Globalization is the tendency of investment funds and businesses to move beyond domestic and national markets into other markets around the world, thereby increasing the interconnection of the planet. Globalization has had the effect of markedly increasing international trade and cultural exchange.
BREAKING DOWN ‘Globalization’
Proponents of globalization say that it assists developing countries catch up to industrialized nations much quicker through increased employment and technological improvements; critics of globalization say that it weakens national sovereignty and allows rich nations to send domestic jobs overseas where labor is much cheaper.
Globalization can be used to explain the recent integration of domestic markets, businesses, cultures and government policies around the world. This integration has occurred through increases from the technical skills and efficiency of world trade, communication and transport. Mostly, globalization refers to the economic integration of the international markets, but it’s also utilized to refer to the socio-cultural integration that has been brought on by the growth of the Internet.
Public policy and technology are the two primary driving factors behind current globalization. Recent implementations of government policy, both domestic and internationally, have opened economic boundaries for countries throughout the world. Over the last twenty years, world governments have integrated a free-market financial system into fiscal policies, monetary policies and trade agreements. This evolution of financial systems has sparked national production capacity and opened nations to increased financial opportunities abroad. World governments now concentrate on decreasing barriers to trade and actively promote international commerce in relation to investments, goods and services.
Technology has also been a major reason behind its growth in globalization. Advancements in information technology (IT) and the flow of data across boundaries have empowered individuals to take control of their financial lives. Technology has helped people become more informed about economic trends and allows people to move financial assets and take advantage of investment opportunities. Technology has increased the capacity to communicate internationally, closing the gap between different cultures.
The Controversy Behind Globalization
At first glance, globalization is an wonderful development. Those who believe in globalization as a force of good cite increases in standards of living in developing nations as advantages of globalization. People who do not believe in globalization, however, cite the fact that it has disproportionately benefited corporations in the Western world in the damage of developing economies, cultures and individuals. These critics actively work to strengthen domestic markets at the expense of free trade.