Globalization And its Impact on Economy
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Globalization has enabled the rapid movement of goods, services, technologies and investments across countries through factors like improved technology and liberalization of trade barriers. While globalization has increased competition and consumer choice through greater foreign trade and the spread of culture and education, it has also been associated with growing inequality, environmental degradation, and threats to local culture from the dominance of foreign products and business practices.
Globalization And its Impact on Economy
- 2. • It is the process of rapid integration or interconnection between countries. • MNCs play a major role in the globalization process. • More and more good, services, technologies, investments etc. are moving around countries.
- 4. Web of GLOBALIZATION :
- 8. Rapid improvement in technology has been a major factor that has stimulated the globalization process. This has made much faster delivery of goods
- 9. Liberalization - the act of making less strict. Tax on imports Is an example of trade barrier. It is called a barrier because some restriction has been set up. Governments can use trade barriers to increase or decrease (regulate) foreign trade and to decide what kinds of goods and The Indian government, after Independence, had put barriers to foreign investment. This way considered necessary to protect the producers from within the country from foreign competition. In 1991, the government decided that time had come for Indian producers to compete with producers around the globe. It felt that competition would improve the performance of producers
- 11. Globalization and greater competition among as- has been of advantage to consumers. There is greater choice who now enjoy improved quality and lower prices for several products. As a result these people today enjoy much higher Increased Competition:
- 12. With globalization, companies have forayed into the developing countries and hence generated employment for them. It has given an opportunity to invest in the emerging markets and tap the talent which is available there. Due to global nature of the businesses, people of developing countries Employment:
- 13. While discussing the effects of globalization, how can we forget about the impact of foreign trade on an economy. Comparative advantage has always been a factor, even in during old times. While trade originated in the times of early kingdoms, it has been institutionalized Foreign Trade:
- 14. The world that we live in today is a result of several cultures coming together. Societies have become larger as they have welcomed people of other civilizations and backgrounds and created a whole new culture of their own. One of the most powerful effects of globalization is the spread of education. Today, you can move in the search of the best educational facilities in the world, without any hindrance. A person living in Spread of Culture & Education
- 15. MNCs have increased their investments in India over the past 15 years, which means investing in India has been interested in industries such as cell phones , auto mobiles, electronics , soft drinks , fat foods or services such as banking in urban areas. These products have a large number of well-off buyers. In the industries
- 18. It is said that the rich are getting richer while the poor are getting poorer. In the real sense, globalization has not been able to reduce poverty. Instead it has led to the accumulation of wealth and power in the hands of a few developed economies. Therefore the gap between the elite and the underprivileged seems to be a never ending road, eventually leading to
- 19. The industrial revolution has changed the outlook of the economy. Industries are using natural resources by means of mining, drilling, etc. which puts a burden on the environment. Natural resources are depleting and are on the verge of becoming extinct. Deforestation is practiced owing to the non- availability of land, thereby drastically reducing the forest cover. This in turn creates an imbalance in the environment leading to climate change and
- 20. Conventionally, people of a particular country follow its culture and traditions from time immemorial. With large number of people moving into and out of a country, the culture takes a backseat. People may adapt to the culture of the resident country. They tend to follow the foreign culture more, forgetting their own roots. This can give rise to cultural
- 21. Monopoly is a situation wherein only one seller has a say in a particular product or products. It is possible that when a product is the leader in its field, the company may begin to exploit the consumers. As there exists no close competitors, the leader takes full advantage of the sale of its product, which may later lead to illegal and unethical practices being followed. Monopoly is disastrous as