International Management - Assignment Example

Globalization refers to the integration of people, their economic activity and culture into a global relationship. When an individual defines the term globalization, he gives it an economic aspect which refers to the worldwide distribution of goods and services through minimization of international trade barriers such as import quotas, export fees and removal of restrictions on movement of capital for investments. Globalization through the principles of specialization and comparative advantage has contributed for the growth of developing and developed countries, and therefore it is a welcome phenomenon. Globalization also refers to the worldwide interaction of popular culture, language and circulation of ideas (Foe, 2004). There are three types of globalization, namely modern, proto and archaic globalization. Archaic globalization is characterized by the rise of Sumer and Indus valley civilization in the third millennium while proto globalization is characterized by the maritime European empires of the 16th and 17th century such as Portugal. Modern globalization is characterized by the end of the First World War to the present period. The American economy has grown greatly in the past decade through the importation of its services and goods to other states of the world. Due to globalization, the American state has enormous influence in the world affairs determining trade, and security operations at the global sphere. Due to the influence of America at the global arena, globalization was coined to refer to as Americanization because other countries in the world adjusted to American values and their culture, and an example is American influence to socialist states to enact capitalism. In the current century, there is a change in the aspects of globalization. This is because of the economic crises that hit America and the emergence of China and India as powerful economic forces in Asia. However, India and China cannot misplace America as a dominant player in world affairs, but their influence is felt only in trade which involves competition of their products with those of the Americans. This paper analyzes the impact of globalization in respect to USA, India and China. Between 1995 and 2007, the economic aspect of globalization increased significantly due to the liberalization of the world’s economies. For example in China, their economic reforms opened the country to globalization starting from the period 1980s. China experienced an influx of foreign goods and services in every sector of its economy, and this made the country’s economy to grow. Foreign investments, specifically in the heavy industry made the country experience quality, growth, knowledge and improvement of the standards of the services offered in the country. Basing on this, this paper will highlight the impact of globalization to the Chinese. In India, the ongoing economic liberalization has opened the country to economic growth due to foreign investments arising out of the influences of globalization. These initiatives started in 1991 and currently, the Indian economy has experienced growth in nearly all the sectors of its economy, including the service and the goods sector, with Business Process Outsourcing (BPO) being the major employer of Indians. The BPO contributes significantly to the country’s GDP by alleviating the levels of poverty in the state and by decreasing unemployment (Mazumdar and Sarkar, 2010). In respect to this, this paper will analyze the impact of globalization in India. In analyzing the impacts of globalization in America, China and India, this paper will identify issues such as trade and transactions, dissemination of knowledge and technology, migration and movement of people and capital and investment movements. By use of such analysis, this paper will answer the crucial question that defines globalization. Does globalization have a positive influence on the World’s economy? These three countries will be a case study. America representing the developed World while China and India representing the developing world. Of the developed world, United States of America is the most affected in relation to globalization. The introduction of globalization in America is attributed to the industrial revolution experienced in the country and their impact has been great on the American influence to developed and developing countries of the world. Due to globalization, the countries industries have changed the way they conduct their businesses by opening branches worldwide therefore accelerating the growth of the American industry, economy and the welfare of its citizens (Haugen, 2010). The currency system as an aspect of globalization affects the way American companies are conducting their businesses. This is because of the export and import trade which relies heavily on foreign currencies while trading with countries such as India and China, where companies in America get market for their products. The emergence of Multinational organizations in America has contributed to acquisition of knowledge by employees of these companies through discovery of new markets and ways of marketing their products due to competition from rival companies. Due to fierce competition brought about by liberalization of the American and the world’s economy (Hall and Hall, 1990). American institutions and companies have developed numerous technological innovations to give them an edge over their competitors. All this are possible because of globalization. In as much as globalization contributed to the growth of American economy, it has contributed to its decline. The financial crises of 2008 which arose out of poor planning and overspending of American resources overseas led to the decline and collapse of American companies such as the Lehman Brothers. It has also led to the increase of inequality among the Americans leading to the evolution of the class system, inequitable distribution of justice and increased crime levels. In India, globalization has also played an important role in developing its economy. Companies such as Uniliver and P&G have made entry into the country and this has resulted in creation of employment opportunities leading to reduction of poverty. Indian companies have also expanded their operations worldwide, resulting into the growth of the Indian economy through plowing back of profits made by these companies into the economy and taxation (Singh, 2010). The following are just but a few of the benefits India has reaped from globalization. The expansion of higher academic institutions in India to tap into the growing number of overseas students, and an expansion of its music industry through collaboration with other foreign agencies, and its social media has become vibrant because of globalization (Steel, 2010). A negative impact of globalization in India is child labor initiated by multi-national organizations; however these organizations present an opportunity to their employees to utilize their potential. China has enormously benefited from globalization. Through globalization, Chinese companies such as Dong Pheng, Sinopec, and China mobiles have expanded their operations and captured large international markets like in South Africa, Brazil and India. The social impacts of globalizations are widespread in China and the poverty level in urban areas has dropped from 30% in 1978 to 3% in the 21st century (Guthrie, 2009). Major cities like Beijing and Shanghai have been transformed into the most developed cities of the world (Guthrie, 2009). Globalization has improved the labor relations in China and Multi-National Corporations have opened branches in China seeking labor and markets for their products. Chinese employees have been able to achieve top executive positions in these enterprises (Hall, 1990). In conclusion, globalization is a positive phenomenon which has enhanced the spread of liberalization and capitalism leading to growth of material wealth to nations, individuals and corporate organizations. In globalization, there is the term global village emerged and it means integration of people, institutions into a shared objective. India and China have an objective of economic growth and the only way to attain this is through liberalization of their economies as this will attract foreign investments. These countries encourage their institutions to engage in foreign trade by trading with other nations and opening offices worldwide. The same can be said of United States of America which seeks trade with other countries, especially in Asia. Critics of globalization point a dim picture of this aspect. They claim that globalization erodes the sovereignty of states. This is not true because countries which have embraced this aspect of globalization are sovereign by all definitions. For example China takes care of its domestic and foreign policies without any interference from other countries. India is also a sovereign state, formulating and implementing its domestic policies without interference from other states, and therefore notion of globalization eroding the much valued states sovereignty is uncalled for. Countries which have not embraced this aspect are suffering the consequences. North Korea has closed its economy from liberalization resulting into poverty of its citizens and of the state. Bibliography Foer, F. (2004). How soccer explains the world: an unlikely theory of globalization. New York: HarperCollins. Guthrie, D. (2009). China and globalization: the social, economic and political transformation of Chinese society (Rev. ed.). New York: Routledge. Hall, E. T., & Hall, M. R. (1990). Understanding cultural differences. Yarmouth, Me.: Intercultural Press. Hao, Y., Wei, C. X., & Dittmer, L. (2009). Challenges to Chinese foreign policy: diplomacy, globalization, and the next world power. Lexington, Ky.: University Press of Kentucky. Haugen, D. M., & Mach, R. (2010). Globalization. Detroit: Greenhaven Press. Mazumdar, D., & Sarkar, S. (2008). Globalization, labor markets and inequality in India. London: Routledge ;. Nayar, B. R. (2007). Globalization and politics in India. New Delhi: Oxford University Press. Sjursen, K. (2000). Globalization. Bronx, N.Y.: H.W. Wilson Co.. Singh, A. (2010). Contemporary perspectives on globalisation and migration. Delhi: Kamla-Raj Enterprises. Top of Form Steel, Piers, Taras, Vas, & Kirkman, B L. (2010). Examining the Impact of Culture’s Consequences: A Three-Decade, Multi-Level, Meta-Analytic Review of Hofstede‟s Cultural Value Dimensions. American Psychological Association (APA). https://dspace.ucalgary.ca/bitstream/1880/47917/1/Steel_JAppliedPsych_2010_Postpint.pdf. Top of Form Top of Form Top of Form Top of Form Top of Form Top of Form 1Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Read More