Globalization seems to have many negative connotations, even after it has become the staple for world commerce. Many feel that globalization is not only a threat to their careers and income potential but also to their way of life. It has become a derogatory word in the U.S., with many naysayers refusing to see the positive impacts globalization has brought not only to other countries but also to our homes and businesses here in the U.S.A.
Perhaps those that oppose globalization don’t truly understand all of the positive benefits it can, and has, created. Perhaps we can just blame it on ignorance and people are still in the dark about all of the positive effects globalization has had on our nation. To fix that, we are going to list four positive impacts globalization has had. Maybe, once they know how beneficial globalization is, fewer people will be against it.
What is Globalization?
Maybe those who oppose globalization do so because they don’t know what it is exactly. While it is difficult to define such a powerful process as globalization, the most accurate answer would be the process by which governments and companies across the globe interact and integrate. It takes its direction from global business and trade. However, there is more to globalization than simply another term for the integration of international business. Communication, trade, economics, finances and standard of living is also a part of it. Technology is the main driving force behind globalization and has improved the way economic opportunities for companies and consumers alike.
A lot of the opposers to globalization claim that it has degraded their standard of living. Since U.S. residents are accustomed to having clean drinking water, food on the table, and a roof over our heads, we have gradually taken these standards of living for granted. We have forgotten about the rest of humanity that have to drink contaminated water, go days without food, and call an earthen bed their home.
Globalization has helped countless people in developing countries to find work. It has created an opportunity for investing in emerging markets and discover talent that had been dormant previously, allowing people in developing countries to work and use this opportunity to start their own companies.
Did globalization prevent people from trading in their 2016 model car for a new 2017 model? Perhaps, but globalization has made it possible for hundreds of thousands, if not millions, of people across the globe to have a better standard of living with clean drinking water and food on the table.
When there are several companies competing for the consumer’s business, it creates an advantageous opportunity for the consumer. This not only causes pricing competitions between the various competing companies, it also means the quality of the goods and services offered increases. So, prices drop, quality increases, what’s wrong with that?
This was made possible as businesses started to penetrate international borders and introduced better standards into parts of the global market where consumers had limited options previously. With this increase in competition, manufacturers and suppliers had to continuously find ways to take more of the market share. Hence, better pricing and better products.
An Increase in Market Efficiency
One benefit that every economy strives for is improved market efficiency. Markets demonstrate efficiency when buyers are willing to pay for goods or services that sellers are willing to offer. By outsourcing, manufacturers and companies can obtain components and materials that retain quality but are purchased at lower cost, thereby offering their services or products at lower prices and increasing the demand for their products or services. Even if prices remain the same, companies can then reallocate the additional profits into other areas, such as more investing, expansion, or wage increases.
This may sound farfetched, but when two countries rely on each other for a stable economy, the chances of a conflict starting between the two decrease considerably. Globalization, maybe indirectly, has helped to prevent many conflicts at various points. Yes, violence is still occurring around the world and it is highly unlikely that globalization or any other act will stop all conflict, but it has helped.
That derogatory word “globalization” has created opportunity in areas where hope was nonexistent, helped people to have a better standard of living and education, helped nations have a better cultural understanding of other countries, and has bridged gaps in foreign relations for many nations. How people can say that globalization is “bad”, seems like people calling rock’n’roll music “the devil’s music” decades ago. Maybe now that we have a little better picture of what globalization can do for us and the rest of the world, fewer people will oppose it and will stop viewing it so negatively as they understand it more.