Globalisation and Environment.docx - GLOBALISATION AND...

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GLOBALISATION AND ENVIRONMENT One of the most important debates over the last decade has been the environmental consequences of globalization. Proponents of trade liberalization for instance argue that, since environmental quality is a normal good, trade-induced income growth causes people to increase their demand for a clean environment, which in turn encourages firms to shift towards cleaner techniques of production. Thus, free trade provides a win-win situation in the sense that it improves both environment and economy. Opponents of globalization, on the other hand, fear that, if production methods do not change, then environmental quality deteriorates as trade increases the scale of economic activity. Moreover, developing economies tend to adopt looser standards of environmental regulations to attract more foreign investment. Trade liberalization thus may lead more growth of pollution- intensive industries in developing countries as developed countries enforce strict environmental regulations. As a result, free trade has a significant adverse effect on environmental quality. Globalization process, as a process of qualitatively higher level of the economic life internationalization, has several dimensions, namely: economic, social, political, informative, but also cultural. The dimensions of globalization process influence human behaviour in various ways, and apart from positive effects, they have also a differentiated impact on the environment. Economic dimension of the globalization process is linked with the liberalization of economic relations related to the growing importance of the international trade and Foreign Direct Investment and capital inflows. This dimension of the globalization process is perceived by society predominantly in linkage to top macroeconomic indicators, such as economic growth and employment. In this connection less is said about ecological dimension, while the economic integration, realised via international trade and inflow of FDI and capital, is an essential factor that influences the environmental quality and sustainable development of a country, both in positive and negative ways. It reflects the fact that on the one hand the globalization process enables economies to carry out structural changes, increase employment and revenues of the inhabitants and public budgets and implement environmental technologies, as well as to open access to markets that prefer environmentally suitable products. On the other hand the globalization process can influence the extent of exploitation and pollution of environmental resources. Economic globalization impacts the environment and sustainable development in a variety of ways and through a multitude of channels. - Globalization contributes to economic growth and thereby affects the environment in many of the same ways that economic growth does: adversely in some stages of development, favorably at others.
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