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.
There are three types of globalization namely:
POSITIVE AND NEGATIVE EFFECTS OF GLOBALIZATION
POSITIVE EFFECTS OF GLOBALIZATION
FREE MOVEMENT OF LABOR
INCREASE IN COMPETITION
INCREASE IN INVESTIMENTS
BENEFITS FROM CHANGING TAX SYSTEMS
The desire of businesses to benefit from lower unit labor costs and other favorable production factors abroad has encouraged countries to adjust their tax systems to attract foreign direct investment (FDI). Many countries have become engaged in tax competition between each other in a bid to win lucrative foreign investment projects
DECREASE IN PROTECTIONISM
Old forms of non-tariff protection such as import licensing and foreign exchange controls have gradually been dismantled. Borders have opened and average import tariff levels have fallen. That said, it is worth knowing that, in the last few years, there has been a rise in non-tariff barriers such as import quotas as countries have struggled to achieve real economic growth and as a response to persistent trade and current account deficits
GROWTH OF MULTINATIONAL COMPANIES
In their pursuit of revenue and profit growth, increasingly global businesses and brands have invested significantly in expanding internationally. This is particularly the case for businesses owning brands that have proved they have the potential to be successfully globally, particularly in faster-growing economies fueled by growing numbers of middle class consumers.
POSITIVELY IMPACT EDUCATION
Spread of technology
raise worker s skills
Using non-renewable resources
Economies of scale
Many economists believe that there has been an increase in the minimum efficient scale (MES) associated with some industries. If the MES is rising, a domestic market may be regarded as too small to satisfy the selling needs of these industries. Many emerging countries have their own transnational corporations
Spread of Culture
Happens when the cultural beliefs and social activities are spread through different ethnicities, religions.
NEGATIVE EFFECTS OF GLOBALIZATION
Free Trade Can Harm Developing Economy
CONCERNS IN ENVIRONMENTAL ISSUES
CULTURAL EROSION AND DIFFUSION
When the local cultures are lost, the world culture will replace.
NEGATIVELY IMPACT EDUCATION
Local schools cannot compete
LOSS OF JOBS
Rich nations outsource their manufacturing and white-collar jobs to developing economies
INCREASE IN CRIME
It has led to an increase in activities such as: child labour and hard working conditions
Consumerism habits has increase junk food, branded products.
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