Globalization And Its Limits Essay Examples

The term globalization is complex and vast; however, it denotes the increasing integration, since WWII, of the economies of developed nations, and the growing number of advancing countries, to the extent that there is existence of the operation of one international economy. This increased integration of globe economic activities entails cross-national movements of many varieties of services and goods. Moreover, increases cross-border movements of long-term and short-term capital, increases complex, and dense system of transnational production involving multinational enterprises and independent supplier companies.
In spite of the advances within IT, which have shaped and defined current wave of globalization, transparency in trade remains a political choice. Moreover, trade policies may change with shifts within domestic political equilibrium. Therefore, political sector presents threat and acts as a limiting aspect to globalization as well as its future developments.
Increasing services may also limit globalization. For example, since 1990, the interdependence and integration of regions or countries has been on the rise to form regional trade blocs like NAFTA, EU, and ASEAN. This trend of regionalism is always an indication of a shift towards segmentation and regionalization of trading activities instead of its integration and globalization to a multilateral network of trade. Regionalism increases services within these blocs thus limiting globalization.
Increase of capital flow shows the degree to which economy is integrated. Capital flow leads to the advancement of real income and trade within the world economy. Currently, capital flows take the form of FDI (foreign direct investments) under the MNC (Multinational Corporations) agency. In 19th C, Britain was the main source of capital, and then followed by France and Germany respectively. However, from 1830-1870, 27% of DFI went to Europe continent, 24 percent to N. America, then 19 percent (19%) to Latin America, and 16 percent to Asia continent, 9 percent to Africa, then 5 percent to Oceania. Despite the increase of FDI, the flow direction is highly concentrated limiting globalization.