Globalization allows for free trade between countries, but its effects are still uncertain. Globalists believe it has positive economic and quality of life impacts, while anti-globalists argue it can harm small businesses and the environment. Globalization can also lead to financial instability and benefit multinational corporations.
Globalization means that countries can engage in free trade with each other. Globalization is a fairly recent development, so the effects of globalization are still somewhat undetermined. People who are in favor of globalization are often called globalists, and people who are against globalization are often called anti-globalists. Globalists believe that globalization has positive effects on economic growth and the quality of life of citizens in countries that engage in global free trade. Anti-globalists believe that globalization can cause economic and environmental damage to a country and can have greater benefits for those who are already wealthy than anyone else.
Anti-globalists believe that multinational corporations benefit greatly from globalization, while small businesses may suffer from increased global market competition. A corner liquor store may find it difficult to compete with a chain market location opened by a company that hails from overseas. The local computer hardware salesman may find it difficult to sell his computer parts to the office in town when they can order cheaper parts distributed directly from a manufacturer in another country. These overseas companies can compete within higher priced markets without incurring the costs of operating a storefront or business within that higher priced market. This allows them to offer products at a lower price, but has an impact on small local businesses that survive on sales.
Globalists believe that the economic growth that occurs as one of the effects of globalization outweighs its drawbacks. They expect that enough money and economic progress will be made to pay for any damage to the environment or small-scale economy that may occur. It can also help improve the economies of nations with high levels of poverty by giving their citizens access to technology, clean water, and city infrastructure that comes with business economic development.
One theory of the effects of globalization suggests that global trade can increase global financial instability. As the system of globalization implies that one country’s economy can directly affect another country’s economy through their mutual trade, financial crises starting in one country can become a worldwide problem for all the countries connected to it. The economic effects of globalization are generally positive for countries engaged in global trade, increasing the per capita income of those countries’ citizens. In some countries, the rich earn more money, while the poor lose access to financial and natural resources taken by global companies.
Globalization can help mega corporations which can create environmental disturbances and pollution. Many believe that the economic growth that occurs as one of the effects of globalization will create enough revenue to clean up any environmental catastrophes that occur as an economic crash. Still others believe that companies do not take responsibility for cleaning. In the past, legal limits on corporate liability for environmental damage caused by disasters such as oil spills prevented large corporations from taking full financial responsibility for cleaning up environmental problems caused by their business operations.
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