The Globalization Movement and Its Impact in the Economy - Coursework Example

There have been many movements throughout human history that have impacted the economy. In the middle ages the Europeans settlers moved across the world to find new lands and natural resources to exploit. Back in the 19th century the industrial revolution changed the way society produced the goods people used in their homes. In the 20th century an economic movement that changed the relations among nations forever was the globalization movement. Globalization can be defined as the process of expanding economic relationships and integrating economic fortunes across defined political borders (Gabriel, 2000). The purpose of this paper is to discuss the globalization movement and its impact in the economy. The globalization movement began after the end of World War II. Multinational companies began to expand its horizons into foreign territories. The arrival of large corporations into international land created many job opportunities and revenues streams for foreign countries. As more industrial activity began to appear, so did the need to be able to trade these goods across national boundaries. In the past protectionism was widely used among nations. Protectionism refers to the practice of placing barriers to limit trade activity (Hirschey, 2006). Once the globalization movement arrived many countries loosen up their policies and move towards a free trade market. Different alliances and treaties were created to foster free trade. The United States formed a free trade zone established in 1994 called NAFTA. The NAFTA is a free trade treaty agreement between the United States, Canada and Mexico (Usda, 2009). The formation of the European Union represents another free trade agreement. In Europe the formation of the European Union which used the Euro as its common currency increased the level of trade among participating countries. Globalization has also helped many developing countries improve their economies through mechanisms such as technology transfers. A multinational company that has positively influenced the lives of poor communities is Starbucks Café. This firm has help poor farming communities by utilizing fair trade coffee practices that ensure farmers receive over $1.26 per pound which is double the going rate. Despite the benefits globalization brings there are negative aspects associated with the movement. In Egypt, a country currently battling for democracy, non-profit organizations such as the LAND human rights center are opposed to globalization. The LAND visualizes globalization as the cause of the pressure that is driving small farmers from their farms and endangering Egyptian food self-sufficiency (Richard, 2010). The view of this organization must be taken seriously due to the fact that globalization does affect the prices of food worldwide. In communities with limited resources the exports of items such as food affect the local supply of such items. If the farmers of a country receive better offers for their product they have a greater incentive to sell to foreigners instead of keeping the locally produced food for the consumer of their region. Another glaring problem associated with globalization is environmental protection. Humans have been exploiting our natural resources at an accelerated pace since the globalization movement began. The deforestation of our planet has reached a critical stage in our history. New problems associated with the globalization movement have surged such as global warming. The United States is currently in a war that seems to be driven by the desire to control the petroleum in the Middle East. Due to the pressures of the globalization movement gas prices reached an all time high in the summer of 2008 of $146 a barrel (Palnau, 2008). At that price the liter of gasoline was well above a $1 per liter. The accelerated growth of the population during the 20th century along with the impact of globalization has created scarcity of our most important resources which are water and food. According to Germain (2010) president Obama must enact local policies that contradict the logistics of globalization. Globalization has helped improved the traffic of people across national boundaries. Small territories such as Cook Islands have benefited from globalization because their regions have received lots of tourism dollars due to the higher levels of exposure (Wendy, 2010). The world is currently living in the economic cycle known as the Broadband Age. During the 20th century the different advances in telecommunications starting with the telegraph led to the spread of globalization (Wenzlhuemer, 2010). In this new era information moves fast and the internet is the medium that interconnects people across the world. This has allowed a greater integration among cultures. People are getting involved in many social causes in the 21st century because they have more information about other societies. Global tourism has grown and it will continue to grow as we move forward. The demand for airlines services is expected to increase by 75% by the year 2030 (Flynextgen, 2010). Two organizations at the forefront of the globalization movement are the United Nations and the World Trade Organization (WTO). The United Nation was founded in 1945. Its mission is to maintain international peace and security, developing friendly relationship among nations, and promote social progress, better living standards, and human rights (Un, 2010). In order for globalization to work countries have to be at peace. An example of a conflict that is hurting the ability of two nations doing business with each other is the US embargo on Cuba. The World Trade Organization deals with the rules of trade between nations at a global level (Wto, 2010). The acceptance of China into the WTO in 2003 helped many multinational corporations around the world penetrate the Chinese marketplace. The WTO obligated China to eliminate the constraint of being obligated to utilized joint ventures with China firms as the only mode of entry. With the exception of China the globalization movement has led to massive transitions from centralized economy to market economy (Giorgiana & Marieta & Gabriel, 2010). Globalization affects all types of industries including the sporting industry. The arrival of the globalization movement changed the ways professional sporting teams market themselves due to the fact many of them have become global icons. A sport that experienced incredible growth outside its founding region of England is cricket. India is country that loved its cricket, so much so that the Indian cricket league is currently worth upwards of a $1 billion (For the Sport of it, 2010). In the United States the four major sporting league have greatly benefit from the globalization movement because they have been able to expand its fan base and as a consequence have increased the overall revenues of each league. The world has become more interdependent on each country with the arrival of the globalization movement. Globalization has helped reduced the cultural barriers that used to divide our planet. It allowed the economies of different nations to connect in trade of goods and services. Both developed and developing nations benefit from globalization. The power and influence of the movement allowed nations that were formally separated from world such as China to thrive. China became the world’s largest manufacturer of consumer goods due to the globalization movement. Developing nations with mature and sophisticated markets such as the United States have been able to expand their operations into international locations. The emerging economies of developing nations are places were the US can export its goods and services. It has become obvious that in the 21st century globalization will continue to affect the global economy. The richer nations need to increase their investment in the emerging economies so that more of these countries can become develop nations. A potential future study associated with globalization could be based on how much involvement is needed from the developed nations in order to eradicate poverty and hunger in the regions in greatest need. References Flynextgen.com (2010). FAA: Passenger Demand to Jump 75%, air cargo to nearly triple by 2030. Retrieved April 12, 2010 from http://blog.flynextgen.com/2010/03/09/faa-passenger-demand-to-jump-75-air-cargo-to-nearly-triple-by-2030/ For the Sport of it (2010). BizEd, 9(1). 72. Retrieved April 12, 2010 from EBSCOhost database. Gabriel, S. (2000). Globalization. A Corporate Finance Perspective. Mount Holyoke College. Retrieved April 14, 2010 from http://www.mtholyoke.edu/courses/sgabriel/globalization.html Germain, F. (2010). “Presidents of Color” Socialization and Social Inequality. Journal of Black Studies, 40(3). 445. Retrieved April 12, 2010 from EBSCOhost database. Giorgiana, M., Marieta, S., Loan, M. (2010). The Transports and the Globalization Process. Revista Academiei Fortelor Terestre, 15(1). 62. Retrieved April 12, 2010 from EBSCOhost database. Hirschey, M. (2006). Economics for Managers (India Edition). Australia: Thomson. Palnau, G. (2008). MPSC Issues Winter 2008/2009 Energy Appraisal. Public Service Commision Energy, Labor, & Economic Growth. Retrieved April 13, 2010 from http://www.michigan.gov/mpsc/0,1607,7-159-15038-200836--,00.html Richards, S. (2010). Getting a grip on democracy. New Internationalist. Retrieved April 12, 2010 from EBSCOhost database. Un.org (2010). UN at Glance. United Nations. Retrieved April 12, 2010 from http://www.un.org/en/aboutun/index.shtml Usda.gov (2010). North American Free Trade Agreement. Retrieved April 14, 2010 from http://www.fas.usda.gov/itp/Policy/NAFTA/nafta.asp Wendy, C. (2010). Dancing from the Heart: Movement, Gender, and Cook Islands Globalization. Oceania, 80(1). 121. Retrieved April 12, 2010 from EBSCOhost database. Wenzlhuemer, R. (2010). Editorial – Telecommunication in the Nineteenth Century. Historical Social Research, 35(1). Retrieved April 12, 2010 from EBSCOhost database. Wto.org (2010). What is the World Trade Organization? World Trade Organization. Retrieved April 12, 2010 from http://www.wto.org/english/thewto_e/whatis_e/tif_e/fact1_e.htm Read More