wider choice in various goods and services at low prices. Thus, globalization is an important factor that improves easy access to various goods and services at reduced prices. For instance, information from the United Nations Development Program highlights that G20 nations use around 86 % of their resources.

  • Through free trade and investment opportunities, the expansion: provides market expansion opportunities to domestic firms through free trade and reduced trade barriers, ensuring economic growth and development. Further, Globalization causes increased competition between the firms. It provides domestic firms an opportunity to export various products and services in the wider market, further improving economic welfare and development. Also, the developing countries often face difficulty competing with the developed countries and get harmed by the tariff protection, ensuring that globalization and free trade benefit developed countries.

  • The spread of information technology and better economic growth: Globalization also helps spread information and technology between countries through a better influx of information and technology. Also, (Zhang & London, 2011) has provided that developed countries directly get benefited through globalization through better education, technology, finance, and management.

  • The free movement of labor: Increased labour migration is one of the main benefits of globalization as globalization helps to reduce labour shortage in economies and provides sufficient human capital to fill important positions. This also helps developed countries to improve their productivity and economic growth. For instance, the UK is a highly developed economy that needs to hire nurses from the far east in order to fill the shortage of nurses in the country and to improve the quality of healthcare services.

Cons:

Some praise the concept of globalization, and some protest this phenomenon on various grounds such as job loss and social injustice. Thus, the process of globalization has its own disadvantages, which are discussed in the points as follows:

  • Loss of jobs: is one of the main disadvantages of globalization as free trade of resources, money, and individuals provides an opportunity to organizations in developed to hire employees at low prices from developing countries which directly causes loss of employment by the individuals in the developed countries. Although globalization helps increase return on capital in developed countries such as the US, it also causes decreased return to labor. The low-skill jobs in the US may also disappear due to globalization and employees' availability at low prices from developing countries. In addition to this, the technological advancement associated with globalization also results in decreased employment in the country. Moreover, US employees may also face problems with pay cuts from employers by threatening the export of jobs.

  • Social inequities: The occurrence of social inequities is another major challenge of globalisation. Large companies, wealthy people, politicians, and lobbyists may manipulate scenarios and set their own rules, regulations, and laws. Further, they may hoard the global resources for themselves, which may give rise to social inequities at the global scale or in the developed country itself.

  • Poor industrial growth: Globalisation may also cause poor industrial growth. It may also lead to the closure of the companies in the developed countries due to the availability of goods at low prices from other countries. For instance, the small US cement companies may struggle to compete in the US market and may get shut down due to the import of cement at low prices from developing countries. This also may cause higher unemployment and loss of productivity in the economy.

  • Increase in wage rates: It is another main disadvantage of globalization that may also impact companies' profitability in developed countries (Collins, 2015). Moreover, companies in developed countries such as the US may enjoy a comparative advantage for effective software development practices. However, this may cause a rise in the wages of software engineers in the country, which may directly impact the revenue of software development and software companies in the US.

  • Tax avoidance: Globalization also increases the chance of tax competition and avoidance in developed countries as large companies in the developed economy may set up their offices in regions with low corporate taxes to funnel through profits through lower tax payments. For instance, multinational companies such as Apple and Google (US-based companies) may establish their offices or subsidiaries in developing countries such as Luxembourg, where there is a shallow corporate tax rate to save their taxes. This way, the companies may pay meager taxes in the US.

Globalisation essay- sample

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Globalisation- The boon or bane?


Growth, development, and improvement may seem synonymous with each other. But in actuality, these terms are highly interdependent. It can be taken about the progress of either a human being or even the entire nation or in interrelation to both. If a human being gets the opportunity of growth, he develops new mediums for improvement, and thus, the entire society experiences positive change and expansion. One such surge in the lives of human beings and the world's businesses began when society experienced the implication of globalisation. It not only empowered the developing nations to grow infinitely but also refined the sources of employment. On the other hand, globalisation has also led to some deeper challenges for the developed nations. This article discusses both the scenarios and tries to evaluate which one has a stronger impact.

Thesis statement: International trade and the expansion of local businesses globally have brought in great positive changes in the business environment. However, it has also proven to be disadvantageous for many communities or nations. This article evaluates the two sides and checks if Globalisation has proven to be a boon or bane for the world. It also checks on the following points:

  • How has globalisation been advantageous for the world?

  • For which types of nations, Globalisation has created challenging situations?

Firstly, the export and import trade on a global level has benefited many markets. Essentially, the developing nations have been able to conquer the business in the overseas markets because of their competitive advantage. With the concept of globalisation in practice, many small and big regional companies started expanding and exploring options in the international market. With the businesses surging high, a great peak has been witnessed in the GDP and the economic growth of developing nations like India, China, Bangladesh. These have been regarded to export high-quality products at favorable prices. Also, the popularity of the goods keeps increasing as it spans its wings across multifarious nations. With the increase in demand, the respective countries win over the battle of unemployment.

Probing further, high employment opportunities are the definite advantageous results of globalisation. It has brought in money back home, which has further created multiple job openings. With the ideology of multinational companies, the brands started to set up their factories and offices in developing nations. This ultimately weaved in greater openings for the new talent. Adding on, poverty and unemployment have seen a downward graph due to the expansion of businesses.

Furthermore, one very crucial aspect that has gained importance over the years is the value of talents. With the increased opportunities and wide-open doors of companies and nations across the globe, people are not confined to the laborious and taxing jobs as they were earlier being pushed into during the times of the industrial revolution. In true words, the treatment, respect, and the monetary evaluation for the employment class are three major aspects that have seen a noticeable shift in recent years. Also, because of this, a positive improvement has happened in the employee-employer relationship. This certain change has motivated the workforce of the world and has created employment sectors a better place to grow. Moving ahead, along with the advantages, globalisation also has some disadvantages, which primarily have affected the developed nations.

As discussed above, with the resources and products getting exchanged, the developed countries' companies have access to cheap labor and high-quality products. This works for both the employment sector as well as the manufacturing units. Many companies have even set up their business units to gain direct access to labor and land facilities in developing nations. This, at one point, has proven to be of great benefit for the developing countries, but on the other hand, has taken away the jobs from the developed nations. However, these companies' monetary benefits ultimately add up to the GDP and FDI, and capital flow of the respective countries.

Further, the small companies or the new ventures are always at a risk of failure because of the rigorous competition prevailing in the international market. This puts the products, services, and even the wages of the high skilled workers at risk. These companies further set examples for the failure of budding companies and even discourage new businesses from emerging. The discussion on this point clearly highlights the risk that high competition brings along. Moreover, with the concept of global village into practice, the difficulties have increased even more. The internet generation is putting greater challenges as the order and shipment of goods is now easily accessible. These give buyers a variety of options, resulting in an overdose of competition.

Certainly, loss of jobs in the developed nations, high competition, and free trade are certain factors pointing towards the negative side of the globalisation narrative. Still, the positive effects of globalisation cannot be ignored. It can be said that globalisation is rather a boon than a bane, given the fact that its merits outweigh the demerits. The amount of positivity and growth this process has been providing to the world is unmeasurable. Also, it has made rich nations even richer, which is pushing its government to create even better job opportunities for its citizens. It is because of the higher GDP of the developed nations that their governments can provide federal grants to their national university students. The advancement and the growth in terms of technology and achievement are at par excellence, and developing countries are far beyond their growth chart.

However, to achieve a balance between the both, certain steps need to be taken. These can include motivation for professional courses in foreign countries and pushing children to attain higher educational degrees. Because of the lower aptitude levels and lesser interest in education, they fail to compete with developing countries. The government needs to plan some strategies to fetch the students' interest towards education and generate different kinds of jobs, which would fill the increasing gap of unemployment, largely due to the loss of low-skilled jobs.

Globalisation in totality has both benefits and drawbacks for the developed as well as the developing countries. It has been a concept that has turned fortunes for many, whereas on the other hand, it has also incurred losses to countless people around the globe. There is a need to balance the downsides of globalisation and international trade. Else, the practice of globalisation has certainly proven to be a win-win situation for most countries and much of the global population.

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