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Globalization is the process of development in politics, economy and culture all around the world.National economies becomes increasingly integrated through globalization.Although globalization brings positive effect on economy, it also affects the world in a negative way.
To start with, globalization has improved interdependence of national economies. Globalization involved free trade, greater competition, and increased investment. Globalization allows companies to enter wider markets and consumers have more options of goods and services.
Free trade is a trade between countries without governmental intervention. Globalization lows greater trade and competition in the market that leads to lower prices, higher economic growth and it also increases level of investment. Since companies open wider markets, they need more people to work for them. Globalization enables a larger job opportunity that leads to decreasing of unemployment. Globalization allows us to move from one to another country. Free movement of labor gives advantages to both sender and recipient countries.
If a nation experiences high unemployment, there are large opportunities to look for jobs somewhere else. Globalization increases Gross Domestic Product (GAP) of a country. GAP is the market value of all final goods and services produced within a country in a given period of time. Production of foreign companies in a country is counted as a part of country’s GAP. A massive increase in education is also result of the globalization process. However, globalization brings negative impacts on a nation. Developing countries have difficulties to compete with developed countries.
Globalization drives migration. So many people with different background move in and out Of a Country. They tend to follow the foreign culture and forget their own culture, this can lead to cultural conflicts. Opening doors to international trade has increased intense competition. Local products often struggle to compete with imported products because imported products are usually cheaper and better. Globalization has increased standard of living. People in recent times tend to buy branded products more than local products. Thereby the local companies suffer huge losses.
Globalization allows workers to move freely. Hence, it is difficult for some countries to hold onto their best skilled workers who are attracted by higher salaries in other countries. Economic bloc or trade bloc is an agreement between countries, to acclimate trade between participants. For example, The European Union (SEC)). The E has 28 members (Austria, Germany, Norway, Belgium, Greece, Poland, Bulgaria, Ireland, Portugal, Cyprus, Italy, Romania, Croatia, Latvia, Spain, Czech Republic, Lithuania, Slovenia, Denmark, Luxembourg, Slovakia, Estonia, Malta, Sweden, Finland, Netherlands, UK and France).
The aim is to promote free trade between countries. Multinational Corporation also knows as transnational corporation, is a corporation that has its assets in several countries but managed from one country such as Coca Cola. Multinational Corporation is beneficial because it creates jobs and improves technology. Business cycle refers to the change of economic activity. Economy experiences ups and downs caused by the changes of supply and demand. The changes of economic growth in the global economy over time are known as international business cycle.
In labor markets, employers compete to hire the best skilled workers, while workers compete to get the best satisfying job. In recent time, more people are moving to different countries to get a better quality of life and standard of living. High skilled workers are attracted to rich Mounties such as the United States because of the higher wages and better opportunities. Small countries often struggle to hold onto their most talented and skilled workers, who are attracted to other countries by greater rewards (Australia in the Global Economy, 2004).
The globalization of labor market has been increasing, however there are still significant difficulties on working in other countries such as language, immigration restrictions, cultural factors, and incompatible educational and professional qualifications. For example, people from Mexico who move to America. 10,000 people cross the Mexican order every week. People usually move to find a job, to avoid war, to find a better quality of life or to be closer to their friends or family.
Those migrants often struggle to live in rural Mexico because they have to survive with very little money; most of the population is living in poverty. The lack of resources makes they live harder to gain money. They believe by moving to America they can get a better life. Rural Mexico doesn’t have minimum wage like in America; what they make in a whole day at Mexico would be few hour work in the USA. Migrants are usually fathers Of big families that have to cross the border, then end home bunches of money or return to their homes.
Some of them move to America in a legal way and some with an illegal way. Those who don’t have valid passport and visa are willing to cross the desert that separates Mexico and America. Many people suffer dehydration when they are crossing and the border patrol may catch them. These migrants bring impacts on both Mexico and America. The impacts on America are local businesses have benefited as they have a source of cheap labor, Mexicans are willing to do anything, and Mexicans have brought their culture and food with them that makes Mexican DOD very popular in the LISA.
However, The LISA government has to spend millions of dollars for border patrols and prisons due to illegal migrants (recently it has been a concern that there may be terrorists crossing the border. ) Mexicans also cause social problems due cultural and racial issues and also many Americans feel that Mexicans are taking their jobs. On the other side, Mexico has less of economically active people; young people tend to migrate and leave the old and the very young. In the final analysis, globalization can benefit people but it can cost people too.
Indonesia been terrorized recently, more jobs are provided so people become wealthier. Quality of life in Indonesia is increasing; the government now has more money to spend because people can afford to buy more expensive things. Globalization is at its peak and it is clear that globalization cannot be stopped.