The Truly Global Economy

Introduction Many people have had different questions regarding globalization, some asking whether it is the integration of economic, social, political and cultural systems across the world or the dominance of the developed countries in making decisions at the expense of the poor regions.Advertising We will write a custom essay sample on The Truly Global Economy specifically for you for only $16.05 $11/page Learn More Others have questioned whether it can contribute to the economic growth, prosperity or the democratic freedom or it is a force for devastation of the environment and exploitation of the developing countries. This paper handles what a truly global economy is with emphasis on the consequences of the current economic crisis. Globalization Globalization refers to all aspects that seek to increase not only the connectivity but also the interdependence of the world’s markets. The main factor that has led to the increase in globalization is the technological advancement that allows people to freely move communicate and trade internationally. It is the interconnectedness of production, communication and technologies all over the world. It involves both cultural and economic activities. Additionally, it is said to be such a diverse, deep-rooted force that not even the current massive economic crisis can break it down or permanently destroy it. Many argue that globalization has brought about increased opportunities for everybody in the world, irrespective of their social backgrounds. The rich and poor actively participate in globalization. On the other hand, others who are against globalization claim that it has deprived some people in terms of resources, as they cannot compete with the rest of the world. â€Å"Globalization raises new challenges for governance, especially vis-vis the roles of government, workers, and citizens in the new economic order† (Ashford, 2004, pp.52). The differential success of regulatio n regimes affects the progress of globalization within many nations around the globe. Introduction of global markets has lead to many changes. One of the major changes is the harmonization of principles. This has been a success through the integration of ILO conventions and international environmental agreements. Many nations are reluctant in surrendering their overall autonomy since they are afraid of the possible negative impacts of the possible economic integration. A truly global economy Nations around the world began to globalize their economies towards the end of the eighteenth century as major discoveries on geography started influencing everyday’s business life. During this time, the economic interests as well as the advancements in technologies could not stand to integrate the world’s economies.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Community wars and politi cal instabilities have made the economic integration process and creation of a unified market place more unrealistic. This has caused the world economy to continue with the strengthening of integration. It is also being taken to the oblivion further by the differences in national developments that have proved to be increasing on a daily basis. As far as technology is concerned, many countries are lagging behind and have no characteristics of a global economy. Countries that have large populations and provinces have a continual disparity in terms of economic and technological developments. For instance, in Bangladesh, the large populaces have never made a telephone call. The gap between the rich and the poor continue to widen. However, the companies in different regions and continents have integrated and made it a reality. This does not mean that it is a truly global economy because globalization does not revolve around trade only. Countries such as Myanmar are working hand in hand w ith developed countries causing global economic harmonization. This creates GMP. A truly global economy requires a complete economic integration of the the various aspects of the national economy. Globalization theories Several terms bring out several aspects of the term globalization in different ways and contexts. Globalization has been like an extension of modernization. The instability in capitalism and traditional sovereignty has sparked reaction against reason. According to the World Polity theory, globalization is about culture. By the end of the twentieth century, world culture had crystallized and become part of the world society: a common heritage. Even so, it has not been able to claim global consensus. The main reason behind this is that different communities in different geographical locations differ in their interpretations of some aspects such as the rights each community in globalization. This definitely makes it hard for the world to attain a homogenous state of eco nomy. According to Meyer, â€Å"A polity system is a system of creating value through the collective conferral of authority† (1980, pp. 52). The players in the system happen to be â€Å"entities constructed and motivated by enveloping frames† (Boli and Thomas, 1997, pp.22). This is why the nations have adopted analogous constitutional forms as well as educational systems among others. The international non-governmental organizations also play a big role in world citizenship. Some ample room is created for innovation while in pursuit of similar goals by the states thus causing intense competition. The competition as part of the world’s cultural standards causes reactions that later demands putting things right. This will continue for as long as the world lives.Advertising We will write a custom essay sample on The Truly Global Economy specifically for you for only $16.05 $11/page Learn More Thirdly, there is so much pressure on survi val brought about by the capitalists. According to Robertson â€Å"globalization is the compression of the world and the intensification of consciousness as a whole† (1992, pp.8). By the end of the twentieth century, the world was in chaos as more people were being exposed to the need to live independently in such of sovereignty. According to the World System theory, globalization is a process by which the world’s system eventually becomes harmonized around the globe. It maintains that globalization is not a new phenomenon. Wallerstein argues â€Å"the current ideological celebration of the so-called globalization is in reality the swan song of our historical system† (1998, pp.32). It started with the Europeans whose desire for feudalism provoked technological innovations and developments of market institutions in the quest for production. This made it even easier to reach the other parts of the world. Military strength and a good transportation system made it e asier to establish economic ties with other nations. The peripheral areas provided raw materials while the semi-periphery regions had little if not zero benefit. It reached its geographic limit with the extension of capitalist market. Even with this, there was no way to change the situation because polarization of the system had taken place. Crisis arose that could not be solved by exploitation of new markets and there could never be a more equal or democratic world. The periods of innovation had a negative impact to the economy. Businesses experienced a reduction of profits, an aspect led to not only recession but also economic stagnation. It is clear that even with the theories, globalization actualization in its full capacity is an issue that seems to be at its peak though it is still in the process of winning many participants-nations. The increased economic interaction between different nations has led to the propagation of a different and deep-rooted political change. This has been evident in that most of the poor or rather third world countries have become more dependent of the developed countries for everything. In addition, economic power has shifted from the nation-state to multinational corporations. This is characterized by circulation of technologies, practices as well as ideas. â€Å"The intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa† (Anthony, 1990, pp.64).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More With the current technological advancement, people are in a position to buy goods from the internet. They do not interact with the suppliers or the sellers but can only interact with the delivery personnel. Banking has also facilitated virtual interactions between the parties involved. The other casualties of this kind of a process have been a decline in national governments failure to direct and have an impact in their economies. A good example could be Japan whose economic shifts can be felt in countries all over the entire universe because of the interconnectivity. The lack of influence in the national governments does not mean that they are gone completely but in essence they remain â€Å"pivotal institutions especially in terms of creating the conditions for effective international governance† (Hirst and Thompson, 1996, pp.170). Multinational corporations are literal beneficiaries of globalization. The car manufacturing companies for instance go global in search of the p arts required for the assembling of the same. According to Hirst and Thompson, International businesses are still largely confined to their home territory in terms of their overall business activities, they remain heavily ‘nationally embedded’ and continue to be multinational rather than transnational corporations (1996, pp.98). The impact of this globalization on the local communities is evident. The multinationals can influence local communities in many ways. First, in order for them to operate, they establish operations that include sales and services in the regions that will eventually offer cheap labor and resources as required. This can bring wealth to the areas that the multinationals have elected; for instance, people can choose to work at the plant, on the one hand, or to be unemployment, on the other hand. This is because incase of relocation, the locals who had been offering services as workers would be rendered jobless, and this could be devastating. In most cases, the public spaces like the parks are eroded with their activities. Social places become privatized and commercialized leaving the locals with no social grounds. Everything eventually becomes expensive and inaccessible for the locals. Globalization is well thought-out to be a line in the sphere where the economic world is developing irremediably as well as irreversibly. Financial globalization presents a very high degree of development, especially within the financial markets. Technological changes in communication and data processing have made globalization to be identified as the irrefutable proof of huge capital movement achieved. Nonetheless, a global financial industry has not been established yet. The current financial crisis around the globe is a major barrier to the advancement of the process of globalization especially to the developing nations. Though it has been of great help to not only the developing but also developed countries by alleviating their poverty level s, it is very vulnerable to terrible and costly backlashes, as history has shown. The constantly changing global economy and market are challenges for all nations. The deteriorating economy poses a challenge to issues such as employment, occupational health and safety as well as people’s wages among others. (Ashford 2008, pp. 304). To achieve an affluent global economy, it is necessary for all nations to be aware of their rights to take part in the world trade and use the advantages of the innovations (Ashford 2004). Political and financial instabilities Nothing good comes on a silver platter and to achieve globalization in the vast continent has been a great achievement even with its failures. The failures that have brought about dysfunctional globalization as some view it, has been brought about by political and financial instabilities. Many countries have outstretched to their limits in an attempt to adapt to globalization but ended up being exhausted especially in cases o f financially driven globalization. These mainly are the developing countries whose financial status fails to handle their capital city’s economy and operations. Technical advances are the sole drivers for the upswing that causes many of the institutions to foster ways to adjust with some ending up being poorer than before. Protectionism became a key consequence in many of the countries. This is why the G-20 summit of November 2008 in Washington produced some reverberating denunciations of countries and nations being protective of their possessions. This did not last long before measures regarding protectionism were implemented in many of the countries like China. This at some point brought about a misconception of the end of globalization because globalization is not just about international trade and investment, which the countries were shielding. It is true that trade has plunged and financial flows drastically fallen and to some extent may not recover any time soon unless the main economic pillars are reignited. Although international trade plays a pivotal role in globalization, there other factors that are essential in enhancing the full realization of the process in developing an affluent global economy. Ways in which people are still connecting despite economic crisis All over the world, people are still connecting despite economical crisis threatening the countries. Internet connectivity is a key boost in the advancement of the great relationships among the people in the world. Social sites, like MySpace, Twitter, Facebook, have enabled communication to be cheaper and accessible even in the most of the remote areas one can ever think of. People from North islands can relate with people from Africa. E-bay also allows people to transact irrespective of their geographical locations. Their international activities could be bolstered regardless the current economic crisis. As witnessed all over the world, the global charities might bring people toget her in one way or another. This is so because many countries are in need and none seems to be isolated to live on its own without ever mingling with the others. Amazingly enough, the ability of a national government to protect its economy and society from outside influences has no strong roots recently. The current wave of globalization has proven to have unprecedented impacts, and this explains the reason why it is hard to tame and curb external influences. The internet allows Vietnam to trade their handicrafts in Europe without travelling there. The cultural, political, social, economic as well as military components have been quantified, so it is a matter of time before a qualitative change takes place. Nevertheless, even with the financial crisis still going on, nations from all over the world are interconnected. Globalization has multiplied the number of problems that have made it hard for any country to solve them on its own. These problems include such issues as financial pro blems, climate changes, terrorism that has interconnected the East African countries with America in one way or another to curb the menace. Pandemics like HIV/AIDS have brought together countries looking for cure, nuclear proliferations, among others. With the current global crisis, global governance will increase respectively. Countries in East and Central Africa have signed partnership deals to enable them to transport and export their products like oil through Kenya from South Sudan. Factors affecting globalization One of the major factors that affect globalization is the barriers associated with immigration. Some countries have imposed trade-impairing policies besides taking strict measures to curb immigration. Such an approach will work for a while, but the financial support will fail after a while. The world culture theory also called the Homogenism theory acts in unison with these findings concerning globalization being there no matter what happens. The theory marks differenc es in cultural homogenization and sees globalization broadly being the increasing uniformity of cultures all over the world, instead of just viewing it from an economical perspective. Transformational theory is handled in these findings as well. The theory focuses on the global forces that increase the powers of the nation-state. It maintains thinking globally as people or nations act locally, as well as maintaining diversity in the face of economic forces that encourage uniformity. Conclusion In conclusion, globalization presents both the opportunities and risks to every nation that indulges in it, especially the African nations. In most developing countries especially those in Africa, globalization presents certain risks. For instance, one of the possible impacts of globalization is the increase in political costs as well as the social tensions that come with (Ikeme 1999). Owing to this, the economic state of most developing nations may end up being strained to levels beyond their abilities or rather resources. This translates to economic redundancy in such nations, which will have a negative impact on the global economy as well. It is no doubt that globalization has tremendous potential benefits for any developing country. The bigest â€Å"challenge is to realize the potential benefits without incurring huge offsetting costs in loss of the ecological basis for development and in the increase of inequality and impoverishment of the public† (Ikeme 1999). Developing country should, therefore cease to see globalization as a result but as a means to the end. The end is sustainable wellbeing for everyone. The chance is created by the opportunity that the fender-bender of the two approaches towards globalization and sustainable progress will cause a new stage of human development, â€Å"which offers up-to-the-minute opportunities for the re-negotiation, and re-juggling of the world economic configuration† (Ikeme 1999). Both the developing and develop ed nations have equal opportunities to participate in the globalization of the word’s economy. However, their contribution is dictated by their economic stability. To do this, they must set free from all the stereotypes on frameworks for development that the Western powers have created in favor of their origin. To be competitive in the global economy, the nations should invest their natural capital in their economy. They should also train their locals and ensure that foreigner does not have too big share in the development of their economy. Thus, making sure that local companies are owned by the locals themselves ensures that profits are reinvested in the country as well as innovations in technology are never imported but developed in their own homeland. Following this way, they will make quick leaps in attaining the global goal and they will benefit from it just like the rest of the developed countries. Globalization is to stay and the countries that will be the most success ful in the next near future will be the ready to take all the obligatory informed decisions of their endeavors and in light of their goals irrespective of the misinformed guidance from the development experts. The so-called experts and giants in the economy have little business in enhancing the locals of other nations to remain superior and relevant. However, once the rest take up the task upon them to educate and take their country to the next level, the superiors will have no business with it. Unless this hard but fruitful task is yoked in the locals of the developing countries, the economic giants will always mingle in their affairs with no tangible returns witnessed. They should engage the global economy on the own terms and not using the preset order by the developed country. Until then, they will always have a way to elude them. Reference List Ashford, NA 2004, â€Å"Sustainable Development and Globalization: New Challenges and Opportunities for Work Organization†, in C Nova-Kaltsouni M Kassotakis (eds.) Promoting New Forms of Work Organization and Other Cooperative Arrangements for Competitiveness and Employability, National and Kapodistrian University of Athens, Athens, pp. 50-61. Ashford, NA 2008, â€Å"Environmental Regulation, Globalization, and Innovation,† in KP Gallagher (ed.), Handbook on Trade and the Environment, Chettendam and Northampton, Virginia, USA, pp. 296-307. Boli, J. and Thomas, G., 1997. World Culture in the World Polity. American Sociological Review, 62(2), pp.171-190. Ikeme, J 1999, ‘Sustainable development, globalisation and Africa: Plugging the holes’, Africa Economic Analysis. Web. Hirst, P Thompson, G 1996, Globalization in question: The international economy Meyer, W., Boli, J., Thomas, G. and Francisco O., 1997. World Society and the Nation-State. American Journal of Sociology, 103(1), pp.144-181. Robertson, R., 1992. Globalization: Social Theory and Global Culture. London: Sage. Wallerstein, I. , 1998. Utopistics: Or, Historical Choices of the Twenty-First Century. New York: The New Press. This essay on The Truly Global Economy was written and submitted by user Jenna T. to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.