Scribd
Upload
19 views9 pages

Economy & Globalization-WPS Office

Uploaded by

Majesty Tee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
19 views9 pages

Economy & Globalization-WPS Office

Uploaded by

Majesty Tee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 9

DELTA STATE UNIVERSITY, ABRAKA.

FACULTY OF ARTS
DEPARTMENT OF THEATRE ART

COURSE CODE: THA 813


TITLE: MULTIMEDIA AND GLOBALIZATION

THE ECONOMIC ADVANTAGES & DISADVANTAGES OF


GLOBALIZATION
By

TEMITOPE IREH
PG/20/21/270156

OCTOBER, 2021.
INTRODUCTION

Economically, globalization is the "web of relationship between


economies worldwide, by way of International trade and
investment" (MasterClass, 2020). Where economy collectively
focuses on money, currency and trade, and the efficient use of
the resources.
Before globalization became a phenomenon, commerce and
business have been limited by geographic constraints, fast-
forward to present day, it's believed that increased
globalization will lead to massive economic growth for nations -
and for this global economy - these nations will be willing to put
their differences aside and work towards economic growth.
We can agree that globalization is leading to increase in the
standard of living around the world, especially developing
countries, who now have access to global market, can now
export their local produce.
However, the general complaint critics have about
globalization, economically, is that " it has made the rich richer
and the non-rich poorer" (Forbes). Globalization is said to be
eliminating free trade, however, there are still many barriers.
According to Mike Collins, in 2015, 161 countries had Value
Added Tax (VAT) on import while some countries had non at all
(Forbes).
So, we can also agree that the effects of globalization are not
positive for all nations.

A HISTORICAL VIEW
Globalization is a new phenomenon, since the start of
civilization, people have traded in goods and services with their
neighbors. As cultures advanced, they were able to travel
farther to trade their own goods for desirable products found
elsewhere. The Silk Road, an ancient network of trade routes
used between Europe, North Africa, East Africa, Central Asia,
South Asia, and the Far East, is one of such early example of
what globalization is about. For more than 1,500 years,
Europeans traded glass and manufactured goods for Chinese
silk and spices, which contributed to the global economy in
which both Europe and Asia became accustomed to goods from
far away. Following the European exploration of the New
World, the widespread transfer of plants, animals, foods,
cultures and ideas became known as the Columbian Exchange
reveals how globalization occurred on a grand scale. The
Triangular Trade network in which ships carried manufactured
goods from Europe to Africa, enslaved Africans to the Americas,
and sent raw materials back to Europe is another example of
globalization. Sadly, the spread of slavery demonstrates that
globalization can hurt people just as easily as it can connect
people.
The rate and effect of globalization has increased in recent
years, a result of rapid advancements in information technology
; communication and transportation. Advances in
communication enable businesses to identify opportunities for
investment Also, innovations in information technology enable
immediate communication and the rapid transfer of financial
assets across borders. Improved fiscal policies within countries
and international trade agreements between them also
facilitate globalization. Political and economic stability facilitate
globalization as well. The relative instability of many African
nations is cited by experts as one of the reasons why Africa has
not benefited from globalization as much as countries in Asia
and Latin America (MasterClass).

ECONOMIC ADVANTAGES OF GLOBALIZATION


•COMPETITIVE EDGE
(a) Globalization provides businesses with a competitive
advantage by allowing them to source raw materials
where they are inexpensive.
(b) Globalization also gives organizations the opportunity
to take advantage of lower labor costs in developing
countries, while leveraging the technical expertise and
experience of more developed economies.
•JOINT PRODUCTION & INDUSTRIALIZATION
(a) With globalization, different parts of a product may be
made in different regions of the world.
(b) Globalization has long been used by the automotive
industry, for instance, where different parts of a car may
be manufactured in different countries. Businesses in
several different countries may be involved in producing
even seemingly simple products such as cotton T-shirts.

•EMPLOYMENT OPPORTUNITIES
(a) Globalization has enhanced firms' abilities to relocate
their production processes and give their franchise to
another country, without obstruction or barrier.
(b) Organization rapidly scale up and reduce overhead
costs by outsourcing processes to nations with cheaper
labour costs. This free flow of labour increases the total
number of global jobs.
Examples ;
o Many businesses located in the United States have
outsourced their call centers or information technology
services to companies in India.
o As part of the North American Free Trade Agreement
(NAFTA), U.S. automobile companies relocated their
operations to Mexico, where labor costs are lower. The
result is more jobs in countries where jobs are needed,
which can have a positive effect on the national economy
and result in a higher standard of living.
o China is a prime example of a country that has benefited
immensely from globalization, especially exportation of
their manufactured products.
o Another example is Vietnam, where globalization has
contributed to an increase in the prices for rice, lifting
many poor rice farmers out of poverty. As the standard of
living increased, more children of poor families left work
and attended school.
CONSUMERS BENEFIT
(a) Globalization decreases the cost of manufacturing. This
means that companies can offer goods at a lower price to
consumers. The average cost of goods is a key aspect that
contributes to increases in the standard of living.
(b) Consumers also have access to a wider variety of
goods. In some cases, this will contribute to improved
health by enabling a more varied and healthier diet and
range of products.

ECONOMIC DISADVANTAGE OF GLOBALIZATION


• Unequal Economic Growth
a) When many countries' economic system becomes
interdependent, the likelihood of a global recession will
increase drastically, reason being, if one country's
economy struggles, it will cause a chain reaction that
would affect the other countries, causing a worldwide
crises financially, and developing will suffer more.
b) Also, large multinational corporation have the loophole to
escape tax payment while exploiting the benefits that tax
payers (domestic establishment) are entitled to.
c) Meanwhile, workers in developed countries, e.g United
States, face pay cut demands from employers, on the
other hand, workers in developing countries, e.g Nigeria,
are immigrating to developed countries where they have
more value (payment/better working conditions), an
instance is this Nigerian doctors moving to Saudi Arabia
saga. Aside creating a gap in the labour market, these
trends creates fear for middle class employee and
employers who have little leverage in the global game.

Increased Competition
The pool for business competitiveness has widened.
a) As a result , some government design policies to make
doing business in their country, as a competing nation,
difficult, justifiably. Thess policies takes the form of tariffs,
quotas, or non-tariff barriers e.g quality or sanitation
requirements. Consequently, these actions are often
harmful to the economy of such nations, including the
country which made those barricading policies.
b) With the competition comes human resources poaching
or relocation, which leads to immigration. Economically,
immigration increases the Gross Domestic Product (GDP),
which can lead to economic growth for the recipient
country, and the opposite for the immigrants' own
country. However, the GDP per Capita is likely to reduce in
a short while, especially if the immigrants' income is lower
than that of the average income of those already living in
the country, and it's mostly not possible, hence, the
eventual drop in GDP is inevitable.
CONCLUSION
Globalization, as it seems, is here to stay, what can be done
now is for government, business owners, employers and
employees, and economical stakeholders, to identify and be
willing to confront and prepare for the risks and challenge
globalization brings, and understand how to curb, reduce
effect, and benefit from them.

Works Cited and Works Consulted


MasterClass.com/business/how-globalization-works:pros-
and-cons-of-globalization/November/8/2020.
Retrieved 28/10/2021.
Forbes.com/MikeCollins/2015/05/06/The-pros-and-cons-
of-globalization. Retrieved 28/10/2021
https://online.hbs.edu/course-GlobalBusiness/pros-and-
cons-of-globalization. HarvardBusinessSchool.
Retrieved 28/10/2021.

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy