Social Sciences, asked by chinmayireddyganga, 1 year ago

what are the advantages and disadvantages of foreign trade and integration of market an idea of globalisation ?

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Answered by PrinceJK786
1
Globalization refers to the interaction of one economy with all the other economies of the world. This interaction can be in terms of financial transactions, trade, politics,education, production etc. Globalization picked up steam with the invention of newer and newer technologies in the world of transportation and communication. Thus, it can be seen that though globalization is traced back to ancient times by historians, it truly began at the end of the 19th and beginning of the 20th century. The term Globalization, in its newest form, has four major parameters:

Free flow of goods and services between countries due to the reduction in trade barriers.

Creation of an environment for flow of capital and investment among countries.

Free flow of technology from one country to another.

Free movement of labor among countries.

True globalization is attainable only if all four components are present. However, globalization has some advantages and some disadvantages. Some of these advantages and disadvantages are:

Advantages:

· Increase in employment opportunities: As globalization increases, more and more companies are setting up businesses in other countries. This in turn increases the employment opportunities that people atone place have. People can get better jobs without having to move to other countries in search of better jobs. Today, many multinational companies such as Microsoft, Google and Toyota etc. have their offices in India and many Indians work for these companies in India. Without globalization, Indian people would not have had the opportunity to work for such companies in India.

· Education: With the increase in globalization, it has become easier for people to move across borders to different parts of the world to acquire better education. This has resulted in an integration of cultures. People from underdeveloped and developing countries often move to developed countries to get better education. More and more Indian students are traveling to countries like the UK or the USA to pursue higher education. This has also opened their cultures towards the Indian culture to some extent.

· Increase in free trade: An increase in free trade has opened doors for investors in developed countries to invest their money in developing countries. Big companies from developed countries have the freedom to operate in developing countries. In the 2000s, Japanese and European companies such as Kawasaki and Siemens started producing high-speed trains in China. This helped Chinese firms in gaining knowledge about the production process and now Chinese companies such as China South Locomotive & Rolling Stock Corp. are producing high-speed trains on their own.

· Faster flow of Information: Information flows from one part of the world to the other immediately, resulting in the world being tied together. Vital information can be shared between individuals and corporations at a very fast rate. It has also facilitated in increasing the ease of transporting people and goods.

· Increase in quality of goods and services: As a result of globalization, people have access to the best quality of goods and services throughout the world. Companies have to strive to provide better quality goods and services to the consumer and the consumer has the liberty of choosing whichever product he thinks is best suited for his needs. This allows a person in America to wear clothes made in India and Mexico while watching a football match taking place in England on a TV made in China.

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