essay on effects of globalization

Effects of Globalization

Definition of globalization, drivers of globalization.

Globalization is defined as interaction among different countries in order to develop global economy. It entails political, technological, cultural and political exchanges which are facilitated by infrastructure, transport and communication. Some of the traditional international theories of globalization include Ricardian theory of international trade, Heckscher-Ohlin model and Adam Smith’s model (Scholte, 2005).

For globalization to take place, it must be driven by certain factors. The first factor that drives globalization is competitiveness in the market, which focuses on aspects such as global competitors, interdependence among countries and high two-way trade. The second factor that drives globalization is the government.

The government drives globalization through regulation of marketing activities, provision of technical standards that are compatible and elimination of restrictions imposed on trade and investment procedures. The third factor that drives globalization is cost.

Cost in globalization deals with efficiency in sourcing activities, world economies and emerging technological trends. The fourth factor that drives globalization is market, which covers ordinary needs of customers, channels of world markets and marketing techniques that can be transferred to different regions.

Globalization is associated with both positive and negative effects. Its first positive effect is that it makes it possible for different countries to exchange their products. The second positive effect of globalization is that it promotes international trade and growth of wealth as a result of economic integration and free trade among countries.

However, globalization is also associated with negative effects. Its first negative effect is that it causes unemployment. Since companies compete with their rivals in the market, sometimes they are forced to sack some of their employees in order to reduce salary costs and instead maximize profits. This is common in developing countries, where large numbers of unemployed people live in urban areas.

The second negative effect of globalization is that it promotes terrorism and criminal activities because people, food and materials are allowed to move freely from one country to the other. Individuals with evil intentions take advantage of this freedom and carry out terrorism activities and other crimes (Negative Effects of Globalization, 2013).

Negative Effects of Globalization. (2013). Web.

Scholte, J. (2005). Globalization: A Critical Introduction. New York: Palgrave Macmillan.

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✍️Essay on Globalisation: Samples in 100, 150 and 200 Words

• Updated on  
• Oct 25, 2023

Globalisation means the combination of economies and societies with the help of information, ideas, technology, finance, goods, services, and people. It is a process where multinational companies work on their international standing and conduct operations internationally or overseas. Over the years, Globalisation has had a profound impact on various aspects of society. Today we will be discussing what globalisation is and how it came into existence with the essay on globalisation listed below.

This Blog Includes:

How globalisation came into existence, essay on globalisation in 100 words, essay on globalisation in 150 words, essay on globalisation in 200 words.

For all those unaware, the concepts of globalisation first emerged in the 20th century. Here are some of the key events which led to the development of globalisation in today’s digital world.

• The ancient Silk Route as well as the maritime routes led to the exchange of goods, ideas and culture in several countries. Although these were just trade routes, but later became important centres for cultural exchange.
• Other than this, the European colonial expansion which took place from the 15th to the 20th century led to the setting up of global markets where both knowledge and people were transferred to several developing countries. 
• The evolution and exchange of mass media, cinema and the internet further led to the widespread dissemination of cultures and ideas.

Also Read: Essay on the Importance of the English Language for Students

Globalization, the interconnectedness of nations through trade, technology, and cultural exchange, has reshaped the world. It has enabled the free flow of goods and information, fostering economic growth and cultural diversity. However, it also raises challenges such as income inequality and cultural homogenization. 

In a globalized world, businesses expand internationally, but local industries can suffer. Moreover, while globalization promotes shared knowledge, it can erode local traditions. Striking a balance between the benefits and drawbacks of globalization is essential to ensure a more equitable and culturally diverse global community, where economies thrive without leaving anyone behind.

Also Read: Essay on Save Environment: Samples in 100, 200, 300 Words

Globalization is the process of increasing interconnectedness and interdependence among countries, economies, and cultures. It has transformed the world in various ways.

Economically, globalization has facilitated the flow of goods, services, and capital across borders. This has boosted economic growth and reduced poverty in many developing nations. However, it has also led to income inequality and job displacement in some regions.

Culturally, globalization has resulted in the spread of ideas, values, and cultural products worldwide. While this fosters cultural exchange and diversity, it also raises concerns about cultural homogenization.

Technologically, globalization has been driven by advances in communication and transportation. The internet and smartphones have connected people across the globe, allowing for rapid information dissemination and collaboration.

In conclusion, globalization is a complex phenomenon with both benefits and challenges. It has reshaped the world, bringing people closer together, but also highlighting the need for responsible governance and policies to address its downsides.

Also Read: Essay on Unity in Diversity in 100 to 200 Words

Globalization, a multifaceted phenomenon, has reshaped the world over the past few decades. It involves the interconnectedness of economies, cultures, and societies across the globe. In this essay, we will briefly discuss its key aspects and impacts.

Economically, globalization has led to increased international trade and investment. It has allowed companies to expand operations globally, leading to economic growth in many countries. However, it has also resulted in income inequality and job displacement in some regions.

Culturally, globalization has facilitated the exchange of ideas, values, and traditions. This has led to a more diverse and interconnected world where cultures blend, but it can also challenge local traditions and languages.

Socially, globalization has improved access to information and technology. It has connected people across borders, enabling global activism and awareness of worldwide issues. Nonetheless, it has also created challenges like cybercrime and privacy concerns.

In conclusion, globalization is a double-edged sword. It offers economic opportunities, cultural exchange, and global connectivity, but it also brings about disparities, cultural tensions, and new global challenges. To navigate this complex landscape, the world must strive for responsible globalization that balances the interests of all stakeholders and promotes inclusivity and sustainability.

Related Articles

The movement of goods, technologies, information, and jobs between countries is referred to as globalisation. 

Globalization as a phenomenon began with the earliest human migratory routes, or with Genghis Khan’s invasions, or travel across the Silk Road.

Globalisation allows wealthy nations to access cheaper labour and resources, while also providing opportunity for developing and underdeveloped nations with the jobs and investment capital they require.

For more information on such interesting topics, visit our essay-writing page and follow Leverage Edu ! 

Malvika Chawla

Malvika is a content writer cum news freak who comes with a strong background in Journalism and has worked with renowned news websites such as News 9 and The Financial Express to name a few. When not writing, she can be found bringing life to the canvasses by painting on them.

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ENCYCLOPEDIC ENTRY

Globalization.

Globalization is a term used to describe the increasing connectedness and interdependence of world cultures and economies.

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Globalization is a term used to describe how trade and technology have made the world into a more connected and interdependent place. Globalization also captures in its scope the economic and social changes that have come about as a result. It may be pictured as the threads of an immense spider web formed over millennia, with the number and reach of these threads increasing over time. People, money, material goods, ideas, and even disease and devastation have traveled these silken strands, and have done so in greater numbers and with greater speed than ever in the present age. When did globalization begin? The Silk Road, an ancient network of trade routes across China, Central Asia, and the Mediterranean used between 50 B.C.E. and 250 C.E., is perhaps the most well-known early example of exchanging ideas, products, and customs. As with future globalizing booms, new technologies played a key role in the Silk Road trade. Advances in metallurgy led to the creation of coins; advances in transportation led to the building of roads connecting the major empires of the day; and increased agricultural production meant more food could be trafficked between locales. Along with Chinese silk, Roman glass, and Arabian spices, ideas such as Buddhist beliefs and the secrets of paper-making also spread via these tendrils of trade. Unquestionably, these types of exchanges were accelerated in the Age of Exploration, when European explorers seeking new sea routes to the spices and silks of Asia bumped into the Americas instead. Again, technology played an important role in the maritime trade routes that flourished between old and newly discovered continents. New ship designs and the creation of the magnetic compass were key to the explorers’ successes. Trade and idea exchange now extended to a previously unconnected part of the world, where ships carrying plants, animals, and Spanish silver between the Old World and the New also carried Christian missionaries. The web of globalization continued to spin out through the Age of Revolution, when ideas about liberty , equality , and fraternity spread like fire from America to France to Latin America and beyond. It rode the waves of industrialization , colonization , and war through the eighteenth, nineteenth, and twentieth centuries, powered by the invention of factories, railways, steamboats, cars, and planes. With the Information Age, globalization went into overdrive. Advances in computer and communications technology launched a new global era and redefined what it meant to be “connected.” Modern communications satellites meant the 1964 Summer Olympics in Tokyo could be watched in the United States for the first time. The World Wide Web and the Internet allowed someone in Germany to read about a breaking news story in Bolivia in real time. Someone wishing to travel from Boston, Massachusetts, to London, England, could do so in hours rather than the week or more it would have taken a hundred years ago. This digital revolution massively impacted economies across the world as well: they became more information-based and more interdependent. In the modern era, economic success or failure at one focal point of the global web can be felt in every major world economy. The benefits and disadvantages of globalization are the subject of ongoing debate. The downside to globalization can be seen in the increased risk for the transmission of diseases like ebola or severe acute respiratory syndrome (SARS), or in the kind of environmental harm that scientist Paul R. Furumo has studied in microcosm in palm oil plantations in the tropics. Globalization has of course led to great good, too. Richer nations now can—and do—come to the aid of poorer nations in crisis. Increasing diversity in many countries has meant more opportunity to learn about and celebrate other cultures. The sense that there is a global village, a worldwide “us,” has emerged.

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Effects of Globalization

How It Impacts Society and the Economy

Positive Effects of Globalization

Negative effects of globalization, protectionism through tariffs, future outlook, frequently asked questions (faqs).

The Balance

Globalization refers to the increasingly integrated nature of economies around the world. This integration has both positive and negative effects.

The hope is that increased global trade will lead to more competition, which will spread wealth more equally. Those who are in favor also claim that trade across borders will help limit military conflicts. However, there are downsides to boosting trade between countries . Some critics point to globalization as a factor in rising nationalism and income inequality, among other issues.

Learn more about the pros and cons of globalization to understand how it affects economies and individuals.

Key Takeaways

• The benefits of globalization for countries include foreign direct investment and technological innovation.
• For companies, globalization allows for more efficient operations through economies of scale.
• The downsides of globalization include potential issues with interdependence and loss of sovereignty.

The Milken Institute's "Globalization of the World Economy" report of 2003 noted many of the pros and cons of globalization. Although nearly two decades have passed since the report came out, the ideas behind it remain relevant.

Some of the pros of increased global trade include:

Foreign Direct Investment

Foreign direct investment  (FDI) tends to grow at a much greater rate than world trade does. This can help to boost technology transfer, industrial restructuring, and the growth of global companies.

Technological Innovation

Increased competition helps inspire new technology development. The growth in FDI helps improve economic output by making processes more efficient.

Economies of Scale

Increased global trade enables large companies to realize  economies of scale . This reduces costs and prices, which in turn supports further growth. However, this can hurt many  small businesses  trying to compete at home.

Some of the risks of increased global trade include:

Interdependence

Interdependence between nations can cause local or global instability. This occurs if local economic fluctuations end up impacting a large number of countries relying on them. For example, in 2020, Ukraine was the fifth larger exporter of wheat. When Russia invaded the country, it threatened food supply chains for countries like Pakistan, Lebanon, and Vietnam that import Ukrainian wheat.

National Sovereignty

Some see the rise of nation-states, global firms, and other international organizations as a threat to sovereignty. Ultimately, this could cause some leaders to become nationalistic.

Two prominent examples of the rise of nationalism as a pushback to globalism include the 2016 election of Donald Trump in the U.S. and the British vote to leave the European Union (known as  " Brexit "). These events contributed to the anti-globalization movement and stoked anti-immigration sentiments.

Equity Distribution

The pros of globalization can be unfairly skewed toward rich nations or individuals, creating greater economic inequalities. For example, in the wake of NAFTA, the average net weekly pay for maquila workers was $55.77 in 1998—less than $2 more than the average cost for basic needs in the maquiladora trade zone.

Dani Rodrik, author of Straight Talk on Trade: Ideas for a Sane World Economy , argues for a rebalancing of globalization.

In a 2017 piece for the Milken Institute Review , Rodrik notes that current policies "produce[s] losers as well as winners." For instance, workers are left with a less stable labor market. In Europe, these workers were given a strong social safety net. The U.S., Rodrik says, "let the chips (and workers) fall where they may."

To fix globalization's problems while keeping benefits, Rodrik suggests several changes. Chief among them: giving labor a stronger voice, shifting from global governance to national governance, and focusing attention on where the biggest economic gains can be made.

The 2008 economic crisis led many politicians to question the merits of globalization. In 2007, worldwide capital inflows accounted for more than 20% of the world's GDP. By 2019, this figure fell to less than 5%.

The U.S. and Europe introduced new banking regulations that limited capital flows. Many countries put in place tariffs to protect vital industries at home. In the 1990s, the U.S. placed a 127% tariff on Chinese paper clips. And Japan has levied tariffs on imported rice as high as 778%.

Some economists suggest that businesses are not investing across borders to build capital infrastructure. They argue that companies seek countries with low taxes. Some form of globalization may be inevitable in the long run, but the historic bumps spurred by economic crises suggest that change is the only constant.

Revenues from U.S. tariffs on Chinese imports increased from $32.9 billion in 2017 to $85 billion in 2021. American farmers hurt by China moving crop purchases to other countries were promised $28 billion in federal compensation.

When did globalization begin?

Economists differ on when globalization began. Some point to people like Christopher Columbus as an early force of globalization in the 15th century. Others point back thousands of years to the founding of the Silk Road. Both the World Economic Forum and the National Bureau of Economic Research argue that the technological advancements of the 19th century allowed it to become the first true era of globalization.

Which countries are the least affected by globalization?

Some countries rely more or less on global trade than others. The KOF Swiss Economic Institute scores countries on a globalization index. Afghanistan and Somalia were among the lowest-scoring countries on that index. More isolated countries, like North Korea, didn't score on the index at all.

Milken Institute. " Globalization of the World Economy ," Pages 2-9.

Organisation for Economic Co-operation and Development. " Foreign Direct Investment for Development ," Page 5.

Milken Institute. " Globalization of the World Economy ," Page 9.

Milken Institute. " Globalization of the World Economy ," Page 10.

Milken Institute. " Globalization of the World Economy ," Page 12.

Observatory of Economic Complexity. " Wheat in Ukraine ."

Homeland Security Digital Library. " Globalization vs. National Sovereignty ."

The World Bank. " Theorist Eric Maskin: Globalization Is Increasing Inequality ."

Washington University in St. Louis. " The Pros and Cons of Globalization ," Page 3.

Milken Institute Review. " The Trouble With Globalization ," Page 2.

Bank for International Settlements. " Changing Patterns of Capital Flows ," Page 4.

Federal Register. " Certain Paper Clips From the People's Republic of China: Final Results of Expedited Fourth Sunset Review of Antidumping Duty Order ."

Food and Fertilizer Technology Center for the Asian and Pacific Region. " Trade Liberalization and Rice Farming in Japan and Heilongjiang China ."

Center for Strategic and International Studies. " China Tariffs: Digging Out of the Hole ."

American Enterprise Institution. " Agricultural Trade Aid ," Page 1.

World Economic Forum. " A Brief History of Globalization ."

National Bureau of Economic Research. " When Did Globalization Begin? ," Pages 1-2, 26-28.

KOF Swiss Economic Institute. " KOF Globalisation Index ," Download "Ranking_2021" XLSX.

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The State of Globalization in 2021

• Steven A. Altman
• Caroline R. Bastian

Trade, capital, and information flows have stabilized, recovered, and even grown in the past year.

As the coronavirus swept the world, closing borders and halting international trade and capital flows, there were questions about the pandemic’s lasting impact on globalization. But a close look at the recent data paints a much more optimistic picture. While international travel remains significantly down and is not expected to rebound until 2023, cross-border trade, capital, and information flows have largely stabilized, recovered, or even grown over the last year. The bottom line for business is that Covid-19 has not knocked globalization down to anywhere close to what would be required for strategists to narrow their focus to their home countries or regions.

Cross-border flows plummeted in 2020 as the Covid-19 pandemic swept the world, reinforcing doubts about the future of globalization. As we move into 2021, the latest data paint a clearer — and more hopeful — picture. Global business is not going away, but the landscape is shifting, with important implications for strategy and management.

• Steven A. Altman is a senior research scholar, adjunct assistant professor, and director of the DHL Initiative on Globalization at the NYU Stern Center for the Future of Management .
• CB Caroline R. Bastian is a research scholar at the DHL Initiative on Globalization.

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Essay on Globalization for Students and Children

500+ words essay on globalization.

Globalization refers to integration between people, companies, and governments. Most noteworthy, this integration occurs on a global scale. Furthermore, it is the process of expanding the business all over the world. In Globalization, many businesses expand globally and assume an international image. Consequently, there is a requirement for huge investment to develop international companies.

How Globalization Came into Existence?

First of all, people have been trading goods since civilization began. In the 1st century BC, there was the transportation of goods from China to Europe. The goods transportation took place along the Silk Road. The Silk Road route was very long in distance. This was a remarkable development in the history of Globalization. This is because, for the first time ever, goods were sold across continents.

Globalization kept on growing gradually since 1st BC. Another significant development took place in the 7th century AD. This was the time when the religion of Islam spread. Most noteworthy, Arab merchants led to a rapid expansion of international trade . By the 9th century, there was the domination of Muslim traders on international trade. Furthermore, the focus of trade at this time was spices.

True Global trade began in the Age of Discovery in the 15th century. The Eastern and Western continents were connected by European merchants. There was the discovery of America in this period. Consequently, global trade reached America from Europe.

From the 19th century, there was a domination of Great Britain all over the world. There was a rapid spread of international trade. The British developed powerful ships and trains. Consequently, the speed of transportation greatly increased. The rate of production of goods also significantly increased. Communication also got faster which was better for Global trade .

Finally, in 20th and 21st -Century Globalization took its ultimate form. Above all, the development of technology and the internet took place. This was a massive aid for Globalization. Hence, E-commerce plays a huge role in Globalization.

Get the huge list of more than 500 Essay Topics and Ideas

Impact of Globalization

First of all, Foreign Direct Investment (FDI) increases at a great rate. This certainly is a huge contribution of Globalization. Due to FDI, there is industrial development. Furthermore, there is the growth of global companies. Also, many third world countries would also benefit from FDI.

Technological Innovation is another notable contribution of Globalization. Most noteworthy, there is a huge emphasis on technology development in Globalization. Furthermore, there is also technology transfer due to Globalization. The technology would certainly benefit the common people.

The quality of products improves due to Globalization. This is because manufacturers try to make products of high-quality. This is due to the pressure of intense competition. If the product is inferior, people can easily switch to another high-quality product.

To sum it up, Globalization is a very visible phenomenon currently. Most noteworthy, it is continuously increasing. Above all, it is a great blessing to trade. This is because it brings a lot of economic and social benefits to it.

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• Globalisation Essay

Essay on Globalisation

Globalization means the integration of economies and societies through the flow of information, ideas, technology, goods, services, capital, finance, and people. The true meaning of Globalization in a broad sense is connecting in all areas of human life. It is the process by which other companies or organizations enhance their international reputation or start operating internationally. 

Globalization began thousands of years ago when people and companies bought and sold in distant lands. In the Middle Ages, Central Asia was connected to China and Europe via the famous Silk Road. After World War II and the last two decades, governments of many countries have adopted free-market economies. They have greatly increased their own production potential and created countless new opportunities for international trade and investment. New routes and means to transport goods have been discovered, which has allowed the people to expand their business easily and efficiently. 

The government has reduced all trade barriers and concluded new international agreements to promote trade in goods, services and investment. This profitable action has created opportunities for international trade. In foreign markets, companies with these new opportunities set up new factories and establish production and marketing relationships with foreign partners. Hence, Globalization is defined as an international industrial and financial enterprise.

Overview of Globalization

Globalization means the assimilation of economics and societies through the flow of information, ideas, technologies, goods, services, capital, finance, and people. The real meaning of Globalization in a broad sense is connectivity in all aspects of human life. It is the process where the businesses or other organizations expand international authority or start operating on an international scale.

How the Existence of Globalization Came Into Being?

Globalization had started many thousands of years ago when people and corporations were buying and selling across lands at great distances. In the middle age, Central Asia connected with China and Europe through the famed Silk Road. After the Second World War II and during the last two decades, the governments of many countries have adopted free-market economic systems. They increased their own productive potential immensely and created innumerable new opportunities for international trade and investment.

The governments have reduced all barriers to commerce and established new international agreements to promote trade in goods, services and investments. These beneficial measures gave rise to opportunities for global trade. With these new opportunities in the foreign markets, corporations established new factories and started production and marketing alliances with foreign partners. Hence, Globalization is defined as an international industrial and financial business structure.

Advantages and Disadvantages

The frontiers of the state with increased confidence in the market economy and renewed policies in the private capital and resources, a process of structural adjustment spurred by the studies and with the support of the World Bank and other international organizations have started in many of the developing countries. Globalization has also brought in new opportunities to developing countries. Greater access to developed country markets and technology transfer has promised to improve their productivity and higher standards. 

At the same time, Globalization has also created challenges like growing inequality across and within nations, instability in the financial market and environmental deterioration. Globalization is a fascinating exhibition that can be understood as a global system of competition and connectivity. It has created tough competition among countries and global corporations.

Impact of Globalization in India

The British Colonial rule had destroyed the self-sufficient economy of India and left India to be the poorest Independent country. Our first Prime Minister gave preference to a mixed economy to boost the economic condition of the country. Public sectors were set up along with the private enterprises, but because of the socialistic model of the economy, the new strategy did not produce profitable results. Due to this, a number of public sectors became sick and the growth rates of production began to fall. 

During that time, the poverty of the people in India was increasing at an alarming rate and because of low domestic savings and acute balance of payment crisis, there was no adequate capital for investment. During that time of crisis, Prime Minister PV Narsimha Rao introduced the policy of liberalization, privatization to overcome the financial situation. 

India opened up to Globalization after the economic policy of 1991 came into force. Mounting debts and pressure from the International Monetary Fund drove the nation to go global. The process of Globalization has been an integral part of the recent economic growth of India. Globalization has played a very significant role in the growth of export, leading to the expansion of the job market in India. One of the major sectors of Globalization in India has been in the growth of outsourced IT and Business Process Outsourcing services. There has been an incredible increase in the number of skilled professionals in India employed by domestic and foreign companies to cater service to the customers globally, especially in the USA and Europe. 

There was not a doubt that Globalization in India brought a monumental change in the living standards of the people. People in India realized many benefits from Globalization. The establishment of multinational companies generating billions of jobs and access to umpteen numbers of brands and an increase in the forex reserves of the country took India to a higher platform globally. Despite this monumental change in the economy of the country, India also faced the challenges of severe competition from the foreign market and the domestic producers started fearing marginalization and pulverization because of the better quality products produced by the foreign producers.

Globalization had both desirable and undesirable consequences for India and the world. Even though it has accelerated progress in some countries, it has also widened the gap between the rich and the poor.

The impact of Globalization has been both positive and negative on the entire world, but we can surely hope for more advancement in the global economy due to this process.

FAQs on Globalisation Essay

1. How Did Globalization Help India to Improve the Economic Conditions?

Globalization generated umpteen employment opportunities for the people of India by establishing multinational companies. The policy of liberalization and privatization invited foreign traders to do business with India. This has increased the inflow of men, money, material, labor, technology, etc., from foreign countries to India. People have access to foreign brands and the living standards have improved drastically.

2. How is Globalization a Threat to Domestic Producers?

The domestic producers fear marginalization and pulverization because of the entry of foreign and better quality products.

3. What are the advantages and disadvantages of Globalization?

With increasing confidence in market economies and new policies on private capital and resources, many developing countries are beginning to adapt to developments with the support of the World Bank and other international institutions involved in research and development. Globalization also offers new opportunities for developing countries. Greater access to markets in developed countries and the transfer of technology will increase their productivity and demand.

At the same time, Globalization has created challenges such as increasing inequality between and within countries, instability of financial markets and environmental degradation. Globalization is an interesting exhibition that can also be seen as a system of competition and international relations. This has created intense competition between countries and international companies. 

4. What do you mean by Globalization?

Globalization means the integration of economies and societies through the flow of information, ideas, technology, goods, services, capital, finance, and people. The true meaning of Globalization in a broad sense is a connectedness in all areas of human life. It is the process by which other companies or organizations enhance their international reputation or start operating internationally. Globalization has its own benefits and drawbacks. We can learn more about Globalization and how to write an essay on it in detail on the Vedantu website, which has all the necessary materials that students need in order to write an essay on Globalization. 

5. How can Globalization help India improve its economic situation?

In our present times, Globalization has been a boon to many people as it not only allows companies to expand their business but also makes things accessible for everyone. In a simple sense, we can say that it helps in connecting people with the world. Globalization has created many job opportunities in India through the creation of multinational companies. Policies of liberalization and privatization have encouraged foreign traders to trade with India. This has increased the number of people, money, materials, labor, technology and so on—inflows from abroad to India. People have access to foreign brands and the standard of living has improved significantly.

6. How does Globalization threaten domestic producers?

Domestic producers are afraid of marginalization and due to the entry of foreign and better quality products into the market. Globalization can be associated with increasing income and wealth inequality. Many of the world's poorest people lack access to basic technologies and public goods. They are excluded from treatment. Some critics of globalization point to the loss of economic and cultural diversity as international multinational giants and brands dominate domestic markets in many countries. Globalization can hinder competition if international companies with dominant brands and high technology gain a foothold in key markets, be it telecommunications, the automotive industry, and so on.

7. What are the main industries that have grown tremendously because of Globalization?

The integration of national economies into the global economy is one of the most important developments of the last century. This process of integration, often referred to as Globalization, has manifested itself in a tremendous increase in cross-border trade.

The outsourcing business has grown exponentially due to Globalization. The main industries resulting from Globalization are trade and commerce. Automobile companies, clothing manufacturers and transportation, are the three main industries taken over as a result of Globalization.

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4 Effects of Globalization on the Environment

• 15 Apr 2021

Globalization —defined in the online course Global Business as the increased flow of goods, services, capital, people, and ideas across international boundaries—has brought many changes in its wake.

While globalization can positively and negatively impact society, its effect on the environment is primarily negative. Here’s a breakdown of how globalization impacts society and the environment and what business leaders can do to reduce these negative consequences.

How Does Globalization Affect Society?

The world has become more connected than ever before through the increase in technological advancements and economic integrations. Advanced economies are formed as domestic businesses transform into international ones and further contribute to the spread of technology around the world.

There are several benefits of globalization , such as increased international trade and cooperation and less international aggression. Social globalization —the sharing of ideas and information between countries—has led to innovation in the medical, technological, and environmental preservation industries.

Additionally, globalization has improved the quality of life in several developing nations. This includes implementing efficient transportation systems and ensuring accessibility to services such as education and healthcare.

However, globalization can also have negative effects on society, such as increased income inequality and substandard working conditions in developing countries that produce goods for wealthier nations. Income inequality is directly related to globalization as it further increases the gap between more advanced and developing areas of a nation. As a result, it can also increase the risk of societal violence.

Along with its societal effects, globalization has a lasting impact on the environment—and typically not a positive one.

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What Are the Effects of Globalization on the Environment?

1. Increased Transport of Goods

One of the primary results of globalization is that it opens businesses up to new markets in which they can sell goods and source labor, raw materials, and components.

Both of these realities mean finished products travel farther now than ever before—potentially halfway around the globe. In the past, products were more likely to be produced, sold, and consumed locally. This increased transport of goods can impact the environment in several ways, including:

• Increased emissions: The farther a product travels, the more fuel is consumed, and a greater level of greenhouse gas emissions is produced. According to a report by the International Transport Forum , CO2 emissions from transport will increase 16 percent by 2050. These emissions contribute to pollution, climate change , and ocean acidification around the world and have been shown to significantly impact biodiversity.
• Habitat destruction: Transportation—especially when land-based—requires infrastructure like roads and bridges. The development of such infrastructure can lead to issues including habitat loss and pollution. The more ships that travel by sea, the greater the chances for major oil spills or leaks that damage the delicate marine environment.
• Invasive species: Every shipping container and vessel presents an opportunity for a living organism—from plants to animals to fungus—to hitch a ride to a new location where it can become invasive and grow without checks and balances that might be present in its natural environment.

2. Economic Specialization

One often-overlooked side effect of globalization is that it allows nations and geographical regions to focus on their economic strengths while relying on trading partners for goods they don’t produce themselves. This economic specialization often boosts productivity and efficiency.

Unfortunately, overspecialization can threaten forest health and lead to serious environmental issues, often in the form of habitat loss, deforestation, or natural resource overuse. A few examples include:

• Illegal deforestation in Brazil due to an increase in the country’s cattle ranching operations, which requires significant land for grazing
• Overfishing in coastal areas that include Southeast Asia, which has significantly contributed to reduced fish populations and oceanic pollution
• Overdependence on cash crops, such as coffee, cacao, and various fruits, which has contributed to habitat loss, especially in tropical climates

It’s worth considering that globalization has allowed some nations to specialize in producing various energy commodities, such as oil, natural gas, and timber. Nations that depend on energy sales to fund a large portion of their national budgets, along with those that note “energy security” as a priority, are more likely to take intervening actions in the market in the form of subsidies or laws that make transitioning to renewable energy more difficult.

The main byproduct of these energy sources comes in the form of greenhouse gas emissions, which significantly contribute to global warming and climate change.

3. Decreased Biodiversity

Increased greenhouse gas emissions, ocean acidification, deforestation (and other forms of habitat loss or destruction), climate change, and the introduction of invasive species all work to reduce biodiversity around the globe.

According to the World Wildlife Fund’s recent Living Planet Report , the population sizes of all organisms—including mammals, birds, fish, amphibians, and reptiles—have decreased 68 percent since 1970. Latin America and Africa—two rapidly developing regions important to global trade—have seen disproportionate levels of biodiversity loss, especially among environmentally sensitive fish, reptiles, and amphibians.

While this decrease in biodiversity has many causes, it’s widely believed that the issues listed above have contributed in part.

4. Increased Awareness

While many of globalization’s environmental effects have been negative, its increase has heightened environmental awareness worldwide.

Greater connectivity and higher rates of international travel have made it easier than ever for individuals to see the effects of deforestation, habitat loss, and climate change on the environment. This, in turn, has contributed to new laws, regulations, and processes that limit negative effects.

Globalization as a Threat and an Opportunity

Globalization has allowed society to enjoy many benefits, including increased global cooperation, reduced risk of global conflict, and lower prices for goods and commodities. Unfortunately, it’s also led to serious negative effects on the environment.

Since it isn’t feasible for globalization to end or reverse, it’s likely the situation will worsen until nations, governing bodies, and other organizations are compelled to implement laws and regulations that limit negative effects.

Businesses and industries that operate globally have an incentive to take whatever voluntary actions they can to reduce the potential for negative consequences. Doing so can not only provide an organization greater control over its initiatives, but also a powerful marketing and communication tool .

Some ways businesses address climate change include:

• Transitioning to renewable energy sources
• Choosing greener infrastructures or equipment
• Reducing energy consumption
• Creating credible climate transition plans
• Raising awareness among employees

In addition, investing in renewable energy and packaging, embracing responsible land-use management, and shifting goods production to move closer to the end customer are all viable options that businesses can and should consider. The challenge lies in balancing a desire to embrace corporate social responsibility with the need to turn a profit and run a successful business.

Are you interested in breaking into a global market? Sharpen your knowledge of the international business world with our four-week Global Business course. In addition, explore our Business and Climate Change course to help your organization adapt to and embrace business risks and opportunities created by climate change, as well as our other online courses related to business in society .

This post was updated on February 28, 2024. It was originally published on April 15, 2021.

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Impact of Globalisation (Revision Essay Plan)

Last updated 11 Jan 2022

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Here is a suggested answer to a question on the impact of globalisation on developed and developing countries.

Introductory Context

An estimated 9 percent of the global population still lives below the international poverty line of US$1.90 PPP a day.Success in reducing poverty in East Asia is clear with 7 percent of the population in the region living below the US$3.20 PPP line and 25 percent living below the US$5.50 PPP poverty line in 2018. However, almost 70 percent of Sub-Saharan Africa’s population lives on less than US$3.20 per day. Progress in cutting extreme poverty has been halted by the pandemic. The World Bank estimated that the pandemic pushed between 119 and 124 million people into extreme poverty around the globe in 2020. Many developing countries have limited resilience to the impact of economic shocks and threats from climate change.”.

Source: Adapted from the World Bank Poverty Report, 2021

To what extent have the economic benefits of globalisation favoured developed over developing countries? (25 marks)

KAA Point 1

Globalisation involves deeper integration between countries through networks of trade, capital flows, ideas, technologies and movement of people. One argument that globalisation has favoured high-income countries lies in the growing dominance of TNCs from advanced nations. TNCs base their manufacturing, assembly, research and retail operations across several countries, and many have become synonymous with globalisation namely Nike, Apple, Amazon, Google (Alphabet) and Samsung. Some have annual revenues many times higher than the GDP of smaller low-income countries and there has been fierce criticism of numerous TNCs for following tax avoidance strategies such as transfer pricing. This has reduced tax revenues for governments in developing nations which then hampers their ability to use fiscal policy to fund public services such as education and basic health care. The effect is to limit progress in reducing extreme poverty and improving human development outcomes.

Evaluation Point 1

A counter argument is that globalisation is associated with a steady reduction in import tariffs around the world which has then improved access to high-income markets for businesses from emerging countries. Many nations in east Asia have achieved reductions in extreme poverty driven by export-led growth. The extract says that only 7 percent of this region’s population now live below the US$3.20 PPP poverty line and continued high growth – as economies recover from the effects of the pandemic - will lead to improvements in per capita incomes and living standards. Indeed, sixty percent of the value of world GDP now comes from emerging market and developing economies and several countries have their own TNCs operating on a global scale. The recent success of countries such as South Korea, India and Vietnam is testimony to the opportunities that globalisation has offered developing nations who have developed competitive advantage across a range of industries.

KAA Point 2

A second argument supporting the question is that nations succeeding in a globalizing world have diversified economies, a workforce with flexible skills and governments with fiscal resources to overcome external shocks such as the pandemic. In contrast, poorer low-income countries rely heavily on the production and export of primary commodities or incomes from tourism, both of which have been hit by the global recession in 2020-21. Many poorer nations also haveinadequate infrastructure which increases the costs of trade and their direct tax revenues as a share of GDP are low because of sizeable informal economies and persistently low per capita incomes. This means that national governments rely heavily on external debt, and many have low currency reserves. They are therefore more exposed to economic, financial and public health shocks. This is evidenced by the differences in vaccination rates between rich and low-income countries. As of January 2022, only 9% of people in low-income countries have received at least one dose and per capita incomes may take years to reach pre-2020 levels.

Evaluation Point 2

In evaluation, the globalisation process has been a catalyst for economic reforms in low and middle-income countries. Consider the example of Vietnam which has transitioned to a socialist oriented market economy and successfully attracted inward FDI from companies such as LG and Samsung. FDIhas flowed in helped by low unit labour costs costs, improving infrastructure and human capital and a deregulated business environment whilst the Vietnamesegovernment has moved to a managed floating exchange rateto help reduce some of the risks from regional and global economic shocks. Vietnam is a good example of a country that has successfully progressed from a low income to a low-middle income nation over the last two decades. The valueof their external trade accounts for roughly 180% of national output, more than any other country at its level of per-person GDP. And their educational scores on standardized tests are on a par with Germany and Austria.

Final Reasoned Comment

Overall, it is hard to reach a firm view on this question because globalisation as a process is uneven and not inevitable. Before and during the pandemic, there was evidence of a switch towards “regionalisation” rather than full-throttled globalisation. For example, most sub-Saharan African countries have joined the African Continental Free Trade Area which seeks to boost intra-regional trade and investment and encourage economies of scale among African businesses so that they can better compete against the dominance of Western TNCs. Developing nations often struggle to compete with developed countries, therefore it is argued free trade benefits high-income economies more. Gains from globalisation will never be equitably distributed.And this sense of deepening inequality and opportunity risks a further shift to tariff and non-tariff barriers to trade and moves towards economic nationalism.

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Home Essay Examples Sociology Globalization

The Impact Of Globalization on Society

• Category Sociology
• Subcategory Human Populations
• Topic Globalization

In my opinion, I think that globalization is good for society. Globalization is the course of political, economical, and educational unification. It has changed the world to function as a whole; country borders have been incapacitated between each other. Globalization is playing a crucial role in helping establish society. It has decisive advantages like; technological advancements, governmental authorities, healthcare, and social components. Furthermore, globalization has constructed many circumstances for evolving communities. Opened opportunities for convenient access to the expanding market. Yet it also introduced many challenges; environmental depreciations, fluctuations in monetary and fiscal markets, increase injustice across many societies. In this argumentative paper, I will be arguing in favour of the favourable and benign aspects that globalization affects society in a positive manner. These points include; industrial and business developments, schooling and healthcare systems, and lastly the satisfying cultural effects.

Proliferation aids many societies in dealing with other nearby communities. globalization increases their budgetary prosperity as well as solve many shortage dilemmas. Back in the day, prospering societies couldn’t reach and come in contact with the nationwide frugality due to industrial boundaries. Furthermore, when globalization came into existence, the international board started creating different types of market restores and fundamental innovations. Different societies began opening their local markets by making necessary refinements and bringing changeful tariffs, which ultimately opened up the economy to the global market. More advanced societies invested in those growing businesses and designing all sorts of job opportunities. It’s clear in seeing that globalization has made the liaison between refined societies. Already established societies depend on other resourceful societies which have more expanded technological advancements and such. Due to industrial developments, citizens and raw goods are moved accessibly and swiftly. Mass communications and the vast distribution of data through the internet has helped globalization benefit immensely. Resulting in an increase in free trading between communities. In most scenarios, globalization has turned the economy to grow at an endless pace and universal jubilation, making poor communities adapt and accept new social trends and technologies. Thru immersion of unfamiliar capital and automation, with the chance to cultivate cost-effectively and by widening growth. Businesses share resourceful technology with other businesses, which conclusively help out both parties. Nowadays many societies have used this chance in achieving this delicate objective and by putting in good work, it has caused them to develop and modernize with the help of globalization. Giving a chance for poorly maintained societies to become better and operate efficiently. Furthermore, developing nations set up businesses and industries in poor regulated areas in order to take advantage of; low wage income, creating job opportunities, less costly prices due to many competing companies producing similar goods.

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Globalization provided many healthcare and education organizations throughout many societies. Education has increased over the past decade. This is because globalization has become a great catalyst in jobs that demand a great competence set. Two of the main goals in developing society is its education and healthcare system. Once these relationships are met and maintained, it will allow the nation to prosper economically and improve its overall standing. Also, apart from the better living standards, it also increases the life expectancy for advancing societies. With the help of a good healthcare service, nations are able to sanction and provide dependable service for their residents. In addition, many governments provide funds and necessary donations for a proper health and education centre for poor societies that cannot afford such things, which led to a significant cutback in the illiteracy rate. Through economic benefits, globalization helped decrease the illiteracy rate worldwide and improved living standards undoubtedly. “About 85% worldwide has a life expectancy of sixty years of age, which is about twice as much as the average life expectancy 100 years ago”, World Bank (2004). Globalization benefits both scientists and doctors to commit to their work and uncover many different treatments and create certain antibodies that will fill help against deadly sicknesses. For example, when HIV, swine flu, birds flu came into awareness. Thru globalization, many organizations and societies came together with one goal of eliminating those harmful epidemics. Imagine if globalization wasn’t made and those previously listed diseases took over the world.

Introducing different cultures has many benefits to society as a whole. Although, thru cultural introduction, many communities have changed immensely in good ways. Before globalization, other people weren’t aware of the vast amounts of different cultures were out there in the world. However, with the service of important gadgets of globalization like; internet, TV news stations, radios, satellites, and many technological advancements. The media has allowed various cultures in advertising and self-representing themselves on a global level. Cultural globalization affects the shared knowledge in which societies learn how to; value the ideas, cope with different principles and improve social relations. Furthermore, people are able to know and understand each other on a world scale. Cultural globalization is a way of distinguishing and preserving a certain culture and customs. There is interlace between cultures in many societies, however day by day when societies are exposed to different traditions, they by habit learn how to better cope with each other.

In conclusion, a system of globalization has intertwined many societies and improved them significantly. Whether long term or short term, the economies of nations have automatically upgraded under the impact of globalization. The size of companies has expanded on a foreign level, opening many job opportunities. Poor societies have made to be better equipped in education and healthcare systems. And lastly, many undermined cultures came into awareness by people all over the world, and many are fascinated and astonished by them immensely. Moreover, globalization is about the adequacy and creating market opportunities. Businesses get through with their partners and manage their dissemination system more efficiently.  

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Is globalization in retreat? Here is what a new study shows

Sebastian franco bedoya.

The debate is raging: Is globalization in retreat or not? If yes, to what extent, and what are the implications for global prosperity and poverty reduction? These aren’t easy questions to answer, largely because there are different definitions of globalization, which give rise to different ways of measuring it. Recent research at the World Bank, based on a new definition, suggests that globalization is alive and well.

But first, some context. For more than 50 years, globalization has been a catalyst for economic development, trade integration, and prosperity building. It has helped lift more than 1 billion people out of poverty. Since the 1990s, it has become a pathway for businesses in emerging economies to enter global value chains and nearly double their share of exports. Breathtaking advances in communications, transportation, and information technology have made it easier and cheaper for countries on opposite sides of the world to transact business, tap into each other’s markets, and share resources, knowhow, and technology. On the other hand, some critics in advanced economies blame globalization for the loss of manufacturing jobs, and others point to it as a source of greenhouse gas emissions.

Recently, the COVID-19 pandemic, the war in Ukraine, and China-US tensions have led countries and companies to rethink global strategies. But to what extent is globalization actually retreating?  Some studies find little systematic evidence that it is, while others conclude that “trade openness” has recently fallen in some regions, coinciding with a slower pace of trade reforms and posing a threat to growth. This isn’t just an academic exercise. Accurately measuring globalization is necessary to understand the impact of the current challenges on the world economy. Economic policy cannot risk either overestimating deglobalization or underestimating the costs of such a scenario. For this reason, we need a clear definition with precise empirical applications that can guide economic policy.

The trade-to-GDP ratio — which calculates the relative importance of a country’s imports and exports to its economy — is one way to measure “openness” to trade  . This ratio steadily rose until 2008, then suffered a sudden drop in 2009 following the global financial crisis. By 2011 it had recovered, but it lacked the same vigor as before the crisis, suggesting to some that globalization was waning.

Some economists continue to the use trade-to-GDP ratio as a measure of openness, although many others argue that it is an inadequate yardstick and doesn’t necessarily imply that high trade barriers exist. Instead, it could reflect factors such as the size or structure of the economy or its geographic proximity to trading partners.

So globalization is better understood as an extension beyond national borders of the same market forces operating at all levels of economic activity. Using this definition, we measured the intensity of globalization as the growth of international trade relative to domestic trade. For instance, automakers sell some cars in the domestic market and export the rest. Comparing the evolution of the exports of cars with domestic sales offers a better measure of globalization dynamics than the trade-to-GDP ratio.  The model used to capture the relative dynamics of international and domestic trade is what economists call a structural gravity model. It allows for comparisons across countries and over time, capturing more intuitive globalization dynamics than the trade-to-GDP ratio. Among other factors, the reduction in trade barriers and advances in information technology make international trade grow faster than domestic trade, with the world becoming more globalized and with greater economic connectivity and cooperation among countries.

Based on this research, there is no evidence that the world economy has entered an era of deglobalization.  China’s trade-to-GDP ratio, for example, has trended downward since 2006 and is now below both the world average and the level in 2001, when China entered the World Trade Organization. Yet even considering recent trade tensions with the United States, it would be difficult to argue that the Chinese economy is drastically less “open,” as the trade-to-GDP ratio would suggest. A better explanation is that trade has become less important to China’s GDP as its domestic economy has boomed.

A globalization analysis consistent with economic theory requires the study of sector-specific dynamics. For instance, manufacturing has traditionally been a more trade-intensive sector, but information and communication technology (ICT) advances seem to be making services more tradable, pointing to more globalization opportunities in the future. Figure 1 plots the main results of our research. It shows that globalization dynamics in manufacturing were already strong in 1965, while agriculture and services “took off” in the late 1970s and 1990s, respectively. There is no sign of a deglobalization trend post-2008.

Figure 1. Globalization took off at various times, depending on the sector and country.

Figure 1 (b) investigates manufacturing dynamics across countries. These results uncover differing dynamics, situating China as a globalization leader starting in the 1980s, outperforming the world economy significantly during the entire period. This story is different from the one told by the trade-to-GDP ratio. Other results also offer deep insights by illustrating how countries like India, while lagging in manufacturing globalization, have outperformed the world economy in services.

The debate on globalization uses various terms --  slowbalization, deglobalization, reglobalization. Each tells a very different story about changes in the world economy. Our research contributes to these debates by offering a globalization toolkit to understand where the world economy stands today  and helping us to prepare for future dynamics.

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