Globalization
Explain what is meant by the term ‘globalization’. Identify and analyse the key drivers of the process of globalization over the last 20 years.
In generally, globalization refers to integration and interconnection between people, transnational corporations and different governments. According to Rothenberg (2002), “Globalization is the acceleration and intensification of interaction and integration among the people, companies, and governments of different nations.” On the other hand, in terms of business context, globalization is the movement towards economic activity around the world. Free trade between countries, outsourcing or offshoring the production, capital flows and internalisation of several brands (Coca-Cola, Toyota, GAP, Nike, Pizza Hut, McDonalds, Apple …) can be an example for globalization. International Monetary Fund working paper states (2003) states that, “The growth rate of world trade has been greater than that of world output in almost all years since 1960 and the cumulative increase in the volume of world trade is almost three times larger than that of the world output over this period.” The process of globalization accelerated during the last 20 years and especially economic, rise of information and communication technology, political factors and influences have been the key drivers for this process. Because of these key drivers of globalization, new contemporary world occurred.
First of all, globalization has a significant importance of the development of the world economy. Transnational corporations are the biggest factor of this development. According to Giddens (2009), “Transnational corporations are at the heart of economic globalization. They account for two-thirds of all world trade, they are instrumental in the diffusion of new technology around the globe and they are major actors in international financial markets.” For example,
In generally, globalization refers to integration and interconnection between people, transnational corporations and different governments. According to Rothenberg (2002), “Globalization is the acceleration and intensification of interaction and integration among the people, companies, and governments of different nations.” On the other hand, in terms of business context, globalization is the movement towards economic activity around the world. Free trade between countries, outsourcing or offshoring the production, capital flows and internalisation of several brands (Coca-Cola, Toyota, GAP, Nike, Pizza Hut, McDonalds, Apple …) can be an example for globalization. International Monetary Fund working paper states (2003) states that, “The growth rate of world trade has been greater than that of world output in almost all years since 1960 and the cumulative increase in the volume of world trade is almost three times larger than that of the world output over this period.” The process of globalization accelerated during the last 20 years and especially economic, rise of information and communication technology, political factors and influences have been the key drivers for this process. Because of these key drivers of globalization, new contemporary world occurred.
First of all, globalization has a significant importance of the development of the world economy. Transnational corporations are the biggest factor of this development. According to Giddens (2009), “Transnational corporations are at the heart of economic globalization. They account for two-thirds of all world trade, they are instrumental in the diffusion of new technology around the globe and they are major actors in international financial markets.” For example,
Bibliography: International Monetary Fund (2003), How Does Globalization Affect the Synchronization of Business Cycle? [Online] Available at: http://www.imf.org/external/pubs/ft/wp/2003/wp0327.pdf [Accessed 27 October 2011] Rothenberg, L, E Zurn, M (2010), “Fall of Berlin Wall”: Globalisation and the Future of Europe. New Zealand International Review: Vol:35, Issue 3