Globalization is the phenomenon which has eliminated all the barriers to ensure the smooth flow of goods and services. Before we discuss the positive and negative effects of globalization, let’s learn about the process of globalization.
Globalization is the process where people, governments, and organizations across the world interact and integrate through trade and commerce. The effects of globalization are evident on culture, environment, human societies, and economy around the globe.
The significant effects of globalization can be seen in the telecommunication and transportation industries. It is for globalization that you can get services around the world with the click of a button.
The main components which integrate the international market are:
Globalization has enriched the world culturally, scientifically, as well as economically. Economists have predicted the process to eradicate poverty.
Before we discuss the positive and negative effects of globalization on developed and developing countries, it’s crucial to identify the main drive behind globalization. Technology plays a leading role in the rapid boost of globalization over the last few decades.
Due to advanced technology, communication has revolutionized and enhanced connectivity. Technology has helped in improving transportation with modern ships, airplanes, and trains, which has increased trading among nations.
Now let us get into the positive and negative effects of globalization.
Globalization has had a positive and negative impact on the economy of both developed and developing countries. If you are wondering, what are some of the positive effects of globalization, here are some of the positive effects of globalization:
One of the significant positive effects of globalization is the growth in international business. Globalization has led to the formation of multinational companies and investment in other countries with high market competition. Companies got access to a bigger market which in return boosts sales and the money-making process.
Due to globalization, many companies have now moved to areas where the cost of production is cheaper. With low production costs, companies can offer goods to customers at more affordable rates.
Globalization has created more job opportunities in the underdeveloped and developing nations and improved the living standard of people with better wages. Investors around the globe look for opportunities to invest in a country which boosts the economies of both countries.
For instance, if a country is good at making hardware products, they can focus on building the things they are good at and import the other products for cheap from countries that are good at making that particular product.
Every company wants to excel and dominate the market with innovative products of the highest quality standards. Competition from various firms pushes a company to do better and produce a variety of products to its customers.
Globalization has helped create a common goal among the governments. It’s for globalization that the world leaders have come together to fight against global issues.
The list of positive effects of globalization in the current age is inexhaustible. However, there are some negative impacts of globalization which you must know of.
Despite so many positive effects of globalization, there are some negative impacts of globalization as well.
With a rise in production, the utilization of natural resources has also increased. The increased use of fossil fuels is causing a severe threat to the environment and the future of the world.
Countries like China offer products at lower prices which gives tough competition to the companies from the developed nations. Big companies are forced to reduce their rates to withstand market competition.
Many western companies hire labor from underdeveloped and developing countries at a minimum wage plan. They outsource most white-collar and manufacturing jobs leaving the people in the developed countries with few job options.
While some of the challenges are serious and need immediate attention, there is no denying the fact that we live in an interconnected web where every nation is dependent on each other.
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