UNDERSTANDING GLOBALIZATION & ITS IMPACT

Ananya Singh (01)

WHAT IS GLOBALISATION
G

L
O • “The increased interconnectedness and interdependence of peoples and countries. It
is generally understood to include two inter-related elements: the opening of
B international borders to increasingly fast flows of goods, services, finance, people
A and ideas; and the changes in institutions and policies at national and international
L levels that facilitate or promote such flows.”. - WHO
I
Z • Example Assume that you are a mango farmer and you grow very good quality
A mangoes . Obviously , your fruit is highly appreciated in India, but you also know
T that you shall get a better value in US. So the network of communication and
I execution that allows you to sell your fruit in US is basically, the phenomenon of
globalization.
O

N
 • The wake of globalization was first felt in the 1990s in India when the
then finance minister, Dr Manmohan Singh initiated the economic
liberalization plan. Since then, India has gradually become one of the
economic giants in the world. Today, it has become one of the fastest
growing economies in the world with an average growth rate of around
History of 6-7 %. There has also been a significant rise in the per capita income and
globalisation the standard of living. Poverty has also reduced by around 10 %.

The service industry has a share of around 54% of the annual Gross
Domestic Product while the industrial and agricultural sectors share
around 29% and 17% respectively. Due to the process of globalization,
the exports have also improved significantly.

Globalization has really out a positive impact on today's economy and it

is expected to develop in the years to come.
 View Points
Hyper-globalist Sceptics Transformationalist

They insist that globalization Here they are skeptical about the idea They believe modern processes of
is occurring now and local of global economic integration being globalization are historically
cultures are being eradicated anything particularly new. irrelevant as the government and
due to the increase of They believe that globalization is people across the world believe that
international capitalism. exaggerated and as they look back there is an absence of clear
to the nineteenth century, they’re able distinctions between the global and
They believe that globalization to draw higher statistical evidence of the local. 
is a positive action. developed flows of trade and
investment which they compared to Transformationalists have made no
it is characterized by economic today’s modern society. claims as to the future of
uplift, high prosperity and the The Sceptics insist that their analysis globalization, nor do they vision
spread of democracy.  of the nineteenth century demonstrate our current globalization as a version
that instead of witnessing of a ‘globalized’  nineteenth century.
globalization, the world is going
through ‘regionalization’; to organize
a country on a regional basis.
 Elements of Globalization Economic
Globalization
Political
Globalization
Cultural
Globalization

Economic Globalization

• It
is characterized by the emergence of increased global flows of international trade
and investment. Its main agents are companies, investors, Bank ,Financial
Institutions, private-sector industries, nation-states and international institutions.
• Economic globalisation has led to the growth and development of international
business through the creation of globalised business corporations. These business
corporations are known by various names such as multinational enterprise MNE,
multinational corporations MNC and the transnational corporation TNC and are the
phases of international business. The simplest description of TNC is that it is a
business enterprise which has business activities beyond its national boundaries to
the ownership or control of production or service facilities.
 Elements of Globalization Economic
Globalization
Political
Globalization
Cultural
Globalization

Cultural Globalization
• Cultural globalisation is a process of cultural homogeneity or having similar taste all
over the global economy. The globalisation of culture visual in the form of a common
preference for things such as McDonalds burger, Nike shoes, iPods and blackberries, is
symbol of global similarity of taste.
• The phenomenon of cultural globalization consists of issues of cultural homogenization
verses cultural hybridization.
• Cultural homogenization is the outcome of the impact of ideas and images that are able
to travel globally due to the development in the tele-communication and the internet.
• Cultural hybridization is the adaptation of global products and ideas according to the
local tastes and preferences. Cultural Globalisation is localisation of the global
 Elements of Globalization Economic
Globalization
Political
Globalization
Cultural
Globalization

Political Globalization

• Political globalisation refers to the process of changes in the rules and

structure of global governance. The global economy has seen several
changes in political structure and ideology after the end of the 2nd world
war.
• These includes the Rise and fall of socialism, the emergence of global and
religious Institutions of governance such as International Monetary Fund,
World Bank and the World Trade Organisation.
 Drivers of Globalization

 Economic Forces

• Economic System
 Technological Forces
• Economic Liberalization
in Developing nations
• Globalization of Supply • Discovery of the Microchip  Political Forces
Chains
• Developments in
• Globalization of Demand transportation
• Emergence of Regional • Emergence of global
Trading Blocs governance
 • The Global Value Chain and dispersal of production

• Creation of a global Marketplace

• Globalisation and natural structure

Globalization

• Adverse impact on jobs and income in developed countries

Impact of

• Loss of natural Sovereignty

• Exploitative work practices

• Environmental degradation
Advantages of globalization
• Increased free trade between nations
• Increased liquidity of capital allowing investors in developed nations
to invest in developing nations
• Corporations have greater flexibility to operate across borders
• Global mass media ties the world together
• Increased flow of communications allows vital information to be
shared between individuals and corporations around the world
• Greater ease and speed of transportation for goods and people
• Reduction of likelihood of war between developed nations
• Increases in environmental protection in developed nations.
Disadvantages of globalization
• Increased flow of skilled and non-skilled jobs from developed to
developing nations as corporations seek out the cheapest labor.
• Increased likelihood of economic disruptions in one nation effecting
all nations.
• Corporate influence of nation-states far exceeds that of civil society
organizations and average individuals.
• Threat that control of world media by a handful of corporations will
limit cultural expression.
• Greater chance of reactions for globalization being violent in an
attempt to preserve cultural heritage.
• Greater risk of diseases being transported unintentionally between
nations.
Thank you