IMPACT OF GLOBALIZATION Ajith S

Ratheesh Kumar

GLOBALIZATIONOngoing process by which regional

economies, societies, and cultures have become integrated through a globe-spanning network of communication and execution

Greater integration within the world economy via increased openness to: International trade International capital and labor movements International flow of technology International flow of information, knowledge, and ideas (Internet super-highway)

 GLOBALIZATION AND THE DECLINE IN POWER OF NATIONAL GOVERNMENTSMost countries felt decline in their powerEmergence of World bank, European union'It is not just that governments can no

longer "manage" their national economies', to survive in office they must increasingly "manage" national politics in such a ways as to adapt them to the pressures of trans-national market forces'. 

Globalization as a synonym to ‘World government’

As George Monbiot has argued with respect to Britain, for example: the provision of hospitals, roads and prisons... has been deliberately tailored to meet corporate demands rather than public need'

• Movement of material and goods between and within national boundaries

• Emergence of worldwide financial markets and better access to external financing for borrowers

• Realization of a global common market, based on the freedom of exchange of goods and capital

• Increased budgetary pressure.

• Growth of cross-cultural contacts• Greater international travel and tourism• Spread of local consumer products (e.g., food) to

other countries • Development of a Global Information System,

global telecommunications infrastructure and greater transborder data flow, using such technologies as the Internet, communication satellites, submarine fiber optic cable, and wireless telephones

• The creation of the international criminal court and international justice movements

THE POWER OF BIG BUSINESS CORPORATIONSOf the 100 largest economies in the world, 51

are now global corporations and only 49 are countries

The combined sales of the world's top 200 corporations are far greater than a quarter of the world's economic activity

-Ms Sarah Anderson and Mr John Cavanagh of Corporate Watch

Lead to greater levels of employment providing job opportunities to the local labour

A vehicle for faster transfer and diffusion of technology

Provide the host country with foreign exchange Hurt domestic firms by eliminating competition

(due to enjoying comparative advantage over local firms)

Worsen the imbalance between rural and urban areas (growing difference between incomes)

Impact on local communitiesContract for cheap laborNew & under exploitation of marketSignificant influence with respect to policy

formulation of government

Globalization and the multinationalsThe degree of control they have over the

central dynamics of globalization remains limited. 

Amartya Sen (2002) has argued that 'the market economy does not work by itself in global relations--indeed, it cannot operate alone even within a given country'.

FAQWhether actual distribution of gain is fair?Whether the poor benefit less than

proportionately from globalization?Who bares the cost?Whether changes in inequality and the

observed poverty dynamics are related to globalization?

Globalization and Its Discontents

GLOBALIZATION AND ITS EFFECT ON THE WORLD’S POOREven when there are new opportunities for jobs

opened by the integration into the international economy, old jobs and occupations disappear

Poverty remains one of the most serious international challenges

Improvement in the lifestyleNon – equitable distribution of wealthCultural DifferencesChild LabourNegative impact on local business

POORER COUNTRIES SUFFERING DISADVANTAGESWhile it is true that globalization encourages

free trade among countries, there are also negative consequences because some countries try to save their national markets. The main export of poorer countries is usually agricultural goods. Larger countries often subsidize their farmers (like the EU Common Agricultural Policy), which lowers the market price for the poor farmer's crops compared to what it would be under free trade.

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