The Impact of Globalization on Economies - Term Paper Example

The entire world is functioning as a single unit due to integration of goods, services, knowledge and culture which should have benefitted economies and helped them to move ahead. Instead it has been witnessed that despite economically backward countries having high economic resources are unable to match the unprecedented growth rate witnessed by USA & Western Europe which is due to imbalance which exist in the system and has resulted in certain economies showing different results. This paper thereby looks to analyze the manner in which globalization has affected different economies differently and has resulted in different benefits and growth for each This helps us to understand globalization and befire moving ahead it is important to understand what it actually means. Various new definations have been found but the one which is most accepted by people is that globalization relates to the movement of people, goods, capital and ideas between different economies so that all economies around the world can witness growth and integrate together and work towards the betterment of the society (Globalization, 2012). This has not been the case in the real world scenario as developed economies like the USA and Western Europe have exloited the poor and developing economies and used their resources towards the economic benefit of their own country instead of the whole society. This has created differences and resulted in widespread imbalances between the world economies. This can be clearly seen by the fact that USA and Western Europe has moved forward as globalization has increased both the exports and borrowed funds for the country (Globalization, 2012). This has impacted the disposable income and has resulted in spready inequity as thje poor economies like Kenya and African countries had to suffer. This has created an significant difference as abundant of labour in the African countries are expolited by developing counties through lower wages and has created wage differentials which has thereby impacted the manner in which benefits instead of spreading to different nations have been diluted. There has been some impact of globalization of Eurpoean countries as well. This is due to the fact that the working boomers are aging and are provided with huge retirement bonuses and packages at the cost of the present working class. This has resulted in wage differentials as the present class of employees are not compensated propely and has increased the bunden of the financial exchequer of the economy (Hartmann, 2010). This has thereby affected the foreign exchange state and has pushed the economy slightly backwards but still they are able to take advantage of the economic resources of other country and ensure growth for their region. This has thereby resulted in the development of neoliberal policies in the worl economies and has totally changed the manner in which economies work as they look towards their own benefit (Quiggin, 2000). This has resulted in the creation inequity among the nations which is clearly visibible by the growth rates posed by developed ecnomies which have scarce resources in comparison to the poor and developing economies who have vast resources but show a poor growth rate. Thus the manner in which the wealth is shared among the nations has been affected and has resulted in economies gaining at the cost of others (Quiggin, 2000). The development of newliberal policies has resulted in creating differences where the poor and developed economies having the resources have not been able to grow as the developed economies like US and Western Europe. The world economies due to globalization and development of nonliberal policies as a result has over shadowed the manner in which the economies could have benfitted and has created differences and made look towards each other with suspicion (Thorsen & Lie, 2012). This makes it important that the world bodies realize the fact that the manner in which unequal imbalance has been created around the world is addressed and a remedial solution to this overmounting problem is identified so that the economies are able to integrate and move forward. The manner in which globalization has affected the business can be seen from the fact that Europe which imports around 60% of its products from poor and developing countries is due to fact that the resources available in those countries can be expolited at a lower cost (Fukuyuma, 2009). This is primarily for the fact that poor and developing countries are not able to provide the society the basic necessities of life i.e. food and shelter which has resulted in the developing countries exploiting them and paying lower wages. This ensures that the products are avaliable at a lower cost leading towards economic growth of one country at the cost of other. It has been identified that the American culture is somewhat different where people look towards wearing Levis, watching CNN and drinking coffee at Starbucks (Wasserstrom, 2003) as the economic level and disposable income of the people has increased. This has been due to the fact that they are able to lead and provide direction to the underdeveloped country and look towards using their resources for their benefit instead of mutual benefit. This can be seen in Abeokuta in West Africa where the local people followed the western education without knowing that it was getting influenced by British power which gradually transformed the culture (Akande, 2002). This created a stance where the outer factors were able to influence them and used their economic resources for their benefit and further deprived the economic conditions of the people. This has tereby created mass inequity and differentails in the manner the benefits are passed on. This has thereby created widespread differences between the developed economies like USA & Europe and other developing economies resulting in job losses and others benefitting as a result. This is primarily the case within African & Asian countries as the rapid growth in population and widespread unemployment has made people work at a much lower rate (Colebatch, 2004). Thus, globalization has resulted in creating differences between the economies as developed countries look towards exploiting the underdeveloped countries by using their ample resources to their advantage. Also, the fact that the developed countries are able to influence the underdeveloped countries ahs resulted in the creation of inequity and has totally affected the manner in which the ecnomies work leading towards inequity and unrest among all. References Akande, W. 2002. The drawbacks of Cultural Globalization. Retrieved on September 15, 2011 from http://www.globalpolicy.org/component/content/article/162-general/27594.html Colebatch, T. (2004). Globalization creates winners & losers. Retrieved on March 23, 2012 from http://www.theage.com.au/articles/2004/04/12/1081621892074.html?from=storyrhs Fukuyama, F. 2009. Economic Globalization & Culture. Retrieved on September 15, 2011 from http://www.oocities.org/rpallais/Fukuyama.htm Globalization. (2012). Globalization. Retrieved on March 23, 2012 from http://www.globaleducation.edna.edu.au/globaled/go/cache/offonce/pid/178 Hartmann, T. (2010). Globalization is killing the Globe: Return to Local Economies. Retrieved on March 23, 2012 from http://www.countercurrents.org/hartmann120210.htm Thorsen, D. & Lie, A. (2012). What is Neoliberalism? Department of Political Science. Retrieved on March 23, 2012 from http://folk.uio.no/daget/What%20is%20Neo-Liberalism%20FINAL.pdf Quiggin, J. (2000). Globalization, neoliberalism and inequity in Australia. The Economics of Labor Relation Review, 10 (2), 240-259. Retrieved on March 23, 2012 from http://espace.library.uq.edu.au/eserv/UQ:10951/jq-elr99.htm Wasserstorm, J. 2003. A Mickey Mouse Approach to Globalization. Retrieved on September 15, 2011 from http://www.globalpolicy.org/component/content/article/162/27612.html Read More