What is globalization?

Globalization derives from the word globalize which means for something i.e. businesses to operate around the world; therefore globalization is the means of operating around the world. In this essay I shall clearly state what globalisation is by looking at the many aspects of globalization, what impact organisations have in context with globalisation, what impact globalisation has on the world and also look at the advantages and disadvantages of globalization. I shall also look at a case study on globalisation and try to explain how globalisation works.

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Globalization can be seen on many different levels. The levels that it is most important are on an Economic level, Political level, Technical level, Social level, Legal level and an Environmental level. These levels at where globalization exists have many different ideologies based upon different theories and understandings of globalization. Globalizations main feature is expansion i.e. expansion of the economy worldwide, expansion of technology around the world even expansion of political ideas. Although expansion is a major feature of globalization it can also cause markets to become stagnant due to monopolistic markets such as supermarkets. ‘Globalization refers to the widening and deepening of the international flow of trade, capital, technology and information within a single integrated global market’ (Petras and Veltmeyer 2001)

Globalization at an economical level is highly considered to be a ‘true’ meaning of globalisation. At this level the main aspects that are obvious are such things as the stock markets, money, finance and many more however, even these being major aspects of economical globalization other factors that can also be considered such as production and marketing of products and services. The production and marketing of products talking from buying clothing to government bonds either it is an injection into the economy, allowing it to circulate more money resulting in the growth of the economy. The process that it describes, and which has gathered momentum since the 1970’s, is dominated by economic considerations and developments’ (Panic 2003)

Politics itself is globalized and therefore, an example of globalization. Politics play a major part everywhere in the world as politics controls substantially everything. Within this politics level would be organisations such as the United Nation and international law. Another part of the political level is the choices that governments of countries may make for example Tony Blair(former prime minister of the labour government in England) agreeing to go to war in Iraq with George W Bush (president of the USA)

The legal level of globalisation is difficult to define as different countries and different areas of a country all have different laws according to their preference therefore this can also be called Glocalization. Glocalization is simply means how the global markets are related to local preferences. Law itself works on many levels such as an international level to regional level to even inside a single organisation. Globalisation of legalities would cover such things as the Data Protection Act which is a universal law that information held on you must be accurate, up to date and complete.

‘Apparent paradox of the relation between global markets and processes, and local needs and nodes’ (Evan and Mooney 2007) This same idea of Glocalization can also be applied to the technical and environmental levels of globalization as each aspect depends upon their location. For example technology is universal however, how it is applied depends on where you are located i.e. three pin plug in the UK and two pin plug in the US but the product, vacuum cleaner, still has the same capabilities.

The social level of globalisation is phenomenal as companies such as Nike, Coca Cola and McDonalds have dominated their markets in such a monopolistic manor that they determine what we as consumers buy rather than the other way round. I believe companies such as Nestle which have been prosecuted for the use of ‘sweat shops’ and same with Nike are companies that are globalized however, have exploited their employees to an extent that globalization has had a negative effect. ‘McDonaldization ‘, is a term created by George Ritzer in his book ‘The McDonaldization of society’ (1993), which simply mean the principles of fast food restaurants are dominating sectors within society. (Evans and Mooney 2007) In addition to the social level are global media, tourism and social intervention via internet such as chat rooms, my space, facebook and many more.

Within the notion of globalization there are both advantages and disadvantages to globalization. The advantages of globalization are the ongoing benefits of the world economy to several countries, businesses etc. The advantage of the world economy is that money, finance, stock shares etc are circulated throughout the economy allowing for economic growth and wealth around the world. Another advantage is the discouragement of war as global relations due to imports and exports promote peaceful living. Other advantages include promotion of democracy and liberal values. The disadvantages are several people are excluded from the world economy, could cause wars/conflict due to monopolistic activities i.e. a particular country in control also another disadvantage would be that it could also make environmental problems worse

Globalization has a massive impact in this world in many different ways, as you can see from the above with the different levels globalization there are many ways it can be an advantage or disadvantage depending on circumstances etc. To show exactly how Globalisation works in a realistic environment if you refer to John Sloman’s book Economics (2006) pp.705. There is a case study on ‘Globalisation and the US Trade Imbalance’. In this case study you can see how globalization works at an economical level. The case study is about the USA’s current account deficit in 2004. It states it was $666 billion up from the previous year of $531 billion.

From the case study it is clear how one country’s finance affects another’s. Also looking at the consequences of the imbalance there was a depreciation of the dollar, interest rates rising in both the USA and China and potentially in the long run an enormous amount of selling the dollar due to the increase in international liquidity ‘Potential currency volatility … further deepening the recession’ (Sloman 2006) . From this case study you notice the ever growing danger of globalization however; if it is controlled then the risks are much less.

In conclusion I can state that Globalization is a worldly phenomenon that can unify countries. It can help to further knowledge of technology, help countries politically and also economically speaking it can benefit most people whether that’s through working in a organisation, owning a privatised organisation or simply having share upon the stock market. Personally I believe globalization is beneficial due to the points stated throughout this essay.