Economic globalization, characterized as long distance flows of goods, capital and services as well as information and perceptions that accompany market exchanges.
Political globalization, characterized by a flow of government policies
Social globalization, expressed as the spread of ideas, information, images, and People.
Globalization is good for growth and positively promotes the growth. Countries that globalized have higher growth rates. The increase in the growth rate due to the economic integration and in developing countries the absence of restrictions on trade and capital. There is although proof, that cross border information flows encourage growth. The claim that poverty exist because of globalization is therefore not suitable. Those countries with the lowest growth rates are those who did not globalize. Countries like Zimbabwe or Rwanda, e.g., insulated themselves from the world economy. They have poor institutions which suppress growth and promote poverty. On the other hand, poor countries simply to globalize their economies to prompt growth rates and reduce poverty.
As another example, the country with the positive change in globalization from 1975 to 2000 has been China. Its index increased by 2.14 points. According to the regression results China’s growth rate in 2000 is 2.33 percentage points higher as in 1975 due to increased integration with the rest of the world. This example shows the limitations of the globalization process in reducing poverty as well. To become globalized would require massive efforts. Such effort is almost impossible to achieve in the short run but will take long time.
(Ali M. Alli, Gregory S. Winter David L. May, 2007) this article shows that the globalization and main areas affected by the globalization. Global culture is becoming increasingly developing. The globalization process is characterized by challenges such as environmental deprivation, over-population, over-consumption, public health, and education.
There are five main areas affected by globalization: Globalization of and by the economy, Globalization of and by information/communication technology, Globalization of and by politics, Globalization of and by business, Globalization of and by education. The General Agreement on Tariffs and Trade (GATT) simulates free trade between countries by encouraging the reduction of tariff and non-tariff barriers. This allows firms to more easily trade and move around the world. The globalization of markets is one of the most important developments of this century. Its impact on the economic transactions, processes, institutions, and players is dramatic and wide ranging.
The process of globalization is facilitated by technology which dislocates the humans from both time and space and projects them into a world where the future and past exist at the same time. People are better able to communication with each other, understand, and learn from each other using technology as a standard perspective. A world is being formed where people assist and work together to overcome common challenges. Globalization has already distorted our world radically: the internet and E-mail are globally direct methods of information collection and communication.
(Pinelopi Koujianou Goldberg Nina Pavcnik, 2006) The text of that article shows the distributional effect of globalization in developing countries. Globalization is a wider perception usually used to illustrate a variety of phenomena that increased the economic interdependency of countries. Such incidents include flow of goods and services across the border, restrictions in policy and reduction in transport barriers to trade, foreign direct investment and immigration. The entry of many developing countries into the world market in the last three decades coincides with changes in various measures of inequality in these countries.
One of the few noncontroversial insights of trade theory is that changes in a country’s experience to international trade, and world markets more usually, affect the distribution of resources within country and can create substantial distributional conflicts. Two trends appear clearly from the data analysis. First, the exposure of developing countries to international markets as measured by the degree of trade protection, the share of imports and/or exports in GDP, and the importance of capital flows, foreign direct investment in particular, and exchange rate fluctuations has increased substantially in current years. Second, while inequality has many different extent, all offered measures for inequality in developing countries appear to an increase in inequality.
Globalization and Liberalization: The Impact on Developing Countries (Barbara Stallings, 2001)
This article shows the impact of globalization on developing countries over the past decades, mainly in terms of its effects on developing countries and how has it affected the potential for growth and equity. Four basic opinions are developed in the paper with respect to the impact of financial globalization.
First, globalization has increased the capital available to developing countries Which Increases their ability to grow more rapidly than if they had to rely completely on their own resources. Not all capital flows give equally to growth, though; short-term flows and the purchase of existing assets are less costly than investment in new facilities
Second, capital flows are unequally distributed by province and country, thus bias in the patterns of growth. Inequality has also increased within countries, due in part to the employment patterns generated by international investors. There is also an unequal distribution of capital within countries by geographic area, sector and social group, creating a division between winners and losers.
Third, government try to remove the benefits from the globalization of capital, while limiting the costs, is more possible than usually thought. The source of many problems is local rather than global. International and domestic policies are needed to change if developing countries are to maximize the benefits and minimize the costs from the new world environment created by globalization. Unfortunately these countries have little voice with respect to international policies, which are mainly determined by the major developed countries together with the international financial institutions. Finally, policy changes at the global, regional, and national levels could improve the picture of developing economies.
(2009) the text that article shows how the process of globalization has affected the Chinese economy in areas of trade, finance markets, income distribution and environmental issues. China joined WTO in 2005 in response to globalization. Due to Globalization china reduce their trade barriers, giving positive impact of increases in international trade and foreign investment resulting increase in the economic growth and development. There has also been an increase in education level and reduction in poverty. Increase in income level also increases the investment. This also increases the economic growth in china. The Chinese government has providing a new channel for both domestic and international investment. But the benefits of the globalization are not equally enjoyed by the entire population. The growth rate increase in economy also caused environmental problems such as pollution and degradation.
Rusdy Hartungi, (2006) “Could developing countries take the benefit of globalization?”
Globalization is a very wide issue. This article discusses the issue related to trade, labor, intellectual property and environment. The impact of globalization provides benefit mostly to industrialized countries or MNC’s operating in developing countries. Globalization provides a new taught and suggestion to developing countries. Globalization will bring prosperity to developing world only if industrialized countries and MNC’s are willing to adopt a code of conduct, which permits their profit motives to be corresponding with the self-sufficient interest of developing nations.