You should spend about 40 minutes on this task.
Even though Globalization affects the world’s economics in a very positive way, its negative sides should not be forgotten. Discuss.
Write at least 250 words.
Globalization is the phenomenon as we perceive it could be defined best as the growing mobility of capital through the transfer of goods and services as well as the greater stream of information across national frontiers owing to unprecedented development in technology and the market economy. The phenomenon has brought forth a global shift, that is, a world being transformed into a shared political and economic arena. Although world’s economy seems to thrive on it, its negative impacts is enormous that must be considered.
For a start, as the barriers to trade and commerce has been removed, global markets have emerged for myriad goods and, increasingly, services. Apart from that, globalization causes a cut-throat competition, which in turn helps consumers get the commodities and services in a relatively cheap price. In addition, the spread of information and ideas promotes awareness of human rights norms and democracy. As a result, the overall living standard has improved with the rise of globalization. Most importantly, human experience is enriched by the sharing of customs, cultures, foods, and so forth.
However, globalization is an ideological construct employed to trumpet capitalist victory ¬¬– to hide the crisis-ridden nature of the system, and its inherent failure to meet the needs of marginal population. Capitalists seek to gain competitive advantage over one another by the natural procedure of capitalist accumulation that of maximizing profit and minimizing cost. Developed nations tend to profit from globalization in several ways when negotiating with developing countries. Multinational enterprises that go developing countries for instance, gain from cheaper land and tax rate, cheaper labour force, cheaper raw materials, and so forth. In the end however, many a multinational enterprises end up negatively affecting the host nation’s economy by taking all profit back home, politically by paying bribes to the government officials for reducing tax rates or other tariffs, and finally also socially, by polluting environment.
Summing all of the above, many negative impacts could be stemmed from globalizations. It has enabled trade and commerce to grow, capital and information flows to increase, but has failed to establish a better allocation of resources to be met across the globe. We, therefore, have to mull over the opportunities globalization offers before making any policy in favour of it.
Capital, Capitalist accumulation, Competitive advantage, Market economy.