College Papers

Globalization in literal sense

Globalization in literal sense, is international integration. It denotes interdependence and mounted slogans like ‘Death of distance’. The term Globalization used to refer economic globalization, which is the integration of national economies into the international through trade, foreign direct investments(FDI), MNC’s, Capital flows, migration and spread of technology. (Bhagwati 2007) (Singh 2008). Globalization has reduced the sense of isolation felt in much of the developing world and has helped many countries grow far more quickly than they would otherwise have done. International trade helps economic development when a country’s exports derive its economic growth. (Stiglitz 2002). Despite belief that globalization enhances the international connectivity, peace and security by increasing free trade and reducing cultural boundaries. While some people including me believe that it is growing unemployment because companies move to new places where they can get cheaper workers, over standardising of products with global branding such as Emirates Airlines etc. and increasing financial crises in developing countries when investors turn their back in time of need. Thus, given statement comes true:
“While promoters of globalization proclaim that this model is the rising tide that will lift all boats, citizen movements find that it is instead lifting only yachts.”
—International Forum on Globalization
Political economists have long debated the risks and insecurities that economic globalization poses for workers and producers. There are plenty of reasons to expect trade, financial and direct investment and immigration to inspire significant insecurities for those tied to sectors such as globalization and for economies generally. First, trade, investment and immigration -that is, imports plus exports, financial in- and out-flows, FDI in- and out flows and immigration as a share of production or population – should increase insecurities and objective risks in countries facing such globalization. We can expect such insecurity for two reasons: because of the inter-industry component of such demand that may lower the levels of demand for less-skilled labor; and because any kind of international trade and investment (both intra- and inter-industry) will tend to increase the elasticity of labor demand for all skill levels, Such insecurity implies insecure and volatile wages, non-wage benefits and employment – regardless of the industrial relations in which benefits are negotiated and even if economy-wide, long-term effects are modest. In addition, adjustment costs associated with job-switching across sectors may significantly increase costs of openness in short-term calculations of job security and income even among those expected to gain in the long run (Davidson and Matusz, 2004).