What are some of the negative consequences of globalization? Positive and Negative Effects of Globalization

The good and bad aspects of globalization are discussed in this paper. When we talk about it, we’re referring to the process of countries self-integrating as a result of the influence of intergovernmental and non-governmental organizations (INGOs).

As it is linked to the cultural and social features of different nations, it generally entails economic integration and political contact.

What does globalization entail?

Globalization is the expansion of ideas, knowledge, information, goods, and services across the globe. In business, the word is used to define integrated economies that are characterized by free trade, open capital flow among countries, and easy access to foreign resources, especially labor markets, in order to optimize returns and benefit for the common good.

Introduction:

Globalization describes the interdependence of different world cultures, populations, and economies.

It is the result of cross-border trade. The most popular components of such activity include technology, goods, investments, information, and services, as well as the labor market.

Over many centuries, nations have enabled economic, political, and social partnerships, resulting in global integration.People used to travel long distances to settle, trade products, and produce food and raw materials. Trains, steamships, and telegraphs opened the path for global engagement and integration through economic partnership among states in the early nineteenth century.

World Wars I and II, postwar protectionism, and the Great Depression all had an impact on global trade.

Many countries were economically impacted, and there was increasing rivalry among nations. Innovations and improved transportation have improved the same endeavor today. It only takes a few minutes to contact a buyer when selling items internationally.

The United States’ efforts have been linked to the recovery of international trade.

They began popularizing their investment philosophy and preaching the benefits of cross-border trade to the worldwide population. They promoted money to help member states’ domestic economy recover, and they agreed to trade their natural resources. They also enable for the construction of infrastructure to help with transportation.

Globalization’s Impact on Developed Countries

Countries with sophisticated economies were impacted by global integration. Low-cost country sourcing, evolved social connection, and enhanced employment prospects are all good benefits.

What Are Some Globalization Benefits?

Researchers have discovered a number of good consequences of globalization that certain developed countries are currently experiencing. It’s difficult to meet all of them, so let’s concentrate on the most important ones.

Global Industry

This is the most helpful of all the benefits of globalization. It entails encouraging countries to specialize and create a large number of commodities for their own market. Diverse countries generate different things, and the fact that no country is self-sufficient is startling. Some established economies lack sufficient raw materials for their manufacturers, while the remainder incur higher expenses than necessary. Globalization has paved the path for low-cost raw commodities. States can now purchase them and profitably make low-cost goods.

Cross-Cultural Leadership

Each country has its own distinct culture. Culture refers to how individuals conduct themselves as well as their values and beliefs. It is difficult to bring different cultures together to develop a global culture. Some legal systems, for example, do not acknowledge gender equality and do not enable women to lead or operate in business. Many countries did not allow females to obtain education prior to globalization, and even if they did, they were expected to work in fields such as teaching or nursing.

Competition

Competition is a good thing in business. Companies would not be able to pioneer any cross-border trade developments without it. It is the primary factor for improved product and service quality as well as lower prices.

Some industrialized countries’ industries were influenced by competition to find low-cost raw materials and labor to lower prices. People in the first world can afford to acquire products from both home and international firms. As people endeavor to find a competitive advantage for their business, competition encourages more communication of ideas and innovation.Possibility of Employment

The Process of Globalization

Countries specialize in the products and services in which they have a competitive advantage in a worldwide economy. This usually refers to what they can produce and supply more efficiently, with less resources, and at a cheaper cost than competing countries. In theory, if all countries specialize in what they do best, global production will be more efficient, prices will be lower, economic growth will be wider, and all countries will gain.

Internet usage and communication.

The internet has expanded information and knowledge sharing, access to ideas, and cultural interchange amongst people from different countries. It has helped to bridge the digital divide between developed and developing countries.

Technology for communication.

Mobile and wireless networks have become much faster and more responsive since the launch of 4G and 5G technologies.

AI and IoT.

These technologies make cross-border product management more efficient by allowing assets to be tracked in transit and as they move across borders.

Blockchain.

This technology allows for the creation of decentralized databases and storage that help trace commodities across the supply chain. Blockchain enables industries like healthcare and banking to have secure access to data. Blockchain, for example, is a decentralized ledger that records and verifies transactions in a way that avoids fraud and corruption.

Transportation.

People and goods may now move more easily because to advancements in air and fast train technologies. Changes in shipping logistics technology also make it easier to transport raw materials, parts, and finished goods around the world.

Manufacturing.

Manufacturing industry geographic limits have been decreased thanks to technological advancements such as automation and 3D printing. Digital designs may be transferred anywhere and physically created via 3D printing, making distributed, small-scale production closer to the point of consumption easier. Automation improves productivity by speeding up processes and supply chains. It also gives workers more flexibility.

What is the significance of globalization?

Globalization alters how countries, corporations, and individuals interact. It alters the nature of international economic activity by expanding commerce, establishing global supply chains, and facilitating access to natural resources and labor markets.

Changing the way nations conduct commercial and financial exchanges and interactions encourages cultural exchange. Geographic limits, political boundaries, and political economy are no longer impediments.

Globalization’s history

Many people think of globalization as a twentieth-century phenomenon, although it has been going on for millennia. The following are some examples:

Empire of the Romans For decades, the Roman Empire, which dates back to 600 B.C., expanded its economic and political systems throughout most of the ancient world.Silk Road commerce From 130 B.C. until 1453 A.D., these trade routes constituted a new wave of globalization. They transported traders, products, and tourists from China to Europe via Central Asia and the Middle East.

Empire of the Romans

For decades, the Roman Empire, which dates back to 600 B.C., expanded its economic and political systems throughout most of the ancient world.

Silk Road commerce

From 130 B.C. until 1453 A.D., these trade routes constituted a new wave of globalization. They transported traders, products, and tourists from China to Europe via Central Asia and the Middle East.

Before World War One.

In the decades leading up to World War I, European governments made enormous investments abroad. The golden age of globalization is defined as the years 1870 to 1914.

Following World War II.

The United States took the lead in developing a global economic system based on a set of widely agreed international standards. To encourage international cooperation and free commerce, multinational institutions such as the United Nations (UN), the International Monetary Fund (IMF), the World Bank, and the World Trade Organization (WTO) were founded.

What exactly is the G20?

The G20, or Group of Twenty, is a global conference aimed at fostering international collaboration through addressing global economic challenges such as financial stability and climate change. Most of the world’s top economies are represented in the G20, which is made up of 19 countries plus the European Union.

60 percent of the world’s population, 75 percent of global trade, and 80 percent of global GDP are represented by the countries engaged. Following the 1997 financial crisis, it was created in 1999 and has convened annually since then.

Economic, political, and cultural globalization

Globalization can be divided into three categories.

1.Global economic integration.

The focus here is on international financial market integration and financial exchange coordination. Economic globalization is exemplified by free trade agreements such as the North American Free Trade Agreement and the Trans-Pacific Partnership. Multinational corporations (MNCs) play a significant role in economic globalization because they operate in two or more nations.

2. Globalization of politics.

National policies that link countries together politically, economically, and culturally fall under this category. NATO and the United Nations are examples of political globalization organizations.

3.Globalization of culture.

This facet of globalization concentrates on the technological and societal reasons that cause cultures to merge. Increased communication ease, the pervasiveness of social media, and access to faster and better transportation are among them.

Globalization’s Consequences

Globalization’s effects can be felt both locally and worldwide, affecting people’s lives as well as society as a whole in the following ways:

Individuals.

Ordinary individuals are influenced by a range of overseas influences. Globalization has an impact on their capacity to access commodities, pay fair prices, and travel to or even relocate to other nations.

Communities.

The impact of globalization on local or regional organizations, enterprises, and economies is covered at this level. It has an impact on who lives in communities, where they work, and who they work for, as well as their capacity to migrate out of their community and into one in another country. Globalization also affects the development of local cultures inside communities.

Institutions.

Multinational firms, national governments, and other organizations such as colleges and universities are all influenced by their country’s globalization policy and acceptability. Companies’ ability to grow and expand, a university’s ability to diversify and grow its student base, and a government’s ability to pursue specific economic policies are all affected by globalization.

Globalization examples

Globalization is manifested in multinational corporations. The following are some examples:

McDonald’s had 39

According to a filing with the Securities and Exchange Commission at the end of 2020, McDonald’s has 39 198 fast-food restaurants in 119 nations and territories. According to the petition, it employed more than 2.2 million employees at the time.

Ford Motor Company

Estimated working with roughly 1,200 tier 1 suppliers around the world in 2021.Amazon uses tens of thousands of suppliers and employs approximately 1.3 million full- and part-time workers as part of its recent expansion.

Globalization’s Advantages

Globalization allows countries to have access to lower-cost natural resources and labor. As a result, they are able to make lower-cost goods that may be sold around the world. Globalization proponents claim that it benefits the world in a variety of ways, including the following:

Solves financial issues.

Globalization transfers jobs and capital to areas that require them. It provides rich countries with lower-cost resources and labor, while providing jobs and investment dollars to developing countries.

Encourages free trade.

Globalization places pressure on countries to lower tariffs, subsidies, and other trade obstacles. As a result, the economy grows, jobs are created, companies become more competitive, and consumer prices fall.

The delivery

Globalization is a long-running trend that is altering and maybe slowing down. Globalization’s promotion of more open borders and free trade has both positive and harmful impacts.

Individuals, businesses, and countries must evaluate both sides of the globalization issue in today’s post-pandemic world. Learn how businesses are redesigning global supply networks to avoid disruption and maximize globalization’s benefits.

Closing the Wealth Gap between Rich and Poor

The divide between rich and poor individuals has narrowed significantly as a result of globalization. For centuries, there has been a significant divide between these groups, which seemed to expand with each passing year.

Poor people now have access to job opportunities thanks to globalization. People who worked in government sectors and enterprises used to earn a lot of money, but now even overeducated employees make a pittance. As a result, many firms hire talented individuals while underpaying them. Highly paid employees are stressed out due to the costs of preserving a company’s distinctive image, whilst low-income folks appear to be stress-free.

Investments:

Developed-country residents prefer to put their money into lucrative firms rather than bank accounts. The reason for this is that they want to work from home because investing ensures that they will make a profit without exerting any effort.

Unfortunately, such an alternative is only available to people in affluent countries, as the economies of third-world countries are prone to default. People are hesitant to invest their earnings because they have no way of knowing whether their national currency will be equal to the US dollar next year. Others invest it in companies and industries in foreign nations where they can profit.

Modern technology

Globalization has resulted in advanced technologies. The lack of speedy data transfer and public communication created a perpetual demand for innovation. Many inventors have attempted to improve technology in order to meet the needs of modern society. Its advancement has paved the path for good globalization effects in countries that previously refused to collaborate. Such countries choose cooperation partners based on religion rather than economics.

Globalization’s Negative Effects

It has had some negative consequences in wealthy countries. Terrorism, employment insecurity, currency fluctuation, and pricing instability are some of the negative outcomes of globalization.

Legal Consequences

People can learn about what is going on in other countries thanks to globalization. Other countries’ events are covered by media services. As a result, international mediators may be able to resolve numerous conflicts.

Intergovernmental courts arrest and sentence those who commit violations of human rights. Those that engage in illicit activity in order to force competitors out of the market are also prosecuted. Nonetheless, many states are unsatisfied with how an IGO interferes with domestic policy and dictates how they should act within their own borders. Governments that refuse to implement international conventions and follow their laws face economic repercussions.

Terrorism

It is a major concern in most developed countries. As a result of globalization, people travel extensively.Some of them travel to other countries to study, conduct business, visit relatives, work, and seek medical treatment.However, not all of them are really reliable. Many terrorists entered a foreign country with a work visa in order to commit a terrorist act.

People are concerned about the situation since they don’t trust their neighbors.

Unfortunately, terrorists recruit young citizens of the country and persuade them that they are doing the right thing. That is why there is so much fear, mistrust, and tension in society.

Unemployment

Prior to globalization, skilled workers were employed in government and private sectors, where they were paid well. Those who completed college and acquired a degree had job prospects waiting for them. People would resign from one job and immediately apply for another. Many people are looking for work all around the world as a result of globalization. Employers profit from low-cost labor. Because the employer may locate a talented worker willing to work for less money, one can be fired for making a minor mistake.

Price Unpredictability

The impact of globalization on business is price instability. Some people start businesses in countries with cheap raw materials and labor. They are able to reduce production expenses and sell their products at a low cost. Some high-quality products have different prices due to competition. No matter how hard the World Trade Organization tries to keep pricing fluctuations under control, it fails. These businesses use current technologies to communicate with their customers. Successful businesses are those that can find a competitive advantage and, in particular, those that can produce high-quality items at a reasonable cost.

Currency Volatility

The US dollar is used in international trade to buy and sell goods. In developing countries, the price of the dollar swings on a daily basis, resulting in an unbalanced economy and abnormal prices for products and services. IGOs have the greatest impact on national currencies.

What are Globalization’s Beneficial Effects?

Effects on developing countries that are positive

Some emerging countries have benefited greatly from globalization. It is the reason for these countries’ rapid growth and development, as people invest in their infrastructure, technology, and overall production. The following are some of the positive benefits of globalization on emerging countries.

Eradication of Poverty

Developing countries had plenty of resources before globalization, but they didn’t know how to use them. Their populace was illiterate, and there were no roads or transportation options. As foreigners established in these countries, people realized the importance of education and living standards. As a result, locals attended settlers’ schools and gained jobs in their businesses and industries. Some of them went on to further their education in other countries. They were able to improve their families’ living standards by using new information. As a result of globalization, businesses founded by citizens of various developing countries are now important competitors to those from wealthy countries. Although the fight against poverty is far from over, there has been significant progress.

Employment Opportunities

Many educated jobless people exist in most developed countries. They can now work in different nations thanks to globalization. Their main benefit over citizens of industrialized countries is that they provide low-cost services. They’re also eager to learn since they consider themselves fortunate to have started over.

Education

Globalization of education has allowed for more research. The majority of developed countries have excellent educational institutions.

They encourage international students to study there. While it is merely another business enterprise, students from developing nations see it as an opportunity to gain more education and skills to help them advance in their employment. Investors from developed countries settle abroad with their families, and they want their children to attend reputable schools.

They donate to local schools, advance the curriculum, and hire talented instructors as a result. Most developing countries now have advanced high schools and universities as a result of this strategy. There is no need to travel to industrialized countries to obtain education because it is freely available there. Enhanced education is a good thing.

Technology

Technology has been transported to poor countries thanks to globalization. Some foreign investors and foreigners who had struck a deal with people in developing countries needed to contact with them and exchange ideas and information.

The most efficient method was to use current technologies. It has been extremely beneficial to individuals in poor countries. The majority of them can buy and sell low-cost items online. They collaborate with enterprises in wealthy countries via the internet.

Interaction with individuals via social media, the Internet, and other platforms has opened up new avenues for improving living standards. Many volunteers from rich countries have responded to media publicity. As a result, most people can meet their basic needs for food, clothing, and medicines.

International Investments

People from affluent countries were forced to invest in underdeveloped countries as a result of globalization. Foreign investment is one of the outcomes of globalization, which has resulted in numerous changes in these countries. Some investors, for example, desire raw materials and items to be delivered to industry and market more quickly.

The only way to accomplish this is to assist each government in developing effective infrastructure. Locals are employed by the industries and businesses that have established themselves in their country. By paying taxes to the government, investors help the country’s economy. They assist government agencies in improving institutions such as schools and hospitals, which benefits the residents and their families.

Globalization’s Negative Effects

Although globalization has benefited developing countries in many ways, it has also had some negative consequences.

Workers’ Displacement

Globalization has created opportunities for work all across the world. Most people, however, have had to abandon their family for long periods of time in order to work abroad. As a result, many families have divorced, remarried, and abandoned their children to volunteers and shelters. Because the money they make from their job is insufficient, some children have been unable to support their elderly parents’ requirements. Many elderly people die as a result of illness and a lack of financial and emotional assistance from their children.

Unemployment

Until globalization took hold, about half of the working population in practically all developing countries relied on informal jobs in sectors. Technology has diminished such jobs while increasing the global demand for trained individuals. The majority of people in developing countries lack skills, and the employment that are accessible pay badly due to increased demand brought on by globalization. Because most individuals are unemployed and unable to meet their basic requirements, criminal behaviors such as burglary, pickpocketing, murder, and drug usage have escalated. As the wealth gap between affluent and poor increases, unemployment and poverty rates continue to rise.

Increased prevalence of lifestyle diseases

Globalization has ushered in the consumption of processed foods and the use of chemicals to shorten the growth cycle and maximize profit. Animals such as cows are fed chemicals that cause them to produce a lot of milk or gain weight for those sold for the meat industry in order to benefit from business. Chronic diseases are on the rise as a result of increased chemical consumption from meals. The death rate is really high. Furthermore, in underdeveloped countries, life expectancy is decreasing.

Culture Abandonment

Every group, civilization, or nation has its own set of values and beliefs, or culture. They are necessary because they shape what is considered acceptable behavior in a certain group. The elders or leaders guarantee that the people follow the rules of morality. Globalization, on the other hand, intermingled cultures. People began to reevaluate their original norms and rituals, considering their culture to be primitive.

Some developing-country states have adopted Western culture and abandoned their own. Because they are seen as backward and primitive by international society, community leaders can no longer follow their own domestic policy of punishing citizens for crimes as they used to. Because of this, they adopt a society that is weird and alien to their nature.

Terrorism

Not a year goes by in my neighborhood without some form of terrorism, which has harmed the community’s well-being and cohesiveness that existed before to globalization. According to current statistics, nine thousand terrorist acts have place over the world in 2017. This figure appears to be quite terrifying. My hometown, unfortunately, is not an exception. Our large city mall caught fire last year. The police claimed that the fire was started intentionally.

What impact does globalization have on me?

Globalization has a lot of advantages for me. To begin, I have a college diploma and work as an internet writer. To put it another way, I work as a freelancer. I buy a lot of my gear and tools online, and I can contact with individuals from all over the world through social media. On the other hand, thanks to globalization, I have never been able to find work in an office. Because of the high level of competition, all of my applications have been rejected.

Globalization makes corporate management simpler and more efficient.

Globalization, according to my research, makes global corporate administration easier. This is due to advancements in technology, transportation, communication, education, and trade legislation that make commerce more equitable for all parties. This encourages more people to participate in international commerce and trade.

Due to the high level of rivalry in the market, global managers confront numerous obstacles. Good judgments must be made in order to satisfy and retain customers as well as attract new customers for their products. Companies benefit from economies of scale in their operations due to lower managerial costs.

Globalization’s effects on business management developed countries

Globalization has benefited industrialized countries while also having negative consequences. Education, trade, technology, competition, investments and capital flows, employment, culture, and organizational structure are among the positive consequences.

Positive results

It would be difficult to discuss the degree of globalization’s good effects on the world at large. Nonetheless, below are some of the good benefits of globalization and the positive influence they have had on a wide range of demographic groups.

The world market.

The privatization of state-owned enterprises has resulted in the most successful emerging markets in industrialized countries. Many of these industries are attempting to grow and extend their value chain to an international level in order to enhance consumer demand. The dramatic growth in the quantity of cross-border transactions demonstrates the impact of globalization on business management. Businesses are continuing to expand their footprint to safeguard yields and retain competitiveness, since it lowers costs and benefits from economies of scale. (Shah A.,2009)

Management across cultures

Because they are the only people affluent enough to buy many of the things accessible in the global marketplace in many regions of the world, globalization tends to be the domain of the elite. In a westernized environment, highly educated and rich people from many backgrounds mingle. Because Western fashions are emblems of prosperity and power, the privileged frequently adopt western-style products and patterns of conduct to impress others. International commerce nowadays is dominated by Western culture, behavioural patterns, and language (Asgary N. and Walle A.H.,2002).

International trade

Globalization has facilitated and extended international trade. Things that were previously solely available in developed countries are now available in countries all around the world. People can now have anything they desire from any country. Developed countries can use this to export their goods to other countries. Countries conduct commerce through international trade, importing and exporting items all over the world. Exporting countries benefit from competitive advantages.

International investment

The flow of foreign cash is one of the most evident positive outcomes of globalization in India.Many corporations have made direct investments in India by establishing manufacturing facilities there, but we also need to look at the amount of foreign investment that flows into emerging countries.Indian enterprises that have been operating well both in India and abroad would attract a lot of foreign investment, which will boost up India’s foreign exchange reserve.One of the beneficial outcomes of globalization in the United States and other rich countries is that emerging countries provide them with a fantastic investment opportunity.

Competition

Global competition has enhanced product quality, which is one of the most evident beneficial benefits of globalization. Customer service and “customer is king” production practices have increased product and service quality. Domestic businesses must enhance their standards and levels of customer satisfaction to compete with foreign firms. Furthermore, when a global brand enters a new country, it does so with a certain amount of goodwill that it must maintain. This results in market rivalry and a condition where the fittest survive.

Culture

The cultural benefits of globalization are numerous! Not every beneficial behavior originated in a single civilisation.The world we live in today is the product of the fusion of different cultures.If receptive, people of one culture tend to notice weaknesses in their own culture and adopt the culture that is more accurate or in sync with the times.Societies have grown in size as they have welcomed people from diverse civilizations and backgrounds and developed their own culture.

Legal Consequences

Increased media exposure attracts the world’s attention to human rights violations. As a result, human rights are improved.

Global economic expansion does not always make people happy, and global free trade should help humanity as well as safeguard the environment, rather than only benefiting managers and stockholders.

Those who want to be true leaders must address disparities. Globalization should foster better democracy and wealth by encouraging openness and information exchange.

HARMFUL EFFECTS

Globalization has negative consequences for industrialized countries. Jobs insecurity, price fluctuations, terrorism, currency fluctuations, capital flows, and other issues are among them.

JOBS WITHOUT SECURITY.

People in wealthy countries face employment insecurity. People are being laid off. Manufacturing and white-collar jobs have been outsourced by developed countries.

This means fewer jobs for their citizens. This is due to the fact that manufacturing jobs are outsourced to countries with lower manufacturing prices and wages than their own.

They’ve delegated work to developing nations like China and India. Outsourcing to cheaper locations like India has cost most people their employment, including accountants, programmers, editors, and scientists.

PRICING FLUCTUATION.

Price fluctuation is a result of globalization. Developed countries are being compelled to cut their pricing for their products as a result of increased competition.

This is because other countries, such as China, create items at a lower cost, making goods cheaper than those produced in developed countries.

As a result, industrialized countries are driven to lower their rates in order to retain their clients. This is a disadvantage to them because it decreases their country’s ability to maintain social welfare.

Unemployment

Globalization is to blame for the world’s unemployment crisis, despite the fact that it has created some work opportunities. Despite the fact that it provided global job prospects, it is nonetheless to blame for the current scenario. “It’s true that global economic integration and more travel have improved national and firm competition, prompting producers to find ways to decrease costs, improve efficiency, and raise productivity.”

Fast food chain expansion.

The fast food industry is rapidly expanding. However, some of the most rapid expansion is taking place in developing countries, where it is affecting people’s eating habits.

The largest, fastest-growing, and most promising franchise is Kentucky Fried Chicken (KFC).

Western civilization.

In emerging countries like Africa, globalization has resulted in the spread of western culture and influence at the detriment of native culture.

The majority of individuals in poor countries today copy what wealthy countries do. As a result, it appears that they are ignoring their own culture in favor of Western society ( Goyal K.A., 2006).

For instance, clothing trends and eating habits, as well as language. All of these factors can have an impact on management in one way or another, for example, language barriers might lead to misconceptions.

Trade

Many developing nations, even ones that have recently undergone trade reforms, nonetheless have high average tariff rates.

Example,India. At least in some of the lower-income developing countries, trade policy remains an important part of globalization.

POSITIVE RESULT.

“I recognize that globalization has had many bad consequences, but I feel it is always preferable to look forward with optimism and hope.” Hopefully, tomorrow, we will be able to reduce or even eliminate the negative forces that plague globalization. As a result, we shall be able to progress in peace and harmony” (Kulkami A., 2009)

Poverty reduction

In terms of poverty reduction, globalization plays a role in emerging countries. In fact, most affluent countries, especially fast-developing countries like China, India, and Vietnam, saw a decrease in the proportion of their population living in poverty. Other countries, such as Sub-Saharan Africa, saw the reverse trend (Lee E., 2006).

Situation regarding employment.

People from many countries are given job chances in the global economy as a result of globalization. It is responsible for the concept of outsourcing.

Developed countries desire to send their workers to low-cost developing countries. Customer service, software development, accountancy, marketing, and insurance are all tasks that are delegated to developing countries like India.

As a result, the country that is provided the work benefits from the employment.

Technology

This is a powerful force that is bringing the world closer together. Communication, transportation, and travel have all become proletarianized.

People from all walks of life want to know everything they’ve heard, seen, or experienced through technology. Organizations can get information from many parts of the world that can be employed in the organization through their management.

Education.

From an economic standpoint, globalization has both beneficial and negative consequences.

It has extended access to higher education, such as universities, and has helped to close the knowledge gap in developing nations, but it also has drawbacks that endanger universities in such countries.

From a development standpoint, it has benefited underdeveloped countries by providing access to higher education institutions.

You can now travel freely over the world, especially poor countries, in search of the best educational institutions.

International trade

Globalization, despite its negative repercussions, has a positive side. Trade is one of the most significant effects it has had on emerging countries.

People used to trade products for goods or services for services, but now they may swap goods for cash. This is primarily accomplished through international trade, which involves people exporting and importing commodities between countries.

Globalization has resulted in lower trading costs around the world. It has resulted in a reduction in the importation tax.

International investment

Globalization has a direct impact on foreign investment. Foreign investment is always welcome since it brings resources, capital, and technology to a country, all of which help the host country flourish economically.

This helps to increase employment both directly and indirectly. Increases a country’s exports, which improves the current account and thus aids in the repayment of foreign debt.

However, this has been criticized as leading to excessive foreign control.

Market segment

Market globalization in emerging countries is accelerating. On a previously unimagined scale, the creation of worldwide markets for standardized consumer products. This resulted in manufacturing cost savings, lower global prices, and improved distribution, marketing, and management (Levitt T., 1983)

12 Consequences of Globalization

Economists appear to regard Globalization as an unqualified “positive.” Unfortunately, economists appear to be directed by their severely defective models, which cause them to overlook real-world issues. They particularly overlook the fact that the universe is finite.

We don’t have infinite resources or an infinite capacity to deal with pollution. So we’re putting in place a “solution” that is just transitory at best.

1. Globalization accelerates the depletion of finite resources.

In December 2001, China, for example, became a member of the World Trade Organization. Its coal consumption began quickly increasing around 2002. (Figure 1, below).In fact, global coal usage has increased dramatically (Figure 2, below). India’s consumption is also rising, although at a slower pace.

2. Globalization raises carbon dioxide emissions worldwide.

Carbon dioxide emissions will rise if the world burns coal more quickly and does not reduce its usage of other fossil fuels. Figure 3 depicts how carbon dioxide emissions have risen in comparison to what would have been expected in the years leading up to the 1997 adoption of the Kyoto Protocol.

3. Because of globalization

It is nearly hard for regulators in one country to anticipate the global consequences of their decisions.

Actions that appear to cut emissions for a single country may actually boost global commerce, expand industry in coal-producing areas, and increase overall emissions. See my piece Climate Change: Why Traditional Solutions Fail.

4.Globalization causes global oil prices to rise.

Oil price increases have occurred twice over the world. The first happened between 1973 and 1983, after US oil supplies began to drop around 1970. (Figure 4, above and Figure 5 below).

Oil production and price in the world

5. Globalization shifts the burden of finite oil supply use from developed to poor countries.

If global oil production does not increase significantly but demand in developing countries rises rapidly, oil must be found someplace to meet this rising need. This shift is made possible by the mechanism of rising oil prices.

6. Globalization shifts employment from developed to developing countries.

Globalization creates a fair playing field, making it difficult for developed countries to compete.

A country with a lower cost structure (lower wages and benefits for workers, more affordable coal in its energy mix, and more lenient pollution controls) can compete more effectively than a typical OECD economy.

Around the time China entered the World Trade Organization in 2001, the percentage of US citizens with jobs began to decline..

7. Globalization shifts investment expenditures from developed to developing countries.

Which country will an investor choose if given the option to choose between one with a competitive advantage and one with a competitive disadvantage? A change in investment should not come as a surprise.

Domestic investment in the United States remained relatively stable as a percentage of national income until the mid-1980s (Figure 9). It has decreased in recent years and is currently near to asset consumption (similar to depreciation, but includes other removal from service).

All forms of capital assets are under doubt, including government-owned assets (schools, roads), business-owned assets (factories, retail), and private residences. When looking at corporate investment independently, a similar pattern emerges.

8. With the dollar as the world’s reserve currency, globalization causes massive trade deficits and other imbalances in the United States.

Since 2002, the US trade imbalance has exploded due to greater globalization and rising energy prices (Figure 10). When the figures from Figure 10 are added together, the total US deficit from 1980 to 2011 is $8.6 trillion. The total deficit since 1980 is likely to be around $9 trillion by the end of 2012.

9. Globalization has a tendency to shift taxation away from corporations and toward individuals.

Corporations have the flexibility to relocate to areas with the lowest tax rates. Individual citizens have far less power to effect change. Furthermore, given the current labor shortage, each city competes with one another for the number of tax advantages it can provide prospective firms.

10. Globalization creates a currency “race to the bottom,” in which countries compete for an export advantage by depreciating their currencies.

Because of the global economy’s competitive nature, each country must sell its goods and services at the lowest possible price. This can be accomplished in a variety of ways, including paying lower wages to employees, allowing more pollution, using cheaper, more polluting fuels, or debasing the currency through Quantitative Easing (also known as “printing money”) in the hopes of inducing inflation and lowering the currency’s relative value to other currencies.

11. Dependence on other countries for crucial commodities and services is encouraged by globalization.

Goods can often be obtained for less money elsewhere thanks to globalization. A country may start to conclude that generating its own food or clothing is pointless. It’s simple to become reliant on imports and specialize in non-oil-dependent industries like financial services or high-priced medical care.

12. Because globalization binds countries together, if one falls, it is likely to spread across the system, affecting many more countries.

There are several examples throughout history of civilizations that began tiny, expanded to over-utilize their resource base, and finally fell. We are currently in a world position that is not all that dissimilar.

The United States is not the only country in financial trouble. Many European countries, as well as Japan, are incomparable bad shape. The fall of one country has the potential to bring several others, and much of the system, down with it. The only countries that are secure are those that have not become overly reliant on globalization–which is unlikely to be many today–perhaps African landlocked countries.

F.A.Q: What are some of the negative consequences of globalization?

Conclusion:

Globalization, in short, points to the whole effort towards making the world global community as a one village. Goods that were only found in western countries can now be found across the globe.

Now underdeveloped areas can enjoy the benefits of scientific advances and industrial progress available in developed countries for the improvement and growth of their areas.

Because of globalization, the economies of the world are being increasingly integrated, example mobile phones and the internet have brought people closer. The world is becoming a smaller place.

Work can be outsourced to any part of the world that has an internet connection because of improvements in traffic infrastructure one is able to reach one’s destination in a short time.