Containerisation The costs of ocean shipping have come down, due to containerisation, bulk shipping, and other efficiencies.
Many emerging countries have their own transnational corporations Differences in tax systems The desire of businesses to benefit from lower unit labour costs and other favourable production factors abroad has encouraged countries to adjust their tax systems to attract foreign direct investment FDI. Less protectionism Old forms of non-tariff protection such as import licensing and foreign exchange controls have gradually been dismantled.
Growth Strategies of Transnational and Multinational Companies In their pursuit of revenue and profit growth, increasingly global businesses and brands have invested significantly in expanding internationally. Our subjects Our Subjects. Explore Explore. Contact Contact. Back to top. However the process by which globalisation happens has accelerated in recent years due to some important drivers. Want to keep learning? This content is taken from Coventry University online course,.
Before you leave this step, take another look over each factor — does one stand out to you as being the most important? This content is taken from Coventry University online course. Share this post. See other articles from this course. This article is from the online course:. Join Now. News categories. Globalization has benefits that cover many different areas. It reciprocally developed economies all over the world and increased cultural exchanges.
It also allowed financial exchanges between companies, changing the paradigm of work. Many people are nowadays citizens of the world. The origin of goods became secondary and geographic distance is no longer a barrier for many services to happen. The most visible impacts of globalization are definitely the ones affecting the economic world.
Globalization has led to a sharp increase in trade and economic exchanges, but also to a multiplication of financial exchanges.
In the s world economies opened up and the development of free trade policies accelerated the globalization phenomenon. Between and , world exports increased fold. This significantly contributed to increasing the interactions between different regions of the world. This acceleration of economic exchanges has led to strong global economic growth. It fostered as well a rapid global industrial development that allowed the rapid development of many of the technologies and commodities we have available nowadays.
Knowledge became easily shared and international cooperation among the brightest minds speeded things up. According to some analysts, globalization has also contributed to improving global economic conditions, creating much economic wealth thas was, nevertheless, unequally distributed — more information ahead.
At the same time, finance also became globalized. From the s, driven by neo-liberal policies, the world of finance gradually opened. This financial globalization has contributed to the rise of a global financial market in which contracts and capital exchanges have multiplied. Together with economic and financial globalization, there has obviously also been cultural globalization.
Indeed, the multiplication of economic and financial exchanges has been followed by an increase in human exchanges such as migration, expatriation or traveling.
These human exchanges have contributed to the development of cultural exchanges. This means that different customs and habits shared among local communities have been shared among communities that used to have different procedures and even different beliefs. Good examples of cultural globalization are, for instance, the trading of commodities such as coffee or avocados.
Coffee is said to be originally from Ethiopia and consumed in the Arabid region. Nonetheless, due to commercial trades after the 11th century, it is nowadays known as a globally consumed commodity. Avocados , for instance, grown mostly under the tropical temperatures of Mexico, the Dominican Republic or Peru. They started by being produced in small quantities to supply the local populations but today guacamole or avocado toasts are common in meals all over the world.
At the same time, books, movies, and music are now instantaneously available all around the world thanks to the development of the digital world and the power of the internet. These are perhaps the greatest contributors to the speed at which cultural exchanges and globalization are happening. Globalization is a complex phenomenon. As such, it has a considerable influence on several areas of contemporary societies.
From languages to traditions or even specific industries. Despite its benefits, the economic growth driven by globalization has not been done without awakening criticism. The consequences of globalization are far from homogeneous: income inequalities, disproportional wealth and trades that benefit parties differently.
Many critics have also pointed out that globalization has negative effects on the environment. Thus, the massive development of transport that has been the basis of globalization is also responsible for serious environmental problems such as greenhouse gas emissions, global warming or air pollution. At the same time, global economic growth and industrial productivity are both the driving force and the major consequences of globalization.
They also have big environmental consequences as they contribute to the depletion of natural resources, deforestation and the destruction of ecosystems and loss of biodiversity.
The worldwide distribution of goods is also creating a big garbage problem, especially on what concerns plastic pollution.
Globalization affects all sectors of activity to a greater or lesser extent. By doing so, its gap with issues that have to do with sustainable development and corporate social responsibility is short. By promoting large-scale industrial production and the globalized circulation of goods, globalization is sometimes opposed to concepts such as resource savings, energy savings or the limitation of greenhouse gases.
As a result, critics of globalization often argue that it contributes to accelerating climate change and that it does not respect the principles of ecology.
Many scholars argue that parts of the world have always influenced other parts and that the current state of affairs is a natural progression from earlier stages. The exchange of ideas and trade has, in one form or another, existed as long as humanity has existed. There are, of course, different marking points determining true globalization, from ancient trade routes to modern global integration of financial markets , all of which have been made possible by the creation and development of technology.
International Monetary Fund. Accessed Aug. World Economic Forum. National Geographic. Bruce Mazlish. Pages The Guardian. National Bureau of Economic Research. World Gold Council. The Bretton Woods Project. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data.
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