While free trade aims at attracting more consumers to increase sales turnover and generate more profits, fair trade aims at educating the consumers about the benefits of producing goods without the exploitation of labour or the environment. Thus, fair trade mainly thrives on the demand created by the consumers for such products. Free trade can benefit everyone, the developed and developing world. (Hufbauer, 2008) Free traders believe the best way to lessen poverty in the long run is to permit free trade while fair traders think that opening trade will even further make rich nations becoming richer and poor nations becoming poorer. But there are many ideas on having a managed fair trade which will generally result in sustainable long-term prosperity and equality between
Fair trade and free trade have an unforeseen amount of shared policies. Both groups are concerned with lessening the poverty and increase global success. Free trade is said to take place amongst countries when there are no barriers to trade by governments or international organizations. Goods are able to exchange freely between countries. Small entrepreneurs lack the support and accessibility to gather their resources to produce their goods, so through fair trade these small scale producers will be able to compete against the developing nations and make a sustainable living.
Social globalization describes an exchange of values, ideas and it has facilitated the promotion of equality, dignity and human rights. Finally, the major effect of globalization is produced in the world economy. The aim of globalization is the growth of the global economy by giving firms a superior competitive position with lower cost through free trade and by increasing the number of consumers, products and services. Some people said it helps developing nation-states to “catch up” the industrialized ones and it improves the overall standard of living. Nonetheless, there is a risk for smaller companies that cannot compete in an international market and world governments should promote international investments and try to eliminate barriers to trade even if it causes them some
Monopolistic behaviour by the rich endangers the integrity of a free trade system just as much as punitive import tariffs. Intellectually, free trade has undoubtedly won the argument. In this topic, free trade has a lot of benefits rather than dangerous thing. It all depends on how the government can overcome free trade well, and minimize possible things that could harm a state party. The policies of each country that are in possession must be set well without any fraud.
While other researchers argue that economic globalization gives solutions of trading and poverty that developing countries encounter. In this paper, I will discuss how Economy Globalization is a good trend that brings benefit for the country. The decision of doing economy globalization chosen because it is considered as beneficial for the country. “The economic essence of globalization is actualized in spreading out the most efficient forms of social production, which in technological terms is demonstrated in the speed, cost-cutting, and reliability of production processes.” (Mamedov, 2016). Globalizing the trade to become international wide gives more opportunity for the country to fulfill the demand of the country.
The term globalization refers to the process of the world movement toward economic, financial, trade, and communications integration with free transfer of capital, goods, and services across national frontiers. Globalization not only move people closer but also companies. You can make a call to someone who lives in another part of the world, a click to purchase American products and a word to start business. Behind benefits there is also costs of globalization that not often revealed because the truth is not always what people want to hear. Some country makes them comfortable at the expense of making others miserable.
This means that, at regional level, there is a wider application of the principle of comparative advantage. Market access; easier access to each others markets means that trade between members is likely to increase. Trade creation exists when free trade enables high cost domestic producers to be replaced by lower cost, and more efficient imports. Because low cost imports lead to lower priced imports, there is a consumption effect; which increased demand resulting from lower prices. Economies of scale; producers can benefit from the application of scale of economies which will lead to lower costs and lower prices for consumers.
Because some people argue that globalization help poor countries to become economically good state & make their living standards improve ,while others arguing that the creation of the free market concepts enable developed countries to make more money at the expense of poor countries resources, labour & cultural unbalances. So some part of the world helping globalization concepts & others resisting the concepts of globalizations, Actually most of them trying to see a balance between pros & cons of the globalization for example governments trying to manage the trading concepts based on the governmental objectives by creating new
It could be stated that nations can develop specialization in manufacturing certain products for which they can enjoy a competitive advantage. This is a way to yield profits from trade as it would lead to cheaper rates for consumers, considerable choice related to goods, huge markets related to export for domestic producers, higher contention, and economies of scale by developing specialization in a single sector. Hence, this could be regarded as a main advantage related to economic globalization. Considerable labor movement Escalation in migration of labor from different countries also serves as a benefit to employees as well as recipient nations together. When there is more unemployment in the country, it increases the chance that employees would find work in some other country.
The term ‘trade’ is like a two edged sword.There are many reasons as to why. By trading, it brings in a lot of advantages to the country. International trade brings valuable benefits such as the exploitation of a country’s advantage. It allows trade to encourage a country to specialise in producing goods and products and services in which it can be most efficient and effective and also at the lowest possible cost. Another advantage would be that trade allows the increase in competition and overall lowers the world prices of goods.