Globalization refers to the rapidly developing process of complex interconnections between societies  Many, if not most, of the things we buy are usually made from another country

What is Globalization?
Globalization is the process of international integration of products, technologies, human resources, capital, information and culture.  As Globalization progresses, economics social and political of different countries more freely interacts with one another and adapt to promote further interaction.

What is Globalization?

There are four main parts
• globalization of economy • globalization of politics • globalization of human flows • globalization of culture

Level & Indicators of Globalization

WORLD LEVEL GLOBALIZATIONForeign Direct Investment GDP Multinational Companies Foreign Exchange Foreign Exchange Markets Balance of Payments (BoP)

COUNTRY LEVEL GLOBALIZATIONNational Income Investment Income International Tourism Traffic

Level & Indicators of Globalization

INDUSTRY LEVEL GLOBALIZATIONIndustry Exports Foreign Investment in Industry Investment Income

FIRM LEVEL GLOBALIZATIONEntry to Foreign Market International Licensing Joint Venture

Globalization Trends

Reduction in Import tariffs Removal of quantitative restriction Liberalization of Entry of Multinational Corporation Liberalization to FDI Freedom to FII Convertibility of Rupee on Current Account

Recent measure to promote Globalization

Trade measure

Foreign Investment measure

Foreign portfolio management External commercial borrowing

Benefits & Cost of Globalization

• • • • Faster economic growth Better living standards Democratization Free interchange of ideas, values; new opportunities

• Greater risk/variance in outcomes • Greater income inequality • Social dislocation

Marketplace doesn't always advance social objectives

Challenges of Global Diversity

Diversity and complexity of systems that transnational corporations face creates challenges, for example • If a company does business in a nation that does not grant women equal rights, should that company hire and promote women at work, even if it violates local laws and customs? • Should a company enter into a business venture with a government-owned enterprise if that government has a reputation for violating its citizens’ human rights?

Globalization : Good or Bad?

Economic globalization is good because
• Big firms means more efficiency • A bigger economic ‘cake’ for al globally • Free movement of money means that LDCs can develop

True : the world economy is bigger & more of the world can afford modern consumer goods Other positive benefits include the transmission of common values on human & civil rights, democracy and exposure to culture diversity Resistance movements are in one sense a symptom of the wider process

Globalization : Good or Bad?
 

BUT negative sides to (economic) globalization Anti-globalization protesters highlight these at G8 summits

Key issues • Effect on democracy & national governments • Growing wealth inequalities • Excessive power of TNCs & financial markets

Globalization benefits the wealthy at the expense of the poor majority Huge poverty still in Africa, Latin America & Asia (in some place getting worse) Also environmental destruction: Brazilian rainforest, demise of big game in kenya, turtles in the Carribean