The paper 'Impact of Globalization' is a perfect example of a Macro and Microeconomics Literature Review. Globalization entails considering the world or a part of it as a single market in which to conduct business (Joshi, 2009). For instance, some firms have production and research facilities around the globe where they conduct their research hence networking their research, production, and marketing in a global context. Globalization opens new markets and sources of knowledge for a firm which enhances their competitive advantage. Multinational firms can, therefore, sustain their competitive advantage in the international market by strategizing on developing and leveraging their distinctive internal capabilities as well as seeking to improve and develop new ones. Chaichian, (2014) Indicates that globalization is a process through which enterprises get involved in international markets.
It’ s also defined as international integration arising from the interchange of the world in regard to products, ideas, and other aspects of culture. This is enhanced through an international business that collectively describes all commercial transactions that take place between two or more regions, countries, and nations beyond their political boundaries. Perlmutter (1969) notes that, despite the international business being around for quite some time, it has grown and become more complex over the past three decades.
More and more firms are looking for global market opportunities more than before and in that way influencing the lives of billions of people worldwide. This paper looks into how globalization has impacted India as a developing country both positively and negatively. Globalization has opened doors to new prospects in developing countries such as India. This has been brought about by access to international markets, importation of skills, and expertise in addition to technology which has enhanced productivity and living standards (Neil, 2005).
However, despite all the positivity brought about by globalization, it has brought about new challenges as well. The economy of India was opened up in the nineties after a period constrained by barriers to trade and investment liberalization. This is however in the past as the opening up commenced in the nineties has gone on to lower the barriers to trade and giving way to globalization. This came on the back of policy measures undertaken due to the need for multinational organizations which enhanced a more open economy.
Some of the measures taken by India were eradication of the industrial licensing regime and reduction in tariff rates among other factors (Jayashankar, 2008). Trade liberalization and involvement in the global market have improved the country’ s GDP by far thereby improving the country’ s global competitive position. Through globalization, the world has become more interdependent. Global firms are able to produce their products and services in different countries and serve customers on a global platform. In India, it entailed eradicating the trade barriers that existed and integrating the country’ s economies through financial flow, trade in goods and services, and corporate investments between the country and other nations (Sharan, 1981).
This has been brought about by the advancement in technology mostly in communication and transportation. The Indian government took great steps in allowing direct foreign investments in the early nineties which has benefited the country largely.
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