Answer 1- Globalization is the integration of the national/domestic
economy with the world economy which has made the world a global village, it
has led to the creation of a worldwide system, thereby enabling free movements
of goods, capital and information, virtually sweeping away the politician
boundaries ‘no distance is now big enough and no country or nation really
It points to the whole effort towards making the world a global community
because of the increasing integration of economies and advancements in
information and communication . technology, benefits of technology advances to
developing nations, making the world a smaller place. People can move from one
country to another, trade restrictions are reducing, domestic markets are open
up for foreign investments, telecommunication are better established.
Globalization has affected the
whole world in both positive as well as negative manner .
EFFECTS ON WESTERN/DEVELOPED COUNTRIES
Globalization has brought benefits in developed countries as well as negative
effects, but the positive effects have been usually successful is out shadowing
the substantial negative effects.
On the positive side, it has created a global market- brought up the
concept of MNC’s , encouraged FDI flows, increasing cross border transaction,
encouraged foreign trade in the world, there by classifying the need of
worldwide in a better way by providing them with more options to choose from ,
enabled resource sharing thus lead to better optimum utilization of resource, increased
level of competition there by leading to improvement in the of domestic goods
and services, raised standard and many more,
But globalization has its negative effects .
Loss of jobs – developed nations have been outsourcing manufacturing and
other jobs to developing and poor nations where they can be performed at a
lower cost, with cheaper resources , leading to the loss of jobs, for a lot of
people, insecurity among people in the west.
Fluctuation in prices – due to increased competition, availability of
lot of substitutes, western countries are forced to lower the prices of their
Terrorism – Due to barrier force trade and movement of goods, capital
and people across borders, some unwanted elements also cross borders and create
ruckus in the western countries, sometimes the scale of these unwanted and unwelcomed
activities is quite high to give shape to terrorism.
in currency – when
countries enter into trade dealings with each other, they exchange currencies
for transaction to take place, so when one country changes the value of its
currency deliberately or because of market forces, the other countries trading
with it are affected and there they have to change the value of their
currencies in response.
After a brief number of years in which globalization made everything seemingly
cheaper, the term of trade moved badly against the west.
Though, the world as whole is getting richer and the size of economy has
increased considerably, but the benefits have occurred to the developing
nations at the expense of developing western world and the wealth divide bar widened
to record levels almost everywhere.
western world adopted, were owned and promoted globalization because it opens
up new markets, introduces new ideas, leads to more, productive activities,
reducing the cost and increasing the profits, but they failed to realize its
negative impact on them , that leads to a loss of jobs for their people, they
will be priced out of the market.
Globalization, though were supposed to work, uniformly and for equitable
development for the entire world but because of the western nations giving up
on a lot of activities and relying too much on the concept of outsourcing and
production in developing and emerging economies and making use of their
resource, thus it played against them in the above mentioned ways.
System would work properly only if everyone has played by economies set of
rules and standards, that’s what went wrong with globalization.
History of globalization- link
Globalization, as a means of increased integration through trade and investment
is an important reason for reduction of poverty and global inequality. over
yes globalization has helped some poor nations to become emerging countries by
living them win the developed nations or developed parts of the world.
Globalization has improved employment situation in developing countries, it
created the concept of outsourcing. Developed countries prefer to provide work
to developing countries where cost of services is cheap.
Work/task such as customer service report, software development, accounting,
and insurance are given to developing countries like India, therefore the
country that is allotted the work enjoys by getting jobs.
It has created investment opportunities in the emerging economies by tapping
the hidden potential resources, talent, the lack of capital in developing
countries is there satisfied by these investment and hence increased
opportunities due to global nature of business.
Advancement in technology-
technology has facilitated the communication, transportation hence contract between people worldwide. this
advancement increased the access of people from the emerging nations to get in
touch and experience new things developed worldwide and to use them at
facilitates the work and knowledge transfer also take place through
access to education –
educational institution has increased for emerging nations because of
globalization, has helped in reducing knowledge gap in developing nations.
Since physical movement from one country to another is expensive many people
are excluded from, gaining the opportunity of education, technology has made in
possible to import and gain knowledge sitting in one own’s country through
Participation trade/Imposed trade
balance- Globalization has enhanced the participation of
developing nation in trade by providing them the means and subsidiary them,
most developing countries were net importers, but today, because of reduced
cost of manufacturing and trading and ownership and subsidiary resource base, emerging
nations are becoming manufacturing hubs for net exporters.
Improved living standard –
Greater access to developed nations.
marks and access to education and technology has raised the living standard of
people in developing nations.