Industrialisation allowed production of common goods using economies of scale and tremendous population growth created a healthy demand for commodities. The core element for globalisations existence is the expansion of world trade through eradicating or reducing trade obstruction such as import tariffs. The higher the import, the consumer is offered a wider variety of goods at a relatively reduced price. This in turn increases and strengthens the power of the domestic industries to be a part of the race. To increase a country’s economic growth exports play a very vitol role.
The developing countries have achieved this progress by reforming their policies, institutions, and infrastructure. The existing market structure, the market potential and the expected increasing returns are the leading criteria for firms for investment. With the growing global competition, the world economy provides a large source of supply and demand, so that international trade increases the possibilities for an adequate through specialization and complementary strategies. Economies of location can be seen as a prominent factor in globalization of industries. The transnational co-operations (TNC) are important market players in world trading system.
Globalization is the result of great changes in political, economic, technological and social areas. Trade and direct investment helps developing countries to confront the international competition by boosting their economy, increasing productivity and export capacity. Direct investment reflects positively to one-time balance sheet of the host country (Prof. Dr. Ahmet Incekara, 2012). Globalization is the tendency of investment funds and businesses to move beyond domestic and national markets to other markets around the globe, allowing them to become interconnected with different markets. Proponents of globalization say it helps developing nations “catch up” to industrialized nations much faster, through increased employment and technological advances and Asian economies are often highlighted (Pologeorgis, 2010).
A country must also have a competitive edge in the international market the process of increasing economic integration between countries, leading to the emergence of a global marketplace or a single world market. Depending on the paradigm, economic globalization can be viewed as either a positive or a negative phenomenon. Economic globalization comprises the globalization of production and Globalization markets in my opinion had a positive impact on the world economy
Globalization refers to the increasingly global relationships of culture, people, and economic activity. It is generally used to refer to economic globalization. For instant, the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import quotas. Moreover, global business will be characterized similarly as corporate alternately investment movement that takes spot crosswise over distinctive nations (Williams,2010). However, there are significant relationship between globalisation and global business.
Because of the Globalization-which means there are much more trade between different countries than before-plenty of countries will be affected by one country if there is inequality of financial expenses and income. For example, the freight crisis in Thailand had expanded quickly to the Southeast Asia and Japan, and even spread to the Russia and Latin America, which makes world economy unstable eventually. What is more, globalization has already exacerbated the gap between rich and poor. Globalization creates efficiency by competition, but the wealth is concentrated to a small group of companies and people because of the unequal distribution of profit between different countries. The developed countries have the higher status of globalization-as the owner of most of advanced technology and capital, so they have the dominance of international finance like price setting.
Rich and industrialized countries are magnets for labor migration, with development of globalization it is becoming more easily to access for working in these countries. The local conditions for workers in their countries are also important. Because as causes of labor movements there are push and pull factors. Push factors are about origin country, such as overpopulation, few jobs, low wages, political problems. Pull factors are about destination country, such as more and better jobs, higher wages, “better life.” Globalization also means moving internationally more easily which is accelerate factors for labor migration.
The indicators of globalization Globalization is the process of increasing interaction and interdependence between societies, economies and nations across large distances. The term globalization not only refers to the movement of goods and services across countries and that consumption has been internationalized through cross-border trade, production has been also internationalized by foreign direct investment. Globalization sometimes can be good and sometimes can be bad. Its effect differs from one country to another. Globalization participates in the increasing power of multinationals all over the world in addition to worldwide spreading of human rights and knowledge.
Globalization is the development of worldwide economy in which resources and products move fairly across national borders. It is also a process of integration among people, companies, and governments of different countries, which is usually driven by international trade, investment and aided by information technology. Both developed and developing countries are taking part actively in globalization process but both countries reacted differently in globalization. This process has the positive and negative effects on employment, culture, education and knowledge, market competition, economic, wealth and human physical well-being in societies around the world. Employment and Poverty The outsourcing of services and manufacturing to developing countries have provided more job
Also, if we are able to further level the playing field by implementing balanced standards of international trade, it would alleviate some of the trade disagreements and controversies. Furthermore, the advantages of international business are weighty, including the significantly more efficient production of goods and the provision of goods at better quality, quantity, and prices. So, while we must take into account the disadvantages of foreign trade, with careful planning and judicious use of trade restrictions, the benefits will blossom and the entire world will be able to prosper through this incredible worldwide