Globalization Benefits World Economies
There is a consensus among economists that globalization provides a net benefit to nations around the world and therefore should be embraced on the whole by governments and individuals. Some of the benefits of globalization include:
1. Foreign Direct Investment
Foreign direct investment (FDI) tends to increase at a much greater rate than the growth in world trade, helping boost technology transfer, industrial restructuring, and the growth of global companies.
2. Technological Innovation
Increased competition from globalization helps stimulate new technology development, particularly with the growth in FDI, which helps improve economic output by making processes more efficient.
3. Economies of Scale
Globalization enables large companies to realize economies of scale that reduce costs and prices, which in turn supports further economic growth, although this can hurt many small businesses attempting to compete domestically.
1. Interdependence
Globalization leads to the interdependence between nations, which could cause regional or global instabilities if local economic fluctuations end up impacting a large number of countries relying on them.
2. National Sovereignty
Some see the rise of nation-states, multinational or global firms and other international organizations as a threat to sovereignty. Ultimately, this could cause some leaders to become nationalistic or xenophobic.
3. Equity Distribution
The benefits of globalization can be unfairly skewed towards rich nations or individuals, creating greater inequalities and leading to potential conflicts both nationally and internationally as a result.
Although there are a few drawbacks to globalization, but most economists agree that it's a force that's both unstoppable and net beneficial to the world economy.
Edited by: 浪子
Bibliography
Justin Kuepper. (2018). The Impact Of Globalization On Economic Growth. Retrieved from
https://www.thebalance.com/globalization-and-its-impact-on-economic-growth-1978843
The Impact of Globalization on Economic Growth
Reviewed by 浪子
on
September 14, 2018
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Reviewed by 浪子
on
September 14, 2018
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