Globalisation has become a definition primarily linked to its impact on economic growth, income inequality, and its effect on employment whereby Uchitelle (2005 p.3, as cited in Elijah, 2007) regards the concept a “rootless process of constantly moving jobs to low-wage countries”. Other authors (preble, 2010; Lee & Vivarelli, 2006) relate the term with economic integration and trade liberalisation.
Although globalisation has many aspects, this paper will narrow itself to the review of literature regarding the pros and cons of globalisation on employment in developing countries. Even though globalisation has its drawbacks, it has a positive effect on employment in developing countries.
First, a brief history of globalisation is presented, focussing on the present era in particular. Next, the positive attributes will be presented, followed by statements made by opponents of globalisation. Thereafter, the two main topics of trade liberalisation and foreign direct investment are introduced. These topics have had an impact on employment, especially in developing countries. To conclude, specific aspects of globalisation are linked to employment in developing countries.
The history of globalisation
Globalisation has been associated with three main eras throughout the last century, whereby many facets contributing towards a gradual integration of economies (Gunter & Van der Hoeven, 2004) were hampered by global happenings (Preble, 2010). The first era was highlighted by trade and was projected to increase further. However, the arrival of World War I ensured trade protectionism and reprisal (Elliot, 2006, as cited in Preble, 2010). After the war, economies were starting to integrate and many factors, including the establishment of the...
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...come inequality has increased amongst the employed (Gunter & Van der Hoeven, 2004; Preble, 2010).
Even though globalisation has some negative impacts on society, Preble (2010) believes that people should be better informed regarding the benefits of globalisation. In addition, globalisation has its advantages for most countries (Bergsten, 2000, as cited in Preble, 2010) and hence, supports Preble’s recommendation to increase awareness of the positive aspects globalisation. The following section goes more into detail regarding the effect of globalisation on employment, focussing on developing countries in particular. Two main areas have impacted employment in developing countries, namely trade liberalisations and FDI. Both have contributed towards a changing working environment, especially in the current era were economies are integrating and borders are opening up.
Globalisation, in the simplest sense, is economic integration between countries and is represented by the fact that national resources are now becoming mobile in the international market. Globalisation sees: an increase in trade of goods & services through the reduction of trade barriers; an increase in financial flows through the deregulation of financial institutions and markets and floating of currency; an increase in labour
Globalisation is a worldwide movement towards economic, trade, financial and communications integration (“Business Dictionary,” 2013). This would allow firms to operate on a multinational level, previously being restricted to local communities as their target market. Taking advantage of different factors of production abundances in multiple countries. An important aspect to globilisation is trade liberilisation, which is the removal or reduction of trade barriers on the free exchange of goods between nations (“Investopedia,” n.d). These barriers can include tariffs and quotas as well as non tariff obstacles such as licensing rules (“Investopedia,” n.d). Removing such barriers allows international trade occur easier and countries are able to put to practice the comparative advantage aspect in relation to other economies.
These results change or modify political organizations to be suitable for the needs of global capital. Regions and nations are encouraged to import and export of goods from other parts of the world rather than supplying or manufacturing them in their own homeland. Thus, seeking expensive manufactured supplies or goods from third world countries to import them to the first world corporation’s injunction with the free trade zones of globalization (Ravelli and Webber, 2015). These negotiations raises new organizations, for example, the World Trade Organization (WTO) to aid and supervise both countries to for a legalized trade. However, Neoliberalism amplifies the negative aspects of globalization’s effect on the economy. For example, deregulation, decrease of government benefits, and tax modifications (Bunjun, 2014). Nevertheless, relating these negative aspects to the documentary Made in L.A. (Carracedo, 2007) which is the main issue of increased risk of employment for both the first world and third world countries. In regards to, a switch from full time stable and secure jobs to part time unstable and insecure jobs. This reduces career growth for many employees, which they recognize, and thus switch jobs – where as they may not fit as well (Bunjun, 2014). As a result, globalization causes market inefficiency via labor market segregation and exploitation, unemployment and underemployment, unequal access to employment (Bunjun,
We say that we are heading toward a more global economy because of the fact that competition in today’s markets is global. This means that corporations in the United States can compete in foreign markets and vice versa, therefore U.S. corporations and foreign corporations become interdependent and thrive off each other. This can have a good impact on the United States because it allows U.S. corporations to seek materials and labor outside of the U.S. in countries such as China, India, and Mexico, where workers are paid a lot less money than U.S. workers, thus allowing them to sell their products for significantly cheaper than if they were produced in the U.S.; however, the tradeoff is that many American workers in the industrial sector lose jobs due to this shift of labor to overseas. In the long run this will be beneficial for the U.S. and although some percentage of workers are losing work, new jobs in the services sector, in fields such as computer technology, telecommunications, and language skills are opening up and experiencing growth because of this change.
“Globalisation” is an old process that started way before the 20th century. In fact, the first signs of globalisation appeared with the first merchants that used to travel from a country to an another to buy and sell theirs goods. But “globalisation...
When the term “Globalization” is discussed, most academics, scholars, professionals and intellectuals attempt to define and interpret it in a summarized fashion. My main concern with this approach is that one cannot and should not define a process that altered decades of history and continues to, in less than 30 words. Global Shift is a book with remarkable insight. Peter Dicken rather than attempting to define the commonly misused word, explains Globalization in a clear and logical fashion, which interconnects numerous views. Dicken takes full advantage of his position to write and identify the imperative changes of political, economic, social, and technological dimensions of globalization.
The development of free-market economics has, since the 18th century, resulted in the spread of a set of ideas, creeds and practices all over the developed and much of the developing world. Today, the globalisation of trade, capital, technology and innovation has accelerated competitive conditions for businesses all over the world. Globalisation may be defined as the opening of markets to the forces of neoliberalism and capitalism; it is characterised by the free movement of people, talent, skills, capital (intellectual, social and economic) across international borders. All kinds of barriers have either been swept away, diffused or made obsolete by the forces of globalisation: trade barriers, subsidies, geographical boundaries, linguistic and cultural differences. Technological advancements have pulled the world closer and, in the process, affected how labour relations and worker/employer relations operate and develop. The multinational corporation as well as the public sector alike are affected by global competition.
In this essay I will give a detailed explanation of what sociologists mean by the term ‘globalisation’ and how they have tried to explain it.
By the 1980’s, Connell claims, that the term globalisation was coined by ‘business journalists and management theorist’ (2007:370). Sociologists picked up the term and two directions of globalisation surfaced; economical and societal approaches. Globalisation was soon recognised as factual and it wasn’t until ‘Bartelson (2000) rightly called attention to this as a problem’ (Connell:2007:370). This created a new debate of globalisation vs.
Labor laws, wage disparities, intense competition and fluctuating currency values are the challenges that are making organizations worldwide to compete in marketplace with products requiring a great deal of labor, and it is now getting harder for some of these organizations to maintain employees abroad. As Mello (p. 610) mentioned that a greater percentage of United States workforces are moving their operations abroad to developing nations like China and leaving an increasing number of United States domestic workers without employment. The foreign markets for the products and services are not the only things enticing these organizations to enter these global marketplaces. There are other reasons these companies are joining the global market arenas. For example, the foreign labor markets, this has attracted interest in many organizations to expand globally (Gersten, 1991). The labor force growth rates in developing nations alone will continue expanding by approximately 700 million people by the year 2010, while the United States labor force will continue to grow by only 25 million. This shows that United States’ growth rate will drop and the opportunities for productivity growth rate will increase in developing countries.
An outstanding mechanism frequently used to interpret ‘Globalization’ is the ‘World Economy’. Back to the colonial age, the coinstantaneous behaviors of worldwide capitals and energy resources flowed from colonies to western countries has been regarded as the rudiment of the economic geography (Jürgen and Niles, 2005). Nowadays, the global economy was dominated by transnational corporations and banking institutions mostly located in developed countries. However, it is apparently that countries with higher level of comprehensive national strength are eager for a bigger market to dump surplus domestic produce and allocate energy resources in a global scale, thus leads to a world economic integration. This module was supported by several historical globalists (Paul Hirst, Grahame Thompson and Deepak Nayyer) ‘their position is that globalization is nothing new but more fashionable and exaggerate, a tremendous amount of internationalization of money and trade in earlier periods is hardly less than today.’ (Frans J Schuurman 2001:64).
Globalisation goes back as far as the era before the First World War. During that time globalisation’s general tendencies produced a very uneven pattern of global economic development, exposing the limits of global economic integration. For example, the integration of the African economy into the capitalist economy is part of the globalising tendencies of capitalism.
Globalization affects this world and the people of this world in many ways. It is the idea of making the entire world like a single country.
On the other hand, opponents question if the benefits of globalization compensate the created downsides. In their opinion, globalization has manifested unemployment, poverty and marginalization. Additionally, it has been one of the key drivers ...
Globalisation is a very complex term with various definitions, in business terms, “globalization describes the increasingly global nature of markets, the tendency for transnational businesses to configure their business activities on a worldwide basis, and to co-ordinate and integrate their strategies and operations across national boundaries” (Stonehouse, Campbell, Hamill and Purdie, 2004, p. 5).