This refers to the integration of “the domestic economies with the world and the inevitable consequential increase in economic interdependence of the countries through trade, financial and investment flows, freer factor movements and exchange of technology and information.” (Ogbabu & Ameh, 2012, p.49). This demonstrates how countries are coming together as one big economy, in order to make trading globally much easier. It builds up economic efficiency, creates jobs, and lowers consumer prices, increases choice and economic transfer’s functions. “Using
The integration of the world economy is offering many possibilities for corporations to expand globally and more gradually than ever. The importance of cost minimization and the existence of global trans-ocean supply chains gave the opportunity to manufacturing firms to outsource value- creating activities to distant locations that offer huge advantages, as Frankel (2000) indicated. These advantages, according to Kumar (2001), arise from a combination of cost and value advantage. Part of internationalization strategies that firms tend to follow is outsourcing their manufacturing activities to locations where costs are reduced compared to western countries and economies of the world. This process allows for a less path-dependent approach through
Emerging economies are fast becoming significant consumer markets for global businesses and locations for manufacturing production, where production facilities closer to demand improves speed and reduce costs and wastes. Advances in technologies (information, production, transportation) have greatly increased the mobility of goods, services, labor, technology and capital throughout the world and have had profound effects on emerging
IFRS includes high quality international principles of accounts that are easily understood, transparent, can be implemented and are thoroughly applied, (Shekhar and R.A., 2013). As a result, IFRS is a sign of globalization and also a technology through which globalization is organized, (Alfredson et al, 2005). IFRS is a common international accounting language for business activities so that the financial reports of a company can be easily understood and compared across the world. They are a result of increasing global trade and shareholding and are specifically designed for businesses that operate in many countries across the world, (Shekhar and R.A., 2013). The advantages of using IFRS system includes reduction in the capital cost of a firm, increasing efficiency in resource allocation, increased flexibility of capital, uniform and easy comparability of the financial reports of the companies and decline in the options for earnings management.
In other words, it is the process by which countries develop in terms of economic, cultural, political relation with other countries and start operating on an international scale. Increasingly used since the late 19th century and early 20th century, globalization has created enormous changes in all dimensions of human life including both positive and negative sides. First of all, Bill Gates’ s saying goes that “This is a very exciting time in the world of information. It 's not just that the personal computer has come along as a great tool. The whole pace of business is moving faster.
This has allowed for increased trade, migration and investment. As a result, there is an increment in international labor mobility which has brought about diverse labor originating from different backgrounds (Hurn, 2014), and easier access to consumer markets and distribution networks (Choy, 2007). Global integration thus effected constant change of the macro-environment, creating a persistent environmental uncertainty. With globalization, there is intensified economic competition on a worldwide scale. Corporations have to conduct their operations more viably and feasibly in order to not lose out to their competitors.
Globalization and Nation States Globalization has integrated and intertwined the economies of the world. In the world today, every nation has become independent on every other nation, be it through trade or through finance. Developing countries today are attracting large rounds of foreign investment, and this foreign investment is coming from the developed countries. Thus, the money of the developed countries is today invested in the developing countries. At the same time, the world has also become interdependent due to trade relations.
Nowadays globalization, it impacts the world economics. Globalization is the process of increasing the connectivity and interdependence of the world's markets and businesses. The increase of trade around the word is growing up. Globalization affects jobs and income. Most of companies that successful in the world use the strong strategy and strong marketing to getting the goal.
Is globalization ending? The Cambridge Dictionary defines globalization as «the process by which particular goods and services, or social and cultural influences, gradually become similar in all parts of the world». One of the key processes in the development of the global economy at the turn of the XX-XXI centuries is the progressive globalization. Globalization is an inevitable phenomenon in the history of human-being , that the world, as a result of the exchange of goods and products, information, knowledge and cultural values, becomes more interconnected. However, over the past decades, the pace of this global integration has become much higher and more impressive thanks to unprecedented achievements in such areas as technology, communications,
SMEs are dynamic, flexible and have a significant role in job creation. Due to economic internationalization and process of globalization, SMEs are faced with international competition and pushed to compete in international markets. An increasing number of SMEs are aiming to take advantage of new conditions and starting to enter new markets (Daszkiewicz & Wach, 2012). The contributions of SMEs to country’s economic growth makes the study on the internationalization of SMEs very popular among researchers. There are many studies conducted on SMEs internationalization from various perspectives and among them are the process of internationalization, factors for internationalization and barriers to internationalization.