What is Globalization?

Your shoes were made in Vietnam and your iPod in China. Your Play Station comes from Japan. You can travel to Moscow and eat a Big Mac there and you can watch an American film in Rome. Today goods are made and sold all over the world, thanks to globalization.

Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world.

Another definition of Globalization simply states that it is the coming together of the world's markets for goods, services, capital and labour. It can be described as a more intense and worldwide version of regional integration as a result of changes in communication, transportation and technology. International companies called "Multinational Corporations" (MNCs) manufacture products in many countries and sell to consumers around the world. Money, technology and raw materials move ever more swiftly across national borders. Along with products and finances, ideas and cultures circulate more freely. As a result, laws, economies, and social movements are forming at the international level.

Positive Effects of Globalization:

  • Resources of different countries are used for producing goods and services they are able to do most efficiently.
  • Consumers to get much wider variety of products to choose from.
  • Consumers get the product they want at more competitive prices.
  • Companies are able to procure input goods and services required at most competitive prices.
  • Companies get get access to much wider markets
  • It promotes understanding and goodwill among different countries.
  • Businesses and investors get much wider opportunities for investment.
  • Adverse impact of fluctuations in agricultural productions in one area can be reduced by pooling of production of different areas.
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Negative Effects of Globalization:

  • Developed countries can stifle development of undeveloped and under-developed countries.
  • Economic depression in one country can trigger adverse reaction across the globe.
  • It can increase spread of communicable diseases.
  • Companies face much greater competition. This can put smaller companies, at a disadvantage as they do not have resources to compete at global scale.
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Definition of Globalization
Globalization Definition
Summary of Globalization