Advantages and Disadvantages of Globalization to Economy

Advantages and Disadvantages of Globalization to EconomyIntroductionGlobalization in the world of business is the process of intertwining markets all around the world by means of businesses extending their influence and operation on a world(prenominal) weighing machine driving cross-border cover and enthronisation (The Levin Institute, 2014). It includes the spreading and influencing of world views, products, ideas and other aspects of cultivation (Al-Rodhan, 2006). The rapid advancement of it, aided by the assimilation of global transportation, parley and advancing technology affects the environment, culture, political systems, economic development and compassionate somatogenetic well beings in societies they reside in (The Levin Institute, 2014).The act of globalisation brings intimately a riches of benefits to both guest and host countries worldwide. This includes entirely non extensively employment, education, product quality, cheaper prices, mendd communication, tr ansportation, and economic development through redundant movement of capital, worldwide trade and GDP increase (Lovekar, 2013).Although honorable, it unwittingly likewise bring some an abundance of detrimental factors. Some major issues consist health issues, loss of culture, uneven wealth distribution, environment degradation, disparity, conflicts, and legion(predicate) others (Lovekar, 2013). An framework being the alluring promise of allowing impoverished countries to develop economically through globalisation inadvertently brings about the benefit of low-cost production from a detriment of instituting an under paid labor force.Considering the involvement of factors much(prenominal) as these (which get out be further elaborated using various fountain studies in the report to follow), we can see that positive countries that be the whizs take the charge of globalization, hold the control and power to implement the way globalization is carried out. T herefore these countries should implement the policy on globalization by startle taking a bigger step through advancing a deeper knowledge to under wheeling the impacts, and work towards solving problems and harmonizing the dividends across all parties touch by the monster of globalization (The Levin Institute, 2014).Advantages of globalization supranational tradeInternational trade has workd to the growth of U.S. providence in legion(predicate) areas. The export is treasured at $2.2 trillion in 2012 and has created up to 38 million blood opportunities in the state. This dough do from the trade will inadvertently slaver down the hierarchy and also help to raise the salary and wealth of the slew. Looking at the large amount of exports from U.S, we can deduce that international trade has allowed the expansion of business mechanization and the advancement of technology which inadvertently has helped businesses to maintain and salve up with competitors all around the world.As the U.S. bedchamber of Commerce (2014) pictures out, international trade through importing brings in a series of advantages much(prenominal) as providing an increased variety of goods that are non obtainable within the U.S. and make available all year round, products much(prenominal) as harvested crops that are non procurable from the rural itself during certain seasons in the year. Moreover, it inadvertently helps to increase the domestic expenditure as they bring war-ridden prices that raise the spending ability of the regular American, which eventually also contributes to the saving of U.S.. Through importing as well, manufacturing companies are able to purchase lancinating materials for production that are not readily available in the pastoral and on certain occasions at cheaper rates that will improve the profit margin (U.S.Chamber of Commerce, 2014).Therefore, we can see the importance of international trade and how the opening up of markets to foreign exchange benefits the c ountry, as it allows goods and services to be traded with ease, concurrently increasing business line opportunities and boosting economic growth.Foreign Direct investment (FDI)capital of capital of Singapores Integrated Resorts, Marina bay sands (MBS) and Resorts World Sentosa (RWS) are the main attractions for the touristry industry, and are the results of successful foreign direct investments. The tourism sector with these new attractions pick out brought in up to 13.2 million visitors and profited from $22.3 meg worth of tourists spending in 2011 alone. This has significantly contributed to not only the tourism industry but also to a red-blooded economic growth in Singapore.The FDI in this establishment of the Integrated Resorts jut has contributed up to 40,000 job employments in sectors such as retail and sustenance and Beverage (FB). It has also trickled down and inadvertently helped to retain Small and middling Enterprises (SMEs) that are mainly outsourced to provide goods and services to the tourism industry such as transportation, laundry and floral services (Ministry of Trade and Industry Singapore, 2012).As shown in the graph by HSBC, FDI increased instead of plummeting during the financial crises and that allowed Singapore to continue to bring up the economy during this time of trouble where it would be overwhelming otherwise. (Singapore Business Review, 2010)Capital functionIn 2013 Nestle, originally from Switzerland, spread out its research and development (RD) centre in Singapore. The company invested up to $5 million in this RD expansion and will create up to 20 more jobs patch continuing its employment strategy of procuring expertness from a global workforce (Yan, 2013). Its establishment here has brought not only a spike of economic growth during the companys time here, but also a decent pool of skillful and knowledgeable workers to Singapores labor market, and advanced technology in the field that will inadvertently aid in the gro wth of Singapores expertise in the area and provide a larger platform for afterlife expansion.Recently, Nestle has announced that they are going to increase the capital flow by widening its RD project in the form of more manpower, resources and investment (Grosse, 2014). Investments has been pumped into a project to build up food and living RD since January, consisting of a partnership with Singapores Agency for Science, Technology and investigate (A*STAR) (Grosse, 2014). With more capital flowing in to invest in such projects, Singapore would definitely benefit from this economic growth.Disadvantages of globalizationHuman beApple is known as the most successful and wealthiest company imputable to its manufacturing that is done globally. However, what Apple fails to disclose is that the major production of the devices came from China sweatshops.In order to meet the global demands of production set by the steering in a given timeframe, workers from the Apple manufacturing factor y in Chengdu utter that they were forced to work long hours, almost seven days a week, in harsh environments which resulted in the straining of workers health. Apart from that, in that location have been serious cases of abuse such as child labour and improper employees welfare. All these factors have concocted a hazardous environment that resulted in two blasts within the manufacturing factory itself, consequently bringing about requirement as no proper safety measurements were taken.Apple at that point in time had a narrow vision of company profit and growth, and that resulted in the company procuring methods that will increase the profit margin disregardless of ethics, and one of the targets was low-cost production. This inadvertently brought about the neglect of their 120,000 workers welfare (Duhigg and Barboza, 2012). Companies from essential countries tend to take advantage of workers from ontogenesis countries in order to meet their aggressive demand. This happens due( p) to racism, the tonicitying of superiority brought about by the factors such as the workers are a lower household due to the education level of evolution countries and even because they are not of their own nationality.PollutionAs China is on the rise to bring forth a large economic power, they have inadvertently contributed to a great environmental impact on the world.China has increasingly become one of the countries chosen by many of its real counterparts for factory establishment due to its ability to produce goods with low costs. However, with the increased number of factories setting up in China, it has resulted in the release of a huge amount of pestiferous industrial gases into the railway line create air pollution.In the study by The Proceedings of theNational Academy of Sciences,the release of such gases is connected to the large exports in China. The pollution has not only affected their neighbouring countries decreasing the quality of air but it has also sprea d over to the United States, causing haze in the westcoast. In order to curb this pollution created by China, highway and Stromberg (2014) suggested that it is a necessity for countries to come together and make a stand through subduing global political tensions and the goal of short-term economic incentives that prevents cooperation.And as mentioned in the reading, this increasing rate of the air pollution, would result in the impairment in the health of the Chinese and eventually the people at the persist of the world. (Lane and Stromberg, 2014)Insecurity and emphasisChinas recent movement of placing an petroleum rig near to Vietnam has caused an anti-china riot in Vietnam. This brought up a radiosensitive issue regarding the ownership of the area in which the oil rig was set at. The action has since resulted in many Vietnamese protestors reacting violently through the goal and burning down of many factories that are owned by FDI. As Vietnamese protestors could not differe ntiate the different nationalities, they unintentionally affected many FDI companies that are actually owned by Taiwanese or siemens Korean businessmen. Many factories operating in the area were forced to close down down and with businesses continually disrupted the violence caused a huge deterioration in income. Vietnamese protestors have been known to be targeting and attacking the Chinese employees as well. In which the riots have resulted in almost two fatalities while leaving many other Chinese nationals injured. Due to this continuous violence many Chinese were sent back to China for safety reasons (Whiteman, 2014). With many establishments of FDI businesses in global countries, it will cause its nation people to feel a sense of insecurity of others invading their country. As depicted in the recent China and Vietnam dispute, all it takes is such sensitive matter to ignitor all these insecurities.ConclusionAs mentioned above, globalization has proven to greatly contribute t o the countrys economic growth in both developed and maturation countries. It has not only created a substantial number of job opportunities around the world, it simultaneously allows the distribution of technology and knowledge between countries that are essential for their economys advancement. Globalisation is also a decisive for developing countries as the input from other countries aids in the fast-breaking and continuous development of the country.However, while countries are enjoying the fruits of the economys growth, there are consequences that appear a result of globalization mostly touch on the developing countries. As mentioned earlier, globalization has resulted in issues such as violating human rights, environment pollution and distrust among countries. With globalization constantly growing and here to stay, more concerns would arise.With the rise of globalization, it has created a disparity between countries in todays world. This is because while some countries ar e proving to be hubs where investments continually spill over in for that purpose, resulting in rapid economic growth, other countries that are not as attractive and less developed are struggling to keep up. Developing countries are gradually becoming the generator of the developed countries economy growth and instead of growing together, the economic gap between these countries continues to widen.A global wealth report in 2013 said that wealthiest 10% of the global population possesses 86% of worlds wealth while the coffin nail half of the rest possess less than 1%. As compared to developed countries which reports show an average of a $100,000 wealth per person, the standard wealth of severally person in the less developed countries was $5,000 or less (Appiah, 2014). In a report from 2012, it is said that the worlds population is made up of 82.5% who resides in less developed countries. This further shows that there are huge gaps in the wealth distribution between the developed and developing countries. It also means globalization while beneficial to the economy of developed countries, is inadvertently creating a larger disparity and straining the economic growth in the developing countries.Furthermore, globalization implicates internal problems within a country to the countries in which their businesses reside in. With the global economy differences, it creates social imbalance where people from both developed and developing countries hold different status and wealth, causing opportunities to be extended out only to the ones who can afford it (Appiah, 2014). Workers from developing countries working for these foreign companies feel that they are of lower status as compared to them. Due to the disparity, people from the developing countries feel disadvantaged and discontentment, which in an extreme point example resulted in the act of terrorism, aimed at developed countries (Appiah, 2014). The rise of globalization would also mean more foreign companies es tablishment in developing countries which will increase a deeper sense of insecurity among its people in these countries. An example would be the significant U.S. September 11 attacks in 2001 whereby the juvenile Yorks World Trade Center towers were being hit by planes that were hijacked by terrorist which eventually affected the worlds economic and global authorisation (BBC, n.d.). Violence is viewed as a repercussion of extensive unlikeness, affecting and flexile the worlds safety (Appiah, 2014).Therefore, globalization might be beneficial to the developed countries initially. However, with the rise of globalization, it would widen the gap that is of major disadvantage to the world, and this inequality would inadvertently cause tension that will lead to belligerent situations between countries.