GE104_MODULE-1.docx - LESSON 1 GLOBALIZATION What is...

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LESSON 1- GLOBALIZATION What is Globalization??? A trend toward grIt is a process by which goods, services, capital, people, information and ideas flow across national borders. (Grewal\Levy). Greater economic, cultural, political, and technological interdependence among national institutions and economies. (Wild\Wil\Han). It is the process of trade, communication, and cultural exchange in which it promotes wealth of all nations that increase growth in the economy. A term used to describe the changes in societies and the world economy that are the result of dramatically increased trade and cultural exchange. Globalization is a word used to describe the growing interdependence of the world’s economies, cultures, and populations, brought about by cross border trade in goods and services, technology, and flows of investment, people, and information. Globalization has various aspects which affect the world in several different ways. These aspects include: Industrial globalization – development of worldwide production markets and broader access to a range of foreign products for consumers and companies involving particularly movement of material and goods between and within national boundaries. Financial globalization – development of worldwide financial markets and better Economic globalization – establishment of a global common market, based on the freedom of exchange of goods and capital. Political globalization - creation of international organizations to regulate the relationships among governments and to guarantee the rights arising from social and economic globalization. Globalization has various aspects which affect the world in several different ways. These aspects include: Informational globalization – increase in information flows between geographically remote locations. (This can also be seen as a technological change related to the advent of fibre optic communications, satellites, and increased availability of telephone and Internet.) Cultural globalization - sharing of ideas, attitudes and values across national borders. This sharing generally leads to an interconnectedness and interaction between peoples of diverse cultures and ways of life. Mass media and communication technologies are the primary instruments for cultural globalization. ELEMENTS OF GLOBALIZATION Anderson and VAN Wincoop (2002) enumerated the different elements of globalization: 1. Trade Agreements- bilateral, regional or multilateral economic arrangements designed to reduce or eliminate trade barriers.
2. Capital Flow- measurement of increase or decrease in a nation’s domestic or foreign assets. 3. Migration Patterns- impact of labor market fluidity on production costs through the loss (emigration) or gain (immigration) of potential workers especially those with particular skills.

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