Introduction 3
1. The Impact of Globalization on Humanity 3
2. The Impact of Globalization on Business World 4
3. The Impact of Globalization on Environment 5
4. Discussion of WTO and Trading Blocks 7
5. Discussion of the Current Events in Eurozone 7
Conclusion 9
Introduction
The impact of globalization was discussed in many studies. Many authors asked oneself a question whether it is good or bad for humanity, business, and environment. However, the answers differ: some scholars argue that globalization makes positive impact on human lives and other aspect, others state that globalization is harmful. An answer cannot be ambiguous because globalization is a complex process having a number of inner interconnections that cannot be seen at the first sight. The aim of the current paper is to evaluate the impact of globalization on several aspects of human life and discuss the current events that are connected with globalization processes.
Globalization is expressed in growth of free trade and elimination of trading barriers between countries. Meanwhile, trading barriers are created to regulate trading activity and prevent violation of property rights, eliminate dumping, and avoid discrimination of trading rules.
According to Eriksen (2007), globalization is characterized by intensification of standardization, modernization, deterioration, and localization of people. These concepts of globalization will be considered and analyzed in the course of the current research.
- The Impact of Globalization on Humanity
At the present time, the world is evolving in a techno-driven state disregard of decrees of nature. On the one hand, distance shortening, emerging of appliances helping save time, and opportunities offered by Internet make human life much easier that one hundred years ago. On the other hand, the development of technologies and fast changes in technologies substitute for real life values.
In his book Einstein (2013) touched upon the subject of globalization influence on the future of civilization and human personality. His outcomes were based on analysis of converging crises caused by alleged individualism and the illusion of separate self. Eisenstein (2013) stated that technological advances used by people can push the Earth to the brink of collapse.
Each process has its positive and negative sides: some people complaint about globalization because it helped make rich people richer while poor became even poor, other people state that globalization offered more opportunities to develop human personality in all aspects; workers in developed countries accuse multinational corporations of social injustice, workers from developing countries are thankful for the job multinational corporations can offer due to globalization; some people consider that globalization encourages communication between people of different races and nationalities, others argue that communication lead to absorption of other cultures by Americanization and incursion of deadly diseases (Einstein, 2013).
The humanity divided by two parts: globalists who state that globalization makes positive impact on the world processes and anti-globalists arguing that inequality worsened and there is no balance between rich and poor people. It is difficult to evaluate the impact of globalization on humanity since each observer is prone to consider the situation from his or her subjective point of view. Whatever the cumulative impact is, humanity should try to find balance between positive and negative sides of globalization and exercise control over personal impact and role in the process contributing to the global processes. However, the impact of multinational corporations cannot be regulated on individual level. Therefore, the governments of the world should take measures to limit the excessive power of corporations aiming to achieve balance (Robbins, Coulter, Leach and Kilfoil, 2009).
The effect of cultural deterioration can be traced by considering the current situation: globalization negatively influences people identity because the barriers on the way to free communication are broken down and different cultures absorb each other. Different cultures merge making people homogenous proving the concept of deterioration. Also, people localization can be traced with the development of internet: physical communication is replaced by virtual communication. There is no need to go out, one can reach the most remote parts of the world using internet making people localized (Eriksen, 2007).
- The Impact of Globalization on Business World
Globalization offered a number of opportunities for corporations all over the world: worldwide expansion, ability to use cheap resources, global capital flow, and outsourcing.
However, there is another side of this process: anti-globalists claim that globalization has led to economic inequality, splitting on “privileged” and “excluded” groups, and imbalance of resource distribution – the richest population that makes up 20% of all humanity consumes more than 80% of the world resources while the other 80% of poorest population consume only 14% of resources (Wild and Wild, 2013).
Expanding worldwide, global corporations offered jobs to the millions of unemployed people in developing countries. However, the wages proposed by the corporation were not fair, working conditions were poor, and the attitude to the workers was unjust. If multinational corporations were previously restricted to commercial activities that influence political decisions, now their power increased enormously because of huge capitals available. Anti-globalists state that the power of multinational corporations is unlimited at the present time worsening inequality. Large corporations have the power to be less accountable and more impudent, take more and offer less: exploit people’s labor, ignore safety standard, and produce cheap goods (Wild and Wild, 2013).
The supporters of globalization claim that globalization can resolve many problems including poverty and unemployment. They claim that free trade can provide global economic growth, make companies competitive, lower consumer prices, and create jobs. Also, developed countries can take advantage from capital and technology inflows having a chance for economic development, introduce democratic values, and human rights. One of the most significant advantages is that consumers can access high-end products from all countries of the world. Ethical considerations are becoming more influential in the contemporary world since corporations are pressed for adherence of social norms and appropriate business conduct (Wild and Wild, 2013).
The situation can be improved by involving power blocks into mutually beneficial cooperation. Mutual respect and trust should be developed between those who control the situation. Besides, business should be deprived of colonialist features declaring democratic values all over the world. The opinion of each powerful global organization should be taken into account.
The concepts of standardization and deterioration can be applied when considering the impact of globalization on business. The corporations unify their strategies to achieve more effective operations offering standardized products. Deterioration is the result of standardization: similar people consume standardized products disregard of uniqueness that provides diversity (Eriksen, 2007).
- The Impact of Globalization on Environment
The development of globalization and increase of production of goods and services is connected with the increase with increased recourse consumption which in its turn leads to imbalance of balance in environment causing air, soil, and water pollution (Newell, 2012).
As well as in the two previous cases, impact of globalization on environment is dual: the positive impact is connected with continuous research of ecologically-friendly technologies, the negative impact related export-oriented destruction (Newell, 2012).
Global corporations are often accused in ineffective management of natural resources, weak participation in environmental programs, and ecological damage. However, the activity related solving ecological problems is increasing and large corporations cannot stand by. Many of multinational corporations started to introduce and participate in various ecological initiatives taking into account the magnitude of the problem (Newell, 2012).
The development of modern technologies had greatly encouraged the research of green technologies that allow using natural resources more efficiently, reduce the impact on the environment (minimize carbon emissions, use of hybrid cars, use of recycled materials, use of non-traditional less harmful sources of energy), use resources many times, and save energy.
The negative impact is connected with overuse of natural resources, deforestation as a result of using wood for production of goods, removal of ecosystems as a result of chemical pollution by large corporations, and other harmful influences connected with production increase (Robbins, Coulter, Leach and Kilfoil, 2009).
Besides, the number of natural disasters and cataclysms had dramatically increased during the last ten years. Earthquakes in Japan, snowstorms in the USA and Canada, floods in Europe, tsunami in Thailand and Indonesia, landslides in China – the news often deliver similar reports (Recent Natural Disasters, 2013). The disasters occur because deforestation and air pollution cause imbalance of natural components and the climate is changing causing harm to ecosystems (Newell, 2012).
The most negative impact connected with globalization is global warming caused by greenhouse gas emissions into the atmosphere that appeared as a result of industrialization growth. At the present time large corporations pay a lot of attention to environmental sustainability and using green technologies. However, ecological situation in the world is worsening and requires taking steps to improvement.
The effect of deterioration can be traced when considering the impact of globalization on environment: large corporation produce goods to increase profitability disregard of the impact made on environment (Eriksen, 2007).
- Discussion of WTO and Trading Blocks
As the one of the most powerful organizations regulating trading activity, WTO contributes to the globalization processes. WTO regulates trade on the international level and influence globalization at global level from trading perspective. On the one hand, WTO contributes to deteriorating processes such as unequal competition by giving developing countries less access to the markets in comparison to developed countries and imposing higher tariffs on the most valuable products produced in developed countries, anti-dumping rules are not perfect being sometimes used to stop competition presented by labor-intensive products, the enforcement of rights for intellectual property makes technology expensive making little impact on piracy (World Trade Organization, 2011).
Globalization resulted from free trade among countries. Free trade encourages exchange by goods, services, capital, and technology, but it is also connected with constraints (trade barriers, absence of reciprocity, inconsistencies in trading rules between countries) and various illegal activities (violation of intellectual property rights, piracy). Thus, WTO contributes to the regulation of globalization development by offering a global platform for discussion various issues.
WTO, as well as other trading blocks exercising similar functions, can contribute to regulation of globalization processes by taking the following measures: provide governance to the countries helping reduce poverty and improve investment climate, the development of international framework for globalization is needed aiming to influence market forces, promote ethical considerations and human rights, declare binding values and absolute standards to be followed by participants (World Trade Organization, 2011).
- Discussion of the Current Events in Eurozone
According to The Guardian (2013), crisis of eurozone started in Greece and Portugal switched to German economy in 2011 due to globalization. European economies tight up within free trade obligations were drawn into crisis of eurozone caused by mismanagement of financial assets by Greek authorities.
Another financial crisis occurred in Cyprus this year because of globalization and implementation of deregulation programs by EU. IN 2004, EU preserved competitive tax regime offered by international companies and allowed them to compete with EU tax havens that made this sector too powerful. Professional companies had benefited from this situation: banks received huge returns for taking high risks and senior managers received huge bonuses. However, this situation threatened European integration. The case of Cyprus proved that ethical considerations are an important part of contemporary idea of social banking on the contrary to globalization profit-seeking “culture” (Trimikliniotis, 2013).
At the present time, globalization idea is turning around profit making by all means. However, the emphasis should be made on social development in banking sector to make banking systems sustainable as it serves as basis for eurointegration. Restrictions imposed on free trade and free capital flow processes are necessary requirement to be able to regulate market forces and influence critical situations (Robbins, Coulter, Leach and Kilfoil, 2009).
Conclusion
Globalization processes can be considered from two perspectives: positive and negative. Despite of a number harmful activities related the development of globalization processes, there are several positive impacts considered in the course of the current research. Globalization influences all aspect of human lives from prices for food to the changes in personality. The current events in Eurozone are evidence of harmful influence of globalization when misbalance in the economy of one country can influence economies of other related countries. WTO and other global trading blocks have the power to influence globalization processes by imposing restrictions on free trade in the case of necessity.
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