Globalization Is Not New A Trend Economics Essay

Globalization is not new a phenomenon, for a large number of years people functioning on their own and later organizations used to trade products and services (trade) to the other person on lands, shores and seas at great distances, great example is the famous Silk Street across Central Asia that connected China and European countries during the Middle Ages.

Under the word of Globalization political scientists promote the process of discussion and integration amongst the individuals, companies and government authorities of different countries, a process which is motivated by international trade and investment and aided through advertising and modern solutions. This process influences straight or indirectly the surroundings, culture, politics system, financial development and prosperity of every individual nation and each and every person on earth.

There will vary types of Globalization or blend of these types. To comprehend better the purposes and types of procedures that occurred in each circumstances, we have to analyze each kind separately.

Financial Globalization/Integration

Financial Globalization is the procedure through which financial markets within an economy are more closely included (related) with those in other economies or those in all of those other world through the financial moves.

Types of integration

Integration of the general public sector based on borrowing. You will find two types: the issuance of forex debts, and the issuance of the neighborhood currency debt

Integration based on foreign direct investment, which is immediate investment into the production or business in a single country with a company from another country

Integration of the organization sector where the investors buy or sell the companies and bonds of other countries company in domestic advantage market

The integration of the Banking sector through the interbank market, banking institutions can borrow or give temporarily

Economic Globalization

International economy improved upon due to the effect of globalization. Many countries remove their edges or create trade contracts to be able to improve the inflow of trade as the result markets become more efficient, successful, competitive and cooperative. Types of economic globalization are: NAFTA, European union and MNC's.

Technological Globalization

New and advanced technology take part in making globalization possible, using airplanes, satellites, telephones, tv sets and computers you'll be able to transfer information from one destination to another, with greater efficiency and success which characterizes the modern world. In this manner not only systems are being transferred, but at the same time people can obtain information, knowledge and skills.

Political Globalization

Economical and social globalization has as a result countries to become more interconnected politically. Regular movement of individuals, money and information creates a whole lot of fortunes but also misfortunes, such as criminal offense, because of this in 2002 the International Criminal Court was proven to struggle those sorts of problems. Other politics issues that contain been talked about on global bases are that of global climate change, the terrorism, medication traffic etc.

Cultural Globalization

Today the ease of extension of traditional customs has brought Globalization of cultures, where people from different parts of the entire world can get closer to each other much easier. The icon of the ethnical globalization is the popular American junk food chain McDonald's, they have more than 31, 000 restaurants in 118 countries. Some menu products, including the Big Mac, will be the same all over the world. Other menu products may be specific to a specific region. McDonalds in Japan features a green-tea flavored milkshake. At McDonald's in Uruguay, a "McHuevo" is a burger topped with a fried egg. Globalization has brought McDonald's vast amounts of customers-consumers worldwide. Other cultural movements that someone can find common in many countries are the music, clothes, film companies etc.

Ecological Globalization

Ecological Globalization refers to the collective impact that the diverse techniques of Globalization have on the fitness of the natural systems. Due to Globalization people, money, ideas and air pollution travel at high speeds and rates in every spot of the world. To address these issues, from Stockholm Declaration 1972-till day, lots of discussions have taken host to the needs and strategies for the cover of ecology and environment on a Global level. The UN Conferences from Stockholm proclaimed certain fundamental guidelines of international environmental laws, such as Polluter Gives Principle, Precautionary Theory, Sustainable Development, Intergenerational Collateral and responsibility, Common but differentiated responsibilities, Rights of individuals, equality of usage of methods and non-discrimination in environmental concerns etc. These principles have been proclaimed after extensive investigations done by experts in their fields.

Sociological Globalization

The term sociable globalization refers to the impact of the globalization on the life and work of individuals, their own families and their societies. Important issues like work, working conditions, income and cultural protection are often raised and linked with this part of globalization.


So very good, we evaluated the types of global involved nations, it means that every union (included two or more countries) may follow some of these specific patterns independently, or can include all the assortment of Globalization's types, it all is determined by the contracts between the members. From now on, we will look at the advantages and cons that union users enjoy through the process of Globalization.

2. 1 Advantages

Free Trade: is a means of easier exchange of goods and services. The foundation of the trade agreement is the reduction of import and export edges, through the reduction of any levies, duties, taxes, subsidies and quotas. The lack or reduction of some or all of those factors, usually leads to a significant increase of exchange of goods and services between the member areas.

Another important benefit of the trade contract is the concept of comparative advantage. Corresponding to David Ricardo countries increase their financial well-being if and only when they are specialised in the development of goods at which they may be best at and after on exchange the surplus of creation with other goods of other countries.

Greater Competition: because of the simple free entrance in virtually any member state, there is a inclination for private organizations from any field to go into free market, of course the reason behind such action is only to gain more profit, however the complete problem is that to compete, companies have to lessen their prices to gain more and new customers because the more companies enjoy being on the market the greater competitive and effective they need to be, first of all to have the ability to stay in the marketplace and make offers and secondly to have the ability to make profit from the complete process.

Free activity of labor: free activity of work force gives an external support to huge industrial entities to reach a higher level of efficiency (at reduced costs), it isn't a top secret that the biggest industrial companies in developed countries use many foreign employees who are participants of less developed areas. In this case both parts are in gain the makers maybe because of deficit of domestic pressure or may be because of unwillingness of domestic labor to execute the specific responsibilities and jobs. On the other hand, labor force from less developed countries because of lower quality of life and maybe very high rate of unemployment tend to be willing to perform heavy or dirty jobs to protect their basic needs. Both of these phenomena show how important the free movements of labor can be.

Increased Economies of Level: as observed before, free trade causes a comparative edge (any country customized at a particular subject at which it is most effective). It can be also added that the field of expertise in a single sector can lead to a better working mechanism (human being/machinery) and achieve as better efficiency as it can be. The result of field of expertise and better mechanization normally extends to larger output with lower costs (market of range) because of far better use of resources.

Investments: One other very important good thing about globalization is the investment. So when we discuss investment from the financial viewpoint, we mean the procedure of putting money into something with the expectation of gaining profit after specific or none specific time frame. A few examples of investment may be some kind of foreign equity, property and predetermined interest securities. Organizations invest big money into producing countries for personal reasons and incredibly often copy their production capacity to those countries. These kinds of actions give a huge incentive to both of the celebrations to accomplish more revenue (duty).

2. 2 Disadvantages

As we stated before, free trade offers some very good advantages but at the same time there may be one very important disadvantage of domestic inefficiency. To become clearer nowadays it is very difficult to create and preserve any new organization, even domestically. Huge international firms simply do not give a chance to any new firm to operate in their domains, they often produce products and services at lower prices and bigger ranges than any new firm can. Great example of the kind company is Microsoft, at the present Microsoft is one of the primary corporations which specializes in anything that is due to electronics, computers, hardware, software, electronic digital games and so forth. Generally speaking, in a few sectors Microsoft has practically monopolized the world market and it's very difficult for just about any new and small company to survive in this kind of competition.

Environmental costs: there is another big disadvantage of globalization, the increased use of non renewable resources. Because of better and easier ways of communication between states, there's a tendency to get more detailed and cheaper resources. Every year millions of a great deal of raw material (rock-oil, gas, coal) is excavated from the depths of the ground and unveiled for global ingestion while no one can predict what will be the real cost that people must pay in forseeable future for such procedures.

Also an added issue of globalization is that corporations which copy their functions to places where environmental specifications are less strict. For example, this type of problem is very common in China where international manufacturers that produce and utilize, sometimes follow tactics that harm not only the surroundings but also the fitness of their workers.

Labor Drain: may be the most important problem for the growing and developed countries. Even as stated before, one of the advantages of globalization is the movements of labor force. Although at first side it may well not affect directly if labor leaves one country and migrates one to the other, but if think than it thoroughly someone can easily see that along this labor force can also be potential or future potential intellects that could change the world as we realize today. For example, we can speak about the U. S. A who spends large amounts of money to get and keep the most talented researchers from all around the globe, it's no coincidence that they are the biggest armed service power and make investments a lot of money in new systems.

Less Cultural Diversity: an added issue of globalization is the global centralization of culture based on western ideology from the very young age. However this is actually the reality, people from generation to generation are leaving their traditional culture. People have a tendency to emulate the habit, the lifestyle, the way of life of the western civilization. They expand up watching the Simpsons, eating in McDonalds, enjoying Coca-Cola, wearing trousers and speaking in British. After few ages, most European residents will be people with common values, action, moral and ideologies.


From all the above it can be figured globalization may offer many positive trends but at the same time many negatives, in ways it symbolizes the old aphorism of one gold coin with two very different sides. It could promote economies to develop, produce products and services that could haven't been available in some parts of the planet before, but at the same time it could endorse human being exploitation, inequality and environmental unconsciousness.

Also We Can Offer!

Other services that we offer

If you don’t see the necessary subject, paper type, or topic in our list of available services and examples, don’t worry! We have a number of other academic disciplines to suit the needs of anyone who visits this website looking for help.

How to ...

We made your life easier with putting together a big number of articles and guidelines on how to plan and write different types of assignments (Essay, Research Paper, Dissertation etc)