1. GlobalizationGlobalization refers to the increasingly global relationships of culture, people and economicactivity.

Most often, it refers to economics: the global distribution of the production of goods andservices, through reduction of barriers to international trade such as tariffs, export fees, and importquotas.Apparently Globalization has contributed to economic growth in developed and developingcountries through increased specialization and the principle of comparative advantage. Globalizationalso refers to the transnational circulation of ideas, languages, and popular culture.Globalization has been given many meanings in different contexts. One frequently-encounteredmeaning is that globalization is the homogenization of peoples tastes and demand patterns aroundthe world, due to increased access to international communication of information about productsand services as well as increased access to transportation of products and people across borders.From another perspective it may be seen as the threat of loss of national identity in response tohomogenization of lifestyles around the world. National identity is also threatened by the trendtoward reduction in the number of languages used When usedaround the world.Concepts:The United Nations says globalization is: in an economic context: it refers to the reduction and removal of barriers between national borders in order to facilitate the flow of goods, capital, services and labour... although considerable barriers remain to the flow of Takis Fotopoulos defined economic globalization as the opening andlabour... deregulation of commodity, capital and labour markets which led to the present Political globalization: named the emergence of aneoliberal globalization. Culturaltransnational elite and the phasing out of the nation-state. globalization: was the worldwide homogenization of culture. Other elements included "ideological globalization", "technological globalization" and "social Thomas L. Friedman popularized the term "flat world", arguingglobalization". that globalized trade, outsourcing, supply-chaining, and political forces had permanently changed the world, for better and worseThe Forces Behind Increased expansion and technological improvements inGlobalization Liberalization of cross-bordertransportation and communications networks trade and resource movements Development of services that support international business activities2. Increased global competition Growing consumer demand for foreign products Expanded cross-national treatiesChanging political and economic situations Creation of firms, leads toand agreementsThe Effects of GlobalizationPositive Create new jobs increase income levels, therefore, consumer demand Economies ofProduction advantages: new technology, raise workers skills Outsourced their Increase competicion in domestic industryNegative scale manufacturing and white-collar jobs to Third-World countries and developing It has led to an increase in activities such as: childeconomies, takes jobs Consumerism habits has increase junk food, branded products,labor and slavery Environmental degradationPositive Effects of Globalization Increased CompetitionOne of the most visible positive effects of globalization is the improved quality of products due toglobal competition. Customer service and the customer is the king approaches to production haveled to improved quality of products and services. As the domestic companies have to fight outforeign competition, they are compelled to raise their standards and customer satisfaction levels inorder to survive in the market. Increased EmploymentWith globalization, companies have penetrated into the developing countries and hence generatedemployment for them. It has given an opportunity to invest in the emerging

markets and takeadvantage of the talent which is available there. In developing countries, there is often a lack ofcapital which prevent the growth of domestic companies and hence, employment. In such cases, dueto global nature of the businesses, people of developing countries too can obtain gainfulemployment opportunities. Investment and Capital FlowsOne of the most visible positive effects of globalization is the flow of foreign capital. A lot ofcompanies have directly invested in developing economies. Many companies have benefited fromcapital inflow to improve production and services 3. Spread of TechnologyWhile it is generally assumed that all the innovations happen in the Western world, due toglobalization, technology also comes into developing countries due to globalization. Withoutglobalization, the knowledge of new inventions, medicines would remain confined in the countriesthat came up with them and no one else would benefit. But due to improved political ties, there is aflow of information both ways. Spread of CultureThe positive effects of globalization on culture are many! Not all good practices were born in onecivilization. The world that we live in today is a result of several cultures coming together. People ofone culture, if receptive, tend to see the flaws in their culture and pick up the culture which is morecorrect or in tune with the times. Societies have become larger as they have welcomed people ofother civilizations and backgrounds and created a whole new culture of their own. Cooking styles,languages and customs have spread all due Poorer countries sufferingto globalizationNegative Effects of Globalization disadvantagesWhile it is true that free trade encourages globalization among countries, some countries try toprotect their domestic suppliers. The main export of poorer countries is usually agricultural andcomodity goods. Larger countries often subsidise their farmers (e.g., the EUs Common TheAgriculturalPolicy), which lowers the market price for foreign crops. shift to outsourcingGlobalization allowed corporations to move manufacturing and service jobs from high cost locations,increasing unemployment in the domestic country. In rich countries, outsourcing has been a double-edged sword; it enabled cheaper services but displaced some service-sector jobs. However, in lower-cost locations such as India, the outsourcing industry is the "primary engine of the countrysdevelopment over the next few decades, contributing An increasebroadly to GDP growth, employment growth,and poverty alleviation" in exploitation of child labourCountries with weak protections for children are vulnerable to infestation by dishonest companiesand criminal gangs who exploit them. Examples include quarrying, salvage, and farm work as well astrafficking, Brain drainOpportunities in richforced labour, prostitution and pornography. countries attract skilled workers from poor countries, leading to brain drains.For example, nurses from poorer countries come to the US to work. This phenomenon cost Africaover $4.1 billion for the employment of 150,000 expatriate professionals annually, Spanish engineersare moving to Germany looking for better job prospects Working conditionsIn some developing countries labour policies provide4. less protection than in developed countries.One example is the use of sweat-shops by manufacturers. Clothing makers such as The Gap and Nikewere accused of contracting with factories that used child labour in violation of PoliticalGlobalization reduced the importance of nation states.local and law Sub-state and supra-state institutions such asthe European Union, the WTO, the G8 or the International Criminal Court, replace national functionswith CulturalMandarin is the first language of 845international agreements. million speakers, followed by Spanish (329 million speakers)and English (328 million speakers). However the most popular second

language is undoubtedlyEnglish, the "lingua franca" of globalization: About 35% of the worlds mail, telexes, and cables are in English. Approximately 40% of the worlds radio programs are in English. Some 3.5 billion people have some acquaintance of the language. English is the dominant language on the Internet EnvironmentalEnvironmental challenges such as climate change, water and air pollution and over-fishing of theocean, require trans-national/global solutions. Since factories in developing countries increasedglobal output and experienced less environmental regulation, globalism substantially increasedpollution and ConsumerismConsumerism is a socialhave a severe impact on natural resources and economic order based on fostering a desire to purchase goods andservices in ever greater amounts.Opponents of consumerism argue that many luxuries and unnecessary consumer products may actas social mechanism allowing people to identify likeminded individuals through the display ofsimilar products, again utilizing aspects of status-symbolism to judge socioeconomic status andsocial stratification. Critics of consumerism often point out that consumerist societies are moreprone to damage the environment, contribute to global warming and use up resources at a higherrate than other societies. 5. Inequalities in consumption are stark. Globally, the 20% of the worlds people in the highest-incomecountries account for 86% of total consumption while The richest consume 45% ofthe poorest 20% a minuscule 1.3%. Morespecifically: The richest consume 58% of totalall meat and fish, the poorest fifth 5% The richest consume have 74% of allenergy, the poorest fifth less than 4% The richest consume 84% of all paper,telephone lines, the poorest fifth 1.5% The richest own 87% of the worlds vehicle fleet, thethe poorest fifth 1.1% poorest less than 1%Runaway growth in consumption in the past 50 years is putting strains on the environment neverbefore seen.Sustainable ConsumptionSustainable consumption is: the use of goods and services that respond to basic needs and bring abetter quality of life, while minimising the use of natural resources, toxic materials and emissions ofwaste and pollutants over the life-cycle, so as not to jeopardise the needs of future generations(OECD, 2002)The great challenge faced by economies today is to integrate environmental sustainability witheconomic growth and welfare by decoupling environmental degradation from economic growth anddoing more with less. This is one of the key objectives of the European Union, but the consequencesof climate change and the growing demand for energy and resources are challenging this objective.International Trade 6. International trade is the exchange of capital, goods, and services across international borders orterritories. In most countries, such trade represents a significant share of gross domestic product(GDP). While international trade has been present throughout much of history (Silk Road, AmberRoad, etc), its economic, social, and political importance has been on the rise in recent centuries.Industrialization, advanced transportation, globalization, multinational corporations, andoutsourcing are all having a major impact on the international trade system. Increasing internationaltrade is crucial to the continuance of globalization. Without international trade, nations would belimited to the goods and services produced within their own borders.Foreign Direct InvestmentAccording to the International Monetary Fund, foreign direct investment, commonly known as FDI,"... refers to an investment made to acquire lasting or long-term interest in firms operating outside of theeconomy of the investor." The investment is direct because the investor, (foreign person, company or group ofentities), is seeking to control, manage, or have significant influence over the

foreign firmFDI is a major source of external finance which means that countries with limited amounts of capitalcan receive finance beyond national borders from wealthier countriesWhy Do Companies Market seeking: Firm may go to find new buyers for thierInvest Overseas? Resource seeking: A company may find it cheaper to producegoods and services its product in a foreing subsidiary. The foreing facilities may be able to superior or les costly access to the imputs: (land, labour, natural resources) Strategic seeking: firms may seek invest in other companiesthan at home abroad to improve distribution network or new technology Efficiency seeking: Multinationals may seek to be more competitive, in7. response to economic changesCompanies doing business across international borders face many risks Buyer insolvency (purchaser cannot pay); Non-acceptance (buyer rejects goods as different from the agreed upon specifications); Credit risk (allowing the buyer to take possession of goods prior to payment); Intervention (governmental action to prevent a transaction being completed); Political risk (change in leadership interfering with transactions or prices); and War, piracy and civil unrest or turmoil; Natural catastrophes, freak weather and other uncontrollable and unpredictable eventsProtectionismMay be defined as any policy that is intended to protect domestic industries from importcompetition One of the common reason for the creation of trade barriers is to encourage localproduction by making more difficult for foreign firm to compete there.Protectionism is the economic policy of restraining trade between states through methods such astariffs on imported goods, restrictive quotas, and a variety of other government regulationsdesigned to discourage imports and prevent foreign take-over of domestic markets and companies.Government implement restriction on importation with the objective of fight unemployment andcreate jobs in the domestic market. This policy contrasts with free trade, where government barriersto trade and movement of capital are kept to a minimumThe main reasons for protectionism are: Protect local jobs and fight unemployment Encourage local production to replace imports Protect infant industries Reduce dependence on foreign suppliers Encourage local and foreign investment Reduce balance payment problems Promote export activitiesThe World BankThe mission of the World Bank is to reduce poverty in middle-income and creditworthy poorercountries by promoting sustainable development, through loans, guarantees, and advisory services.The World Bank aims at issues such as building infrastructure (roads, dams, power plants), naturaldisaster relief, humanitarian emergencies, poverty reduction, infant mortality, gender equality,education, and long-term development issues. 8. Furthermore, the World Bank tries to foster social reforms to promote economic development, suchthe empowerment of women, building schools and health centres, provision of clean water andelectricity, fighting disease, and protecting the environment.Since 2000, the World Bank has been devoted to helping implement the Millennium DevelopmentGoals (MDGs) The goals are as follows:1. Eradicate extreme poverty and hunger.2. Achieve universal primary education.3. Promote gender equality and empower women.4. Reduce child mortality.5. Improve maternal health.6. Combat HIV/AIDS, malaria, and other diseases.7. Ensure environmental sustainability.8. Develop a global partnership for development.Why Is the World Bank Controversial?The World Bank, TWO and International Monetary Fund; all these organizations exemplify theglobalization of policymaking, which causes national governments to lose some of their sovereignability to set the rules of the game for their citizens/residents. While such multilateral organizationshave existed for centuries, the particular power of the WTO to force member countries to eliminatesome policies that

interfere with free trade, and to treat other member countries equally, certainlythreatens those who want a more independent national policy framework.