Economic globalization
Process of spreading
 refers to increasing economic interdependence of
national economies across the world through a
rapid increase in cross-border movement of
goods, service, technology and capital.
 It is the process of increasing economic
integration between countries, leading to the
emergence of a global marketplace or a single
world market. Depending on the paradigm,
globalization can be viewed as both a positive
and a negative phenomenon.
Economic globalization comprise of the
globalization of :
 production,
 markets,
 competition
 technology
 Corporations and industries.
Whilst economic globalization has been
occurring for the last several thousand years
(since the emergence of trans-national trade), it
has begun to occur at an increased rate over the
last 20-30 years. This recent boom has been
largely accounted by developed economies
integrating with less developed economies, by
means of foreign direct investment, the
reduction of trade barriers, and the
modernization of these developing cultures.
What is Globalization?
There are nearly as many definitions of globalization as
authors who write on the subject. One review, by Scholte,
provides a classification of at least five broad sets of
definitions:4
1) Globalization as internationalization. The “global” in
globalization is viewed “as simply another adjective to
describe cross-border relations between countries.” It
describes the growth in international exchange and
interdependence.
2. Globalization as liberalization. Removing government
imposed restrictions on movements between countries.
3. Globalization as universalization.
ideas and experiences to people at all corners of the earth
so that aspirations and experiences around the world
become harmonized.
4. Globalization as westernization or modernization. The
social structures of modernity (capitalism, industrialism,
etc.) are spread the world over, destroying cultures and
local self-determination in the process.
5. Globalization as deterritorialization. Process of the
“reconfiguration of geography, so that social space is no
longer wholly mapped in terms of territorial places,
territorial distances and territorial borders.”
Although the debates on the definition and importance
of globalization have been vigorous over time, we believe
that the truly relevant policy questions today are about
who benefits and who does not; how the benefits and the
costs of these processes can be shared fairly; how the
opportunities can be maximized by all; and how the risks
can be minimized. In addressing these questions, one can
understand globalization to be a complex set of dynamics
offering many opportunities to better the human
condition, but also involving significant potential threats.
Contemporary globalization manifests itself in various
ways, three of which are of particular relevance to policy-
makers.
They also comprise signify cant environmental
opportunities and risks.
1. Globalization of the economy. The world economy
globalizes as national economies integrate into the
international economy through trade; foreign direct
investment; short-term capital flows; international
movement of workers and people in general; and flows of
technology. This has created new opportunities for many;
but not for all. It has also placed pressures on the global
environment and on natural resources, straining the
capacity of the environment to sustain itself and exposing
human dependence on our environment. A globalized
economy can also produce globalized externalities and
enhance global inequities. Local environmental and
economic decisions can contribute to global
solutions and prosperity, but the environmental costs, as
well as the economic ramifications of our actions, can be
externalized to places and people who are so far away as
to seem invisible.
2. Globalization of knowledge. As economies open up,
more people become involved in the processes of
knowledge integration and the deepening of non-market
connections, including flows of information, culture,
ideology and technology. New technologies can solve old
problems, but they can also create new ones.
Technologies of environmental care can move across
boundaries quicker, but so can technologies of
environmental extraction. Information flows can connect
workers and citizens across boundaries and oceans (e.g.,
the rise of global social movements as well as of
outsourcing), but they can also threaten social and
economic networks at the local level. Environmentalism
as a norm has become truly global, but so has mass
consumerism.
3. Globalization of governance. Globalization places great
stress on existing patterns of global governance with the
shrinking of both time and space; the expanding role of
non-state actors; and the increasingly complex inter-state
interactions. The global nature of the environment
demands global environmental governance, and indeed a
worldwide infrastructure of international
agreements and institutions has emerged and continues
to grow. But many of today’s global environmental
problems have outgrown the governance systems
designed to solve them. Many of these institutions,
however, struggle as they have to respond to an ever-
increasing set of global challenges while remaining
constrained by institutional design principles inherited
from an earlier, more state-centric world. The relationship
between the environment and globalization— although
often overlooked—is critical to both domains.
Pros of Globalization
 With globalization, there is a global market for
companies to trade their products and a wider
range of options for people, to choose from
among the products of different nations.
 Developing countries benefit a lot from
globalization, as there is a sound flow of money
and thus, a decrease in the currency difference.
 To meet the increasing demands that follow
globalization, there is an increase in the
production sector. This gives loads of options to
the manufacturers as well.
 Competition keeps prices relatively low, and as a
result, inflation is less likely to occur.
 The focus is diverted and segregated among all
the nations. No country remains the single power
head; instead there are compartmentalized
power sectors. The decisions at higher levels are
meant for the people at large.
 Communication among the countries is on the
rise, which allows for better understanding and
broader vision.
 As communication increases amongst two
countries, there is interchange of cultures as well.
We get to know more about the other's cultural
preferences.
 As we feed to each other's financial needs, the
ecological imbalance is also meted out.
Governments of countries show concern about
each other.
Cons Of Globalization
 Globalization is causing Europeans to lose their
jobs as work is being outsourced to the Asian
countries. The cost of labor in the Asian countries
is low as compared to other countries.
 The high rate of profit for the companies, in Asia,
has resulted in a pressure on the employed
Europeans, who are always under the threat of
the business being outsourced.
 Companies are as opening their counterparts in
other countries. This results in transferring the
quality of their product to other countries,
thereby increasing the chances of depreciation in
terms of quality.
 There are experts who believe that globalization
is the cause for the invasion of communicable
diseases and social degeneration in countries.
 The threat that the corporate would rule the
world is on high, as there is a lot of money
invested by them.
 It is often argued that poor countries are
exploited by the richer countries where the work
force is taken advantage of and low wages are
implemented.
Globalization means increasing the interdependence,
connectivity and integration on a global level with respect
to the social, cultural, political, technological, economic
and ecological levels.
Advantages of Globalization
- Goods and people are transported with more easiness
and speed
- The possibility of war between the developed countries
decreases
- Free trade between countries increases
- Global mass media connects all the people in the world
- As the cultural barriers reduce, the global village dream
becomes more realistic
 o there is a o the standards applied globally like patents,
propagation of copyright laws and world trade agreements
democratic ideals increase
o the
interdependence o corporate, national and subnational borrowers
of the nation-states have a better access to external finance
increases
o worldwide financial markets emerge
o as the liquidity of
o multiculturalism spreads as there is individual
capital increases,
access to cultural diversity. This diversity
developed
decreases due to hybridization or assimilation
countries can
invest in o international travel and tourism increases
developing ones
o worldwide sporting events like the Olympic
o the flexibility of Games and the FIFA World Cup are held
corporations to
operate across o enhancement in worldwide fads and pop
borders increases culture

o the communication o local consumer products are exported to other

between the countries
individuals and
corporations in the o immigration between countries increases
world increases
o cross-cultural contacts grow and cultural
o environmental diffusion takes place
protection in
o there is an increase in the desire to use foreign
developed
ideas and products, adopt new practices and
countries increases
technologies and be a part of world culture
Effects of globalization o free trade zones are formed having less or no
o enhancement in the information flow between tariffs
geographically remote locations
o the global common market has a freedom of o due to development of containerization for
exchange of goods and capital ocean shipping, the transportation costs are
reduced
o there is a broad access to a range of goods for
consumers and companies o subsidies for local businesses decrease

o worldwide production markets emerge o capital controls reduce or vanquish

o free circulation of people of different nations o there is supranational recognition of intellectual

leads to social benefits property restrictions i.e. patents authorized by
one country are recognized in another
o global environmental problems like cross-
boundary pollution, over fishing on oceans, Advantages of globalization in the developing world
climate changes are solved by discussions It is claimed that globalization increases the economic
prosperity and opportunity in the developing world.
o more trans-border data flow using
The civil liberties are enhanced and there is a more
communication satellites, the Internet, wireless
efficient use of resources. All the countries involved in
telephones etc.
the free trade are at a profit. As a result, there are
o international criminal courts and international lower prices, more employment and a better standard
justice movements are launched of life in these developing nations. It is feared that
some developing regions progress at the expense of
other developed regions. However, such doubts are
futile as globalization is a positive-sum chance in
which the skills and technologies enable to increase
the living standards throughout the world. Liberals
look at globalization as an efficient tool to eliminate
penury and allow the poor people a firm foothold in
the global economy. In two decades from 1981 to
2001, the number of people surviving on $1 or less
per day decreased from 1.5 billion to 1.1 billion.
Simultaneously, the world population also increased.
Thus, the percentage of such people decreased from
40% to 20% in such developing countries