Globalisation

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Описание

Today the world lives in an epoch of incredible changes. Many years ago local economic systems have been replaced by national economies. The XX-th century was century of the branches based on use of natural resources (a steel, grain, and oil). The XXI-st century becomes century of that some researchers name "artificial intellectual technologies" which concern micro-economics, biotechnology, telecommunications, hi-tech technologies, robots.

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Introduction.

Today the world lives in an epoch of incredible changes. Many years ago local economic systems have been replaced by national economies. The XX-th century was century of the branches based on use of natural resources (a steel, grain, and oil). The XXI-st century becomes century of that some researchers name "artificial intellectual technologies" which concern micro-economics, biotechnology, telecommunications, hi-tech technologies, robots.

Deep study of the global economy, individual sectors of the economy suggests that, in their totality these lines not only create new segments of the industry (computers, robots), but also shape the industry, contributing to the globalization of culture, modified the old industries.

"Globalization" has become a central concept in the modern world, included in the new century and new millennium. Around the meaning and essence of globalization appear real battles in world forums. It seems quite certain that it is globalization, internationalization, integration of the world, shattered the twentieth century to the set of "independent and sovereign" fragments will be leading the process of the twenty-first century. The world has become too small for more than two hundred sovereign states, the problem of preservation of the Earth make existing sovereignization world totally unacceptable. The economy also requires a combination of all earthly space into a single economic organism. But, like any process, globalization has its positive and negative aspects.

The concept of globalization

Under globalization meant a huge increase in world trade, and other processes of international exchange in an increasingly open, integrated, and does not recognize the borders of the world economy. It is, therefore, not only on traditional external trade in goods and services, but also on currency flows, capital flows, technology transfer, information and ideas, the movement of people.

In the second half of XX century, before mankind got an unprecedented challenge - to find new mechanisms for regulating the global economy, ecology and other spheres of human life began the painful process of transformation of existing goals of the national-state form of organization of world society in some new form of it.

In recent decades, revealed a number of sources of globalization

* One of them - the technological advances that led to a drastic reduction of transportation and communication costs, significantly reducing the cost of processing, storage and use of information. Information services are directly linked to advances in electronics - the creation of an e-mail, the Internet, a global "spider". Modern computer worth over 1,000 pounds is many times more powerful than the computer cost of 10,000 pounds of twenty years ago.

* The second source of globalization - liberalization (free) trade and other forms of economic liberalization has made the world more free trade. The result was substantially reduced tariffs, eliminated many of the other barriers to trade in goods and services. Other liberalization measures have led to increased capital flows and other factors of production.

 
* The third source of globalization can be considered a significant expansion of the activities of the organizations, which became possible as a result of technological progress, and the wider horizons of management based on new means of communication. For example, many oriented companies previously only in local markets, have expanded their production and marketing opportunities, going on a national, ethnic, international and even global level.

Similar structural changes strengthen positions such (multinational) a companies, increase their profit, raise productivity that allows them to choose raw materials sources, to open manufacture and to master the markets in other countries, quickly adapting to changing conditions. Practically all large (multinational) the enterprises have network of branches or the strategic unions which provide with it necessary influence and flexibility in the market. Within the limits of similar multinational corporations almost third of world trade now is carried out. 

Influence of globalization on national economy

Globalization renders a great influence on economy of all countries. It mentions manufacture of the goods and services, use of labor, the investment into "the physical" and human capital, technologies and their distribution from one countries in others. All it finally is reflected in production efficiency, labor productivity and competitiveness.

Some aspects of influence of globalization on national economy deserve a specific mention. First of all we will note extremely high rates of increase of direct foreign investments much more surpassing rates of increase of world trade. These capital investments play a key role in a transfer of technologies, industrial re-structuring, formation of the global enterprises that has direct influence on national economy.

The second aspect concerns influences on technological innovations. New technologies as already was marked, are one of globalization motive forces, but it, in turn, strengthening a competition, stimulates their further development and distribution among the countries. At last, as a result of globalization there is a growth of trade by services, including financial, legal, administrative, information and all kinds of "invisible" services which turn to a major factor of the international trade relations

Advantages of globalization – Positive impact

* Globalization has caused an aggravation of the international competition. The competition and market expansion conduct to deepening of specialization and the international division of labor, stimulating, in turn, growth of manufacture not only on national, but also at world level.

* One more advantage of globalization - economy on manufacture scales that can potentially lead to reduction of costs and reduction of prices, and consequently, to steady economic growth.

* Advantages of globalization are connected also with a prize from trade on the mutually advantageous basis satisfying all parties in which quality separate persons, firms and other organizations, the countries, the trading unions and even the whole continents can act.

* Globalization can lead to increase of labor productivity as a result of manufacture rationalization at global level and high technology distribution, and also competitive pressure in favor of continuous introduction of innovations on a global scale.

As a whole advantages of globalization allow to improve the position to all partners having an opportunity, having increased manufacture, to raise level of a salary and vital standards. The general increase of well-being in the world should become the globalization end result.

Costs of globalization and possible conflicts – Negative impact

Globalization bears with itself not only advantages; it is fraught with negative consequences or potential problems in which its some critics see the big danger.

* One of the basic problems is connected with a question which appears in a prize from globalization. The actually basic part of advantages is received by the rich countries or individuals. Unfair distribution of the blessings from globalization generates threat of conflicts at regional, national and international levels.

The question of distribution of advantages is one of the major in the course of world economy globalization.

* The Second problem is connected with potential regional or global instability because of interdependence of national economies at world level. Local economic fluctuations or crises in one country can have regional or even global consequences. Such possibility carries not only theoretical character, and is quite real that confirms instant display of military disorders and government change now in Libya on sharp jump of the prices for oil in the world market – to 200 US dollars for barrel. The similar phenomena testify to the big vulnerability of the interconnected economy.

* The Third circle of problems generated by globalization is caused by fear that control over economy of the separate countries can change hands from the sovereign governments, including to the strongest states, multinational or global corporations and the international organizations. Owing to it some see attempt of blasting of the national sovereignty in globalization. For the given reason globalization can cause in national leaders feeling of feebleness before its forces, and at electorate (people) - an antipathy to it - that is potentially fraught with serious conflicts.

* Sometimes in the category of costs of globalization carry unemployment in economically developed countries with high level of a salary. But this statement is denied by low norm of unemployment in many of them and its high level in the states with a low salary. The national policy and technological progress are more important conditions of employment, than globalization factors.

To globalization coordinate also a myth that it threatens social welfare of some countries, the greater influence on this sphere however is considerable render other factors - a tax policy and demographic tendencies.

In both cases globalization is usually used for the justification of failures in the national policy of those or other states.

It is important to notice that economic aspects are only one component of results of globalization which has a consequence and not economic character, interfaced to huge risks, potential costs and even accident possibility. One of such areas is the safety sphere where globalization processes can lead to occurrence of conflicts. Other area is the political crises, capable to outgrow from local in large-scale events, and if them in time not to eliminate to lead to accident. As the third sphere it is possible to name ecology and public health services. Global interrelations are dangerous also the global ecological disasters connected, for example, with general warming and climate change, large-scale epidemics.

Conclusion

In summary once again I will underline that global cooperation on the basis of creation of formal or informal international institutes represents the important mechanism for the decision of the problems generated by process of globalization. With its help it is possible to reach stability in globalized the world, to come everywhere to economic growth, to carry out transition to the market in a former communist countries, to accelerate development of the poorest states, and also to solve the problems of globalization having not economic character.

Reference:.

  1. International Economy, [online]. Available from: http://www.uamconsult.com/book_146_chapter_12_1.8._MIROVOJJ_RYNOK_I_MEZHDUNARODNAJA_KONKUREN%D0%A1IJA.html [Accessed 27th February 2011]
  2. Porter M. International concurrence, 1993, International relationships.
  3. Globalisation , [online]. Available from: http://www.aup.ru/books/m77/16_4.htm [Accessed 2nd March 2011]
  4. Globalisation of World economy, [online]. Available from : http://rusconsult.ru/glossary/?word=%C3%EB%EE%E1%E0%EB%E8%E7%E0%F6%E8%FF+%EC%E8%F0%EE%E2%EE%E9+%FD%EA%EE%ED%EE%EC%E8%EA%E8 [Accessed 4th March 2011]

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