Globalizationhas Had More Positive than Negative Effects on the State
Globalizationhas had More Positive than Negative Effects on the State
Therehas been considerable research from the academia from different partsof the world about the negative effects globalization. The immenseattention to the negative issues caused by the globalization such asan increased north-south income gap, increased transactionalexternalities between individuals and firms, erosion of culture, andthe rise of consumerism has overshadowed the progress the state hasmade since advent of globalization. Interestingly, a lot of researchhas sensationalized to the point that even the academia has lostsight of matters in the trade. Before exploring the benefits thatglobalization has brought to the state, a brief definition casts thesubject matter in perspective. Globalization is the process throughwhich people from different parts of the world become integrated interms of trade and other aspects of life such as communication,inter-government relations, and social systems (Benyon& Dunkerley, 2014). In contemporary terms, trade and investmentsare the main tenets of globalization exacerbated by advancements ininformation, communications and technology. The general effects of amore globalized world touch culture, the natural environment,political systems, the well-being of human beings, and economicgrowth and development. It is worth noting that globalization is aprocess has been on-going, but gained traction after WWII when theworld felt that more inter-connections among the community of nationshad the potential to bring lasting peace. Perhaps, the benefits ofglobalization are as complex to explain as the negative effects,except that nationalistic tendencies of the intelligentsia indifferent countries with warring views of a globalized world orderfind more expediency to putting across the negative effects. It isundeniable that globalization is impacting on lives of many people onthe plant regardless of their age, class, ethnicity, gender, and thegeographical place they live.
Thereare unique features that embody globalization in contemporary terms.They include:
Increasingspeed and volume: The volume of goods being moved per unit time andthe dissemination of messages and symbols has tremendously increased(p. 5).
Shrinkingspace: The interpretation of space is currently in terms of time andtravel or communication. As communication time decreases aided byinstantaneous telecommunication, the result is an increasingshrinking space (p. 6).
Permeableborders: The political and geographical borders have become permeabledue to increased relations between countries through trade, tourism,and electronic communication (p. 6). The degree ofinterconnectedness among different countries in the world isincreasing. Events that occur in part of the world have an almosttotal effect in another country. In fact is has become unfathomableterms such as national autonomy or isolation. Cultural, economic, andpolitical changes in a country are increasingly become a globalaffair rather than a preserve of national governments.
Reflexivity:People are increasingly becoming oriented to the worldview of issues.For instance, there are many people referring to themselves as‘locals’ as well as ‘cosmopolitans’ (p. 7).
Riskand trust: Everyone everywhere in the world is involved. The web hasbecome a site of trust and risk with increased dependency on‘experts’. A rise or fall of share prices on the New York Stockmarkets sends ripple effects on the Tokyo Stock market and onlyexperts can explain that (p. 7).
Arise in globalization has had more positive effects on the statecompared to the negative effects that come with it. Firstly, themodern consumer has a multifaceted exposure to diverse products inthe market originating from the domestic and the domestic market.Imagine of a world where no country trades with another country andinformation flow is a preserve of nation states. Although it utopianto think so, that world would be uncompetitive because there would beno innovation and the quality of life would be very low. Forinstance, the magnificence of Apple Company’s products could onlybe enjoyed by U.S. citizens. Most probably, Apple’s products wouldnot be as magnificent as they are today because the market could bevery small to bring any incentives from diversification throughinnovations. A poor country in Africa could be isolated from therest of world with no communication and transfer of capital. Thereare those who argue that globalization has increased dumping ofproducts in poor countries leading to environmental hazards thatcause diseases and affect the quality of life. While such assertionsare true, globalization does not operate in spite of internationaland domestic laws on trade. Countries can still trade with otherwithin a framework of mutual benefits in the scope of internationalstandards and regulations (Lu& Beamish, 2004). Furthermore, countries still have theopportunity to invoke their sovereignty to prevent unfavorableeffects of trade with other countries.
Globalizationis the single-most case of product and market diversification. Thereis research evidence that suggests that product and geographicaldiversity has increases the performance of multinationalcompanies(Bacchetta& Jansen, 2011). However, the growth of multinationals alsocomes with off-shoring of jobs, which has a general negative effecton employees in developed countries especially for low-skilledworkers. Nonetheless, media statistics that sensationalize theoff-shoring debate do not rely on plausible economic arguments andempirical evidence. For example, Barclays Bank which hasconsiderable investments in India off-shored five hundred jobs toIndia. For a layman, it means that the India has five hundred morejobs from the Barclays at the expense of the United Kingdom, which isthe home country. However, the calculations to determine theemployment effects of globalization are quite complex and anamorphous judgment based on figures are irrational (p. 23). Contraryto the common notion that job off-shoring as a result ofglobalization exacerbates unemployment in home countries, empiricalevidence through a study by Gorg* and Greenaway (2003)showed thatoff-shoring of different company activities, including certain jobsleads to a higher job turnover in the short run. In the long-run,Gorg also demonstrated a lack of direct link between offshoring andoverall unemployment in home countries. Statistics on low-skilledworkers that lose jobs due to off-shoring are economicallyinsignificant and high job turnover that comes with globalizationoutweighs the jobs lost.Furthermore, the interplay of tasks andeducation in relation to gains or losses of jobs as a result ofoff-shoring still needs further research because existing literatureis not persuasion about off-shoring as a negative effect ofglobalization. As everything thing stands now the global expansionof firms to more net benefits to the home country in terms of GrossDomestic Product (GDP) or Gross Net Product (GNP). Thus, more jobsare created through a national income rise as a result ofglobalization than the few jobs that are lost when companiesoff-shore certain processes to other trading partners.
Throughglobalization, there has been a worldwide dissemination of practicessuch as improved energy efficiency, resource substitution,dematerialization of economies, and metal recoverytechnologies(Sharma& Starik, 2002, p. 36). While globalization picked up during thepetroleum and coal age where many industrialized as well asdeveloping countries relied on oil and coal as the main sources ofenergy, improved innovations due to expansive markets and regulatorydemands on the global stage have led to a rise of sustainableproduction practices (p. 36). The increase in the global cost ofproduction in the 1960s, 70s, and 80s led to a global ecologymovement that sought to enhance environmental responsiveness inglobal production systems. Environmental responsiveness isresponsible for the fall in the global cost of production by over onehalf in the last three decades (p. 36). Hence, the argument thatglobalization causes pollution fails to acknowledge that the risinggreen technologies are also is at a pace capable of eliminating thesocial costs of pollution in the long-run. The benefits of globalizedproduction coupled with the milestones of the existing ecologymovement outweigh environmental social costs.
Inconclusion, globalization has had positive as well as negativeeffects, but the former outweighs the former in many ways. Researchthat focuses on negative effects of globalization relies is usuallyisolative and fails to address the aggregate effects of reduced tradetariffs, interconnected people, spontaneous real-time communication,and other factors that enhance lives on the global stage. Policymakers should, therefore, compare the economic arguments againstglobalization with empirical evidence on different variables. Nowthat it is impossible absolute positive effects of globalization keyfocus should be on the overall positive welfare effects on thewinners that normally mitigate the losses incurred. Furthermore,there should be efforts to identify specific losses as a result ofglobalization. Some losses arise due to other macroeconomic aspectssuch as increased domestic competition on the domestic market ratherthan globalization.
Bacchetta,M., & Jansen, M. (2011). Making globalization sociallysustainable. International Labour Organization (ILO) and World TradeOrganization (WTO).
Benyon,J., & Dunkerley, D. (2014). Globalization:the reader.Routledge.
Gorg,H., & Greenaway, D. (2003). Muchado about nothing? Do domestic firms really benefit from foreigndirect investment?.
Lu,J. W., & Beamish, P. W. (2004). International diversification andfirm performance: The S-curve hypothesis. Academyof management journal,47(4), 598-609.
Sharma,S., & Starik, M. (Eds.). (2002). Researchin corporate sustainability: The evolving theory and practice oforganizations in the natural environment.Edward Elgar Publishing.