Globalization Consequences Essay

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There is no set definition for the word globalization, but the concept can be understood in general terms of reflect a trend towards the removal of barriers to the flows of goods, information, capital, people and ideas, such that these flows transcend the paradigm of the nation-state (Higgott & Reich, 1998). As a general, largely unguided force, globalization is ethically neutral almost by definition, but the outcomes of globalization affect people, regions, nations and cultures in almost everything they do. By its very nature, globalization reaches all corners of the world, and in doing so challenges the different barriers -- national, ethnic, religious, economic, linguistic -- that we have erected to differentiate between groups of people.

Often, when we speak of globalization, the concept is seen as something that is under the control of forces. This is perhaps an overstatement, and it is precisely the lack of control over the process of globalization that is one of the greatest downfalls of this phenomenon. The forces that are usually implied to be in control of the globalization process are multinational bodies (the UN, NATO, the IMF, the World Bank), multinational corporations and the world's dominant neo-liberal nations, neoliberalism being the driving philosophical underpinning of the globalization movement. These forces are contrasted against everybody and everything else.Download full Download Microsoft Word File
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TOPIC: Essay on Globalization Consequences Assignment

While it may be true that the "powers" do have more control over the process of globalization, the process is democratic in that the actions all individuals and all bodies in the world contribute to its development. The information aspect of globalization is barely regulated at all. With the Internet and Google translate, information flows freely to just about every corner of the world, even if the recipient speaks a different language (Rifkin, 2002). The rapid transfer of information and ideas is arguably a much more significant flow than the transfer of goods in container ships, refugees across land borders or even capital between major banks. Yet, the flow of information and ideas is subject to almost no regulation. The drivers of globalization relate to economic efficiency, something that demands less regulation, so even those with the most power over the process of globalization are working to unwind that power and increase the democratization of the process.

The risk with this is that the outcomes are less predictable. Control is ceded to "the market," a nebulous concept mostly meaning the sum total of individual decisions. No one person is responsible for any outcome -- it is only on aggregate that outcomes occur. The outcomes, in theory, are the most economically efficient, but economics does not account for other types of outcomes. Economic efficiency typically ignores non-economic externalities like environmental degradation and human suffering. It is not that the pursuit of economic outcomes solely is unethical, it is simply that all outcomes are not included in market function. There is no immediate and direct cost associated with environmental degradation and human suffering, and this lack of immediate and direct costs distorts the market. Thus, when the world's powerful actors cede control over the course of globalization to "the market," they do so knowing that economic efficiency is not the sum total of outcomes, and that some of the other outcomes are not only negative but out of anybody's control at that point.

Environmental degradation occurs for a number of reasons. The first is that globalization results in more efficient markets. This in turn results in an increase in wealth for the world at large. In a world with a stable population and free from resource constraints, humanity would eventually settle into a happy equilibrium. However, in a world with resource constraints and a rising population, our need for resources bumps up against those constraints, resulting degradation, the consequence of unsustainable practices (Urdal, 2005). The normal protections against these unsustainable practices come from strong regulation, but strong regulation needs to be reduced in order to obtain economic efficiency.

Human suffering also is a negative consequence of globalization. The path towards economic efficiency results in a reallocation of resources roughly in line with the concept of comparative advantage. De Grauwe and Polan (2003) argue that the pursuit of economic competitiveness does not necessarily reflect a tradeoff in social spending. Reallocation of resources over a short period of time, however, does lead to negative human outcomes. For example, economic progress breeds inflation, but if prices rise higher than wages in a nation, the people will lose buying power. This is especially true in nations with high levels of income disparity. Another example is that an industry may become uncompetitive in one country, leading to its moving to another country. For the workers in the original country, this may cause job loss. It is argued that there may be opportunities opening up elsewhere within that economy, but those who have lost their jobs may be unable to retrain or re-educate to take advantage of those new opportunities. As a result, globalization results in reduced income for those people on a permanent basis. While economies are always in a state of evolution and globalization is just one of the factors affecting them (IMF, 2000), many workers are constrained in their ability to adapt quickly to new conditions, and many nations lack adequate retraining programs or social safety nets to help such workers.

However, the increase in economic efficient that globalization brings about does create tremendous opportunities, especially for those who possess education, capital, good health and other desirable attributes. Increased trade provides new opportunities as does an increase in the availability of other factor inputs. With greater access to markets, people in smaller nations have better capacity for economic growth. Nations that were once on the periphery of the world economy have no become important players, simply by increasing their participation in the global system, and therefore taking advantage of the opportunities presented by globalization and trade according to comparative advantage.

Another benefit of globalization is social, in the theory that the more people become exposed to one another, and the higher the degree of economic integration, the less likely they will to be in conflict with one another. Some of the most truculent actors on the world stage are also the ones least involved in the global system. The European Union was founded in part as a social experiment to reduce the amount of conflict in Europe following two horrific wars in the first half of the 20th century (Dinan, 2005). Thus far, this perceived benefit may not have come to pass. However, it is difficult to ascertain the success of a preventative measure, because one has no idea of knowing what might have otherwise transpired. For now, however, globalization has avoided major global conflicts and created some strong links between nations that might otherwise pursue armed conflict with one another.

All told, globalization as a phenomenon brings with it a lot of opportunity for those well-equipped to take advantage of it. Freer movement of capital, goods and information in particular allow those with the ability to access those things and put them together to have better growth opportunities and more access to markets. As a people, we have better ability to come together, because barriers to communication are falling. This should hopefully foster greater understanding and serve as a preventative measure against conflict. Already we are beginning to see the emergence of global cities with highly diverse populations, something that was rare during the early days of nation-states.

The downside is that the forces driving globalization are largely out of anybody's control. This means that we have little ability to achieve the non-economic outcomes that we as a species might find desirable. While freer markets in particular lead to economic efficiency, they also reallocate resources more quickly that people, or the environment, can adapt. Worse, these outcomes are… [END OF PREVIEW] . . . READ MORE

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How to Cite "Globalization Consequences" Essay in a Bibliography:

APA Style

Globalization Consequences.  (2012, May 21).  Retrieved October 16, 2021, from

MLA Format

"Globalization Consequences."  21 May 2012.  Web.  16 October 2021. <>.

Chicago Style

"Globalization Consequences."  May 21, 2012.  Accessed October 16, 2021.