Globalization and Modernization
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Globalization refers to the increasing integration of economies and societies around the world through increased trade and cultural exchange. The document discusses both the positive and negative impacts of globalization. It provides causes and effects of globalization on economies, governments, businesses, and individuals. While globalization has increased trade and job opportunities, it has also led to issues like unemployment in some countries, increased environmental damage, and unequal impacts across societies.
Globalization and Modernization
- 2. Globalization: Good or Bad?
- 3. Let’s Try
- 18. Contd. • Globalization is a consequence of increase trade across nations. • Anthony Giddens (1990) describes globalization as “the intensifications of worldwide social relations which link distinct localities in such a way that local happenings are shaped by events occurring miles away.”
- 19. 1.Globalisation is the new buzzword that has come to dominate the world since the nineties of the last century with the end of the cold war and the break-up of the former Soviet Union.
- 20. 2. The term implies worldly integration/amalgamation of various cultures, styles, economic policies, ideas, etc.
- 21. 3. It must not be confused with “making things common around the world”. It is an integration, not simulation.
- 22. Types of Globalisation 1. Economic Countries that trade with many others and have few trade barriers are economically globalised. 2. Social A measure of how easily information and ideas pass between people in their own country and between different countries (includes access to internet and social media networks). 3.Political The amount of political cooperation there is between countries.
- 23. Causes of Globalisation: 1. Improved Communications • The development of communicationtechnologiessuch as internet, emailand mobile phones have been vital to thegrowth of globalisation because they help MNCs to operate throughoutthe world. • The development of satelliteTV channelssuch as Sky and CNN have also provided worldwide marketingavenues for the concept and products of globalisation.
- 24. Causes of Globalisation 2. Improved Transport • The development of refrigerated and container transport, bulk shipping and improved air transport has allowed the easy mass movementof goods throughout the world. This assists globalisation.
- 25. Causes of Globalisation: 3. Free Trade Agreements • MNCs and rich capitalist countries have always promoted globalfree trade as a way of increasing theirown wealthand influence.• Internationalorganisations such as the World Trade Organisation and theIMF also promote freetrade.
- 26. Causes of Globalisation: 4. Global Banking • Modern communicationtechnologiesallow vast amountsof capital to flow freely and instantlythroughoutthe world. • The equivalentof up to $US1.3 trillion is traded each day through internationalstock exchangesin cities such as New York, London and Tokyo.
- 27. Causes of Globalisation: 5. The Growth of MNCs • The rapid growth of big MNCs such as Microsoft, McDonalds and Nike is a cause as wellas a consequence of globalisation. • The investmentof MNCs in farms, minesand factories across the world is a major part of globalisation. • Globalisation allows MNCs to produce goods and services and to sellproducts on a massivescale throughout theworld.
- 29. The Effects of Globalisation: 1. Changed Food Supply •Food supply is no longer tied to the seasons. We can buy food anywhere in the world at any time of the year.
- 30. The Effects of Globalisation: 2. Division of Labour • Because MNCs search for the cheapest locations to manufacture and assemble components, production processes may be moved from developed to developing countries where costs are lower.
- 31. The Effects of Globalisation: 3. Less Job Security •In the global economy jobs are becoming more temporary and insecure. • A survey of American workers showed that people now hold seven to ten jobs over their working life.
- 32. The Effects of Globalisation: 4. Damage to the Environment •More trade means more transport which uses more fossil fuels and causes pollution. • Climate change is a serious threat to our future.
- 33. The Effects of Globalisation: 5. Cultural Impact •Websites such as YouTube connect people across the planet. As the world becomes more unified, diverse cultures are being ignored. MNCs can create a monoculture as they remove local competition and thereby force local firms to close. Replacing
- 34. The Effects of Globalisation 6. Increase in anti-Globalisation Protests • There is a growing awareness of the negative impacts of globalisation. People have begun to realise that globalisation can be challenged by communities supporting each other in business and society and through public protest and political lobbying.
- 35. Impact on the Government Positive effects • Increased economic development • Expanded infrastructure • Transfer of modern management techniques • Greater interdependence among business partners o Negative effects MNC power increased MNCs externalize cost to countries Competition results in too many concessions MNCs influence local policies Companies incorporate in low tax countries Pressure to reduce social benefits
- 36. • Positive effects • Increased job opportunities • Upgraded education system • Increased training Negative effects Job displacement Loss of industries or economic groups Lowered labor standards Downward wage pressure Decreased union power Diminished social contract
- 38. Consumers also profit from globalization. Products become cheaper and you can get new goods more quickly. Globalization let countries do what they can do best. If, for example, you buy cheap steel from another country you don’t have to make your own steel. You can focus on computers or other things. Globalization gives you a larger market. You can sell more goods and make more money. You cancreate more jobs.
- 39. Globalization causes unemployment in industrialized countries because firms move their factories to places where they can get cheaper workers. Globalization may lead to more environmental problems. A company may want to build factories in other countries because environmental laws are not as strict as they are at home. Poor countries in the Third World may have to cut down more trees so that they can sell wood to richer countries.
- 40. Globalization can lead to financial problems . In the 1970s and 80s countries like Mexico, Thailand, Indonesia or Brazil got a lot of money from investors who hoped they could build up new businesses there. These new companies often didn’t work, so they had to close down and investors pulled out their money. Some of the poorest countries in the world, especially in Africa, may get even poorer. Their population is not as educated as in developed countries and they don’t have the new technology that we do.Human, animal and plant diseases can spread more quickly through globalization.
- 41. Globalization in the Philippines
- 42. The country is taking part in the process of globalization ever since the country signed agreements with World Trade Organization in 1995.
- 43. • Now, globalization is very effective in the Philippines, it has allowed major changes in the nation like more labor, and more Filipino and foreign companies has emerged in the nation in order to help the country’s developing economy.
- 44. Globalization can make the Philippines into a better nation if the Philippine leaders to make their economy more advance through global trading and allowing more foreign investors to the help boost the economy. And by accomplishing those goals, the Philippines should be able to reduce the poverty level as well as increase labor force for job opportunities for those that are in need for a living.
- 45. However, since the poverty level is still increasing, most Filipinos has managed to find work overseas and they have managed to seek better living than in the Philippines.The most effective factor in the Philippines is education.The society’s mentality is to be educated and it’s with education that people in the nation see their opportunity for a better life in the future.
- 46. Advantage
- 47. Peaceful Relations Most of the countries haveresortedto traderelations with eachother in orderto boost their economy,leavingbehind any bitter past experiencesif any.
- 48. Employment Consideredas one of the most crucial advantages, globalization has led to the generation of numerous employment opportunities.Companiesare moving towards the developing countries to acquire laborforce.
- 49. Education A very critical advantage that has aided the populationis the spread of education.With numerouseducational institutions aroundthe globe,onecan move out fromthe homecountry for better opportunities elsewhere.
- 50. Product Quality The productqualityhas beenenhancedso as to retain the customers. Today the customers may compromisewith the price range but not with the qualityof the product. Low or poorquality can adversely affect consumer satisfaction.
- 51. Cheaper Prices Globalizationhas broughtin fierce competition inthe markets.
- 52. Communication Every singleinformation is easily accessible from almost every corner of the world.Circulationof informationis no longera tedioustask, and can happenin seconds. The Internet has significantlyaffected the globaleconomy,therebyproviding directaccess to informationand products.
- 53. Transportation Consideredas the wheel of every business organization, connectivity to various parts of the world is nomore a serious problem.Todaywith various modesof transportation available, one can convenientlydeliver the productsto a customer located at any part of the world.
- 54. GDP Increase Gross DomesticProduct, commonly known as GDP, is the money value of thefinal goods and services produced within the domestic territory of the country during an accounting year.
- 55. FreeTrade •Free trade is a policyin whicha countrydoes notlevy taxes, duties, subsidies or quota onthe import/export ofgoodsor services from other countries. There are countries which have resolved to free trade in specific regions.This allows consumers to buy goods and services, comparatively at a lowercost.
- 56. Travel andTourism •Globalizationhas promoted tourism to great heights. International trade among differentcountries also helps in increasing the number oftourists that visit differentplaces around the world.
- 57. External Borrowing •With the helpof globalization,there is opportunityfor corporate, national, andsub-national borrowers to have better access to external finance, with facilities such as external commercial borrowingand syndicated loans.
- 58. DisAdvantage
- 59. Health Issues Globalizationhas given rise tomore healthrisks and presents new threats andchallengesfor epidemics. - the dawnof HIV/AIDS. Havingits origin in the wildernessof Africa, the virus hasspread like wildfirethroughoutthe globe in no time. - Fooditems are alsotransportedto variouscountries,and this is a matter of concern, especiallyin case of perishableitems.
- 60. Loss of Culture With large numberof peoplemoving intoand out of a country, the culture takes a backseat. Peoplemay adapt to the culture of the resident country.They tend to followthe foreignculture more, forgetting their own roots.This can give rise to cultural conflicts.
- 61. UnevenWealth Distribution It is said that the rich are getting richer whilethe poorare getting poorer.In the real sense, globalizationhas not beenable to reduce poverty.
- 62. Environment Degradation The industrial revolution haschanged the outlookof the economy.Industries are using natural resources bymeans of mining,drilling,etc. whichputs a burdenon the environment.
- 63. Disparity Thoughglobalizationhas openednew avenues likewider markets andemployment,there still exists a disparity in the developmentof the economies.Structural unemploymentowes to the disparity created. Developedcountries are moving their factories to foreigncountries where laboris cheaply available.
- 64. Conflicts It has givenrise to terrorism and other forms of violence.Such acts not onlycause loss of humanlife butalso hugeeconomic losses.
- 65. Cut-throat Competition Openingthe doorsof international trade has givenbirth to intense competition.This has affected the local markets dramatically. The local players therebysuffer hugelosses as they lack the potential to advertise or export their products ona large scale. Thereforethe domestic markets shrink.
- 66. • Mukherjee, T. Narula, H. (2011), Globalization and its crises around the world, university of Tennessee.