Paper Example on Exploring Globalization: Benefits & Drawbacks

Discuss the Benefits and Drawbacks of Globalization

Globalization is the process of integration and interaction on an international scale among companies, people and governments. Globalization process contains both benefits and drawbacks. Globalization has always been viewed as the potential practice that makes the world a better place to live in. The developing countries feature Globalization as a tool that helps them solve deep-seated problems like poverty and unemployment. Many developing countries have taken Globalization as a good thing since they have access to the international market and can export cheap goods. Globalization has been good for both Wallet Street and Multi-national corporations. Most working people are highly disadvantaged by the process of Globalization since it has resulted in continued deindustrialization, for instance, in America. General observation shows that the major criticism about Globalization is that it has made the affluent more affluent and the underprivileged become poorer. It is hell on nature and workers while it is a wonderful practice among the investors, managers and owners. A wave of Globalization is believed to drive any industrial revolution. Globalization has both advantages and disadvantages in its operation. Globalization is such a complex issue, and it is essential to give a concrete evaluation of its advantages and shortcomings before drawing any conclusion.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

Benefits of Globalization

There are various benefits that are associated with Globalization in the economic world. It encourages both consumers and producers to achieve benefits from economies of scale and division of labor. Increase in income capital assisting most of the poorest countries to acquire faster economic growth.

Increased International Trade

Globalization has a lot of impact on international trade. It has resulted in interconnectedness in the world markets, created awareness of business opportunities and increased communication in all corners of the globe. There are more investment opportunities for millions of investors who are now able to study new investment markets than before (Erixon, 2018). Due to improved communications technology, profit opportunities are easier to reach in international trade. The services and products that were initially available in one country can be accessed internationally through the help of globalization. Countries which are in good terms increase trade and investment through unifying their economies.

Globalization has a positive impact on international trade by maintaining competitiveness. It is highly associated with the increased competition where most of the companies tend to broaden or expand the home countries and local areas to the rest of the world. Since some of the countries face strong competition from other outside countries, they are forced to outsource labor and raw materials from the outside countries (Erixon, 2018). The act of Globalization on international trade was as a result of outsourcing and sourcing practices which converted several companies into a global figure as they worked towards seeking partners and production locations for the new ventures. Globalization is the factor that has made global markets transition easier.

Technological Innovation

Global trade requires well-advanced systems that are capable of facilitating trade. Globalization allows for the creation of better systems that can be used to track international trade. Enterprise resource planning is among the best systems that provide the best solutions for supporting global trade. EPR process helps the integration parts in the business and its management information system is highly important in various areas that require integration such as inventory, planning, marketing, purchasing, human resource and finance (Kuepper, 2020). EPR is such an important technological innovation that has aided in global trade, enabling more efficient environment in trading. Technology is an important tool in global trade that empowers efficiency by reducing time and cost. Technology innovation makes the production process more efficient as a result of Globalization since most of the companies are working towards maintaining their competitive advantage.

Growth in Countries Open Trade

Globalization has contributed positively towards the growth in countries open trade. Trade is regarded as the central factor to end any global poverty. Countries that mainly open to international trade tend to grow faster economic wise. These countries can improve productivity, innovate and provide higher income through the process of globalization. Lower-income households also tend to benefit from open trade since the consumers are offered with more affordable goods and services (Kuepper, 2020). International open trade integrates the world economy by global value chains and trade, which helps in reducing poverty and boosting economic growth both globally and locally. Through Globalization international trade has been made easier across the borders for instance countries like Macedonia, Bosnia and Herzegovina have facilitated logistics services by making them more reliable and streamlining procedures in order to clear customs across the country borders. Such projects facilitate the global trading systems by making them more open, predictable and reliable for people around the world.

Poverty Reduction

Economic growth is the main aspect of the world through which Globalization can have an impact on poverty. Research clearly shows that when most of the developing countries forget about protectionism and embrace open trade, they grow fast increasing their living standards. The poor have largely benefited from Globalization since it has the power to decline poverty and boost economic growth among people (Erixon, 2018). It results in an increase in employment opportunities; hence people can earn their living easily and upgrade their standards of living. The impact of Globalization on poverty reduction has become the central focus of attention in international organizations and the governments.

The economic aspect in relation to Globalization stresses positive impacts of investment and international trade to accelerate innovation, increase living standards, create new economic opportunities, promote the diffusion of management and technological skills which eradicate poverty. Globalization benefits are not equally distributed in all the countries in the whole world since there some that are very advanced and others are poorest (Erixon, 2018). Facilitation of free trade in developing countries enhances the eradication of poverty. Globalization has resulted in an increase in vulnerability in many countries introducing them to international economic conditions.

The central focus by international and national organizations on poverty alleviation has displayed a clear picture of determinants, magnitude and nature to create all possible routes that would reduce poverty. Globalization has increased access to water, health, information, and education, among others in poor countries, reducing the poverty aspect. The developing countries are at the advantage since they are given the main responsibilities in harnessing potential benefits of Globalization which help in countering any negative effects (Erixon, 2018). Due to this, countries are urged to adopt social and structural measures that are appropriate in order to promote macro-economic stability which eradicates poverty and boost economic growth. High-income countries are encouraged to support various initiatives by increased aid, relief and debts. Globalization has increasingly reduced poverty all over the world.

Employment Generation

Globalization plays a major role in employment generation. Economic Globalization has an impact on the creation of employment in the economy. The impact is mainly based on a different microeconomic level such as enterprise, economic activity and establishment. The number of jobs increases with Globalization through the creation of new opportunities (Erixon, 2018). Higher productivity and higher consumption demand need more people employed to offer effective services in economic globalization. Structures of jobs are affected by economic Globalization since they are distributed across various economic activities. Technological progress tends to create more structure of jobs through increased qualifications and engagement in service-oriented activities.

Drawbacks of Globalization

The drawbacks of Globalization are mainly associated with the growth of inequalities, change of negative climate impact, rising unemployment, among others. The dramatic increase in levels of influx refugees and immigrants has resulted in new problems and pressure to most communities and governments all over the world. Technology explosion has also resulted in the displacement of many workers increasing the rate of unemployment. Many tasks in the industry were automated as a result of increased technological innovation. Globalization has brought about adverse effects where only a few get t benefit. Various challenges faced by most of the countries such as terrorism, climate change, conflict and poverty called for global because there is no country that is capable of dealing with the issues, therefore. The act of global cooperation is likely to pose a threat to the prosperity and peace of a country.

Job losses in Domestic Markets

Globalization has resulted in job losses in domestic markets. Current researches show that import-competing industries have registered 40% job losses in manufacturing industries between the years 1979-2001 (Rodrik, 2018). Most of these jobs are trade-related since trade is a great requirement that is used to move forward the equitable path of international economic integration. Increase in International competition in most sectors over the world makes most companies work towards reducing operation costs; hence workers experience job losses (Rodrik, 2018). The gradual internationalization and diversification of shareholders have made most countries to be reduced to local foothold hence creating worry and uncertainty among the workers in the developed countries. The workers are at risk of losing jobs since the companies are constantly at risk of changing geographical location, making many workers lose the job.

Crisis of job losses due to Globalization have been there for decades. Globalization has increased devastating effects on jobs wherein most of the country's domestic markets, and employment issues are rarely considered. Over the years, the jobs losses have been increasing in the domestic market with an increase in Globalization practices as it involves several phenomena such as international trade among others. Globalization tends to destroy some jobs while creating others. In this context, it is blamed to rob workers their jobs. Some jobs that are lost in certain sectors are found elsewhere creating unemployment from where they are terminated. Job losses are also as a result of competing goods from countries that are emerging.

Increased Pollution

Globalization has resulted in vast channels of development, innovation and improved communication, which has ushered a new era in economic prosperity. Globalization has had an impact on the environment, creating various debates on environmentalism (Shahbaz, Mahalik, Shahzad and Hammoudeh, 2019). Increase in products as a result of increased consumption of goods has resulted in the environment being stressed. Transportation of raw materials from one place to another has rapidly increased with globalization. Initially, peop...