Globalization

Globalization is an elimination of barriers to trade, communication, and cultural

exchange. The theory behind globalization is that worldwide openness will
promote the inherent wealth of all nations.

The good side of globalization is also about easy credit and rising leverage, as money
flows easily across local and national boundaries, and creditors fail to distinguish
between good and bad borrowers, boosting aggregate demand; setting the world
economy into a virtuous cycle of income and employment growth; and easy credit
and leverage fuel financial bubbles that feed into a euphoria that perpetuates the
virtuous cycle.
The bad side of globalization is all about the new risks and uncertainties brought
about by the high degree of integration of domestic and local markets, intensification
of competition, high degree of imitation, price and profit swings, and business and
product destruction. Corporations that previously have been enjoying the benefits of
globalization, now face unstable and unpredictable demand and business
opportunities and their products quickly become commodities, leaving them little or
no pricing power and under constant pressure by new competitors that undermine
profitability.
The positive side of globalization

Globalization has a positive side as well. Supporters of globalization argue that it has the
potential to make this world a better place to live in and solve some deep-seated problems
like unemployment and poverty. The marginal are getting a chance to exhibit in the world
market.

Here are some other arguments for globalization:

1. The proponents of global free trade say that it promotes global economic growth, creates
jobs, makes companies more competitive, and lowers prices for consumers. It also provides
poor countries, through infusions of foreign capital and technology, with the chance to
develop economically and by spreading prosperity creates the conditions in which
democracy and respect for human rights may flourish.

2. According to libertarians, globalization will help us to raise the global economy only when
the involved power blocks have mutual trust and respect for each other’s opinion.
Globalization and democracy should go hand-in-hand. It should be pure business with no
colonialist designs.

3. Now there is a worldwide market for companies and consumers to access products from
different countries.
4. There is a world power that is being created gradually, instead of compartmentalized
power sectors. Politics are merging and decisions that are being made are actually beneficial
for people all over the world.

5 There is more influx of information between two countries.

6. There is cultural intermingling. Each country is learning more about other cultures.

7. Since we share financial interests, corporations and governments are trying to sort out
ecological problems for each other.

8. Socially we have become more open and tolerant towards each other, and people who
live in the other part of the world are not considered aliens.

9. Most people see speedy travel, mass communications and quick dissemination of
information through the Internet as benefits of globalization.

The disadvantages of globalization

1. “The general complaint about globalization is that it has made the rich richer while making
the non-rich poorer. It is wonderful for managers and investors, but hell on workers and
nature.”1

2. Multinational corporations are accused of social injustice, unfair working conditions

(including slave labor wages and poor living and working conditions), as well as a lack of
concern for the environment, mismanagement of natural resources, and ecological damage.

3. Multinational corporations which were previously restricted to commercial activities are

increasingly influencing political decisions. Many think there is a threat of corporations ruling
the world because they are gaining power due to globalization.

4. Opponents say globalization makes it easier for rich companies to act with less
accountability. They also claim that countries’ individual cultures are becoming overpowered
by Americanization.

5. Anti-globalists also claim that globalization is not working for the majority of the world.
During the most recent period of rapid growth in global trade and investment, 1960 to 1998,
inequality worsened both internationally and within countries. The UN Development Program
reports that the richest 20 percent of the world's population consume 86 percent of the
world's resources, while the poorest 80 percent consume just 14 percent.

6. Some experts think that globalization is also leading to the incursion of communicable
diseases. Deadly diseases like HIV/AIDS are being spread by travelers to the remotest
corners of the globe.
7. Globalization has led to exploitation of labor. Prisoners and child workers are used to work
in inhumane conditions. Safety standards are ignored to produce cheap goods. There is also
an increase in human trafficking.

8. Social welfare schemes or “safety nets” are under great pressure in developed countries
because of deficits and other economic ramifications of globalization.

2. How does globalization affect women?

Many critics fear that globalization, in the sense of integration of a country into
world society, will exacerbate gender inequality. It may harm women-especially
in the South--in several ways:

 Economically, through discrimination in favor of male workers,

marginalization of women in unpaid or informal labor, exploitation of
women in low-wage sweatshop settings, and/or impoverishment though
loss of traditional sources of income.
 Politically, through exclusion from the domestic political process and loss
of control to global pressures.
 Culturally, through loss of identity and autonomy to a hegemonic global
culture.

At the same time, many women's advocates recognize that globalization affects
different groups of women in different ways, creates new standards for the
treatment of women, and helps women's groups to mobilize. In situations where
women have been historically repressed or discriminated under a patriarchal
division of labor, some features of globalization may have liberating
consequences. While in many countries women remain at a significant
disadvantage, the precise role of globalization in causing or perpetuating that
condition is in dispute.

3. Does globalization cause poverty?

Many people who are concerned about the fate of the world's poor now attribute
their plight to globalization. They argue that globalization has weakened the
position of poor countries and exposed poor people to harmful competition. Their
concern is understandable, especially since the gap between rich and poor has
indeed become more glaring in recent decades. However, proving a direct link
between economic globalization and poverty is a complex task for several
reasons:

Globalization as a single cause. Specifying how globalization affects the

economic status of countries or individuals is not easy. The effects of
"globalization" may be due to competition among workers, or foreign
investment, or trade, or government borrowing. There is no single measure of
integration into the world economy. Each aspect of integration can have variable
effects.
Poverty as a multidimensional phenomenon. Poverty can be measured
in different ways-for example, relative to a country's average, by consumption
capacity, or in terms of overall well-being. Many people in many places
historically have been poor for many reasons. Attributing (increases in) poverty
to globalization therefore requires proving that globalization has become a
dominant factor in producing a new kind of poverty.

Globalization and overall global poverty. By common consent,

globalization has proceeded rapidly since the 1980s. Yet according to the recent
Global Poverty Report, the proportion of the world population living in poverty
has declined from 29% in 1988 to 26% in 1998. Moreover, social indicators for
many poor countries also show improvement over several decades.

Globalization and poverty in specific countries. If globalization causes

poverty, then countries that become more economically integrated via trade and
investment should do worse. But some that have become more integrated into
the world economy, such as China, have made progress. Others, for example in
sub-Saharan Africa, that have remained relatively isolated have experienced
declines. Such overall differences do not settle the issue, since many other
factors may be at work, but they do cast some doubt on the overall argument.

6. Can globalization be controlled?

The issue of controlling or regulating globalization concerns elite officials of

states and intergovernmental organizations as well as opponents of neoliberalism
in pursuit of global justice. They often share a sense that the current thrust of
globalization may be irreversible and out of anyone's control. They have several
good reasons to think so:

 one of globalization's driving forces, technological innovation, is inherently

unpredictable
 globalization results from the interplay of many parties (economic and
political), none of which exerts dominant influence
 old regulatory agencies devised by states cannot control processes that
exceed their territorial authority
 apart from minimal rules of competition itself, the world lacks a single set
of rules that serves to regulate transnational behavior

This concern has given rise to a now-fashionable interest in "global governance,"

or the design of institutions that authoritatively manage and regulate actions,
processes, and problems of global scope or effect. While some believe such
governance is desirable but lacking, others think it is in fact emerging in the
work of various international organizations and groups active in civil society.
Though advocates of global governance portray it as enhancing democracy,
defenders of traditional democratic values and state interests have questioned
such claims.