Positive Effects of Globalization

Globalization is one of those words everyone has heard of, but the meaning of which is not very widely understood. So before we proceed with this discussion, let us see what it actually is.

What is Globalization?

Let's face it. People are moving from one country to another, the trade restrictions are reducing, domestic markets are opening up for foreign investments, telecommunications are better established and the countries that are leading the innovations are passing on their know-how to the countries who are not. In short, the people are no longer bound by territorial restrictions any more, getting the world closer. It's no longer about 'my country and me', it's now more like, 'the world and us'. People are no longer bound by territorial restrictions-unless of course, there are security issues. The businesses are expanding, the horizons are widening, and the people are coming together to form one homogeneous unit - HUMANITY.

This is known as globalization.

It is not just the coming together and integration of people. It is the integration of ideas, of cultures and of values. The pessimists continue the talk about the friction this is generating, but the endorsers of globalization choose to remain positive about things and go with the flow. The optimists want to jump on to the bandwagon of the globalized world and reap the benefits of a larger market and a larger talent pool. And hence, despite the doomsayers, globalization goes on unabated.

Why Globalization is Useful

It would be rather difficult to discuss the extent of the plus points that globalization has had on the world at large. But still, here are some of the positive impacts globalization has on so many demographic segments of society.

Increased Competition
One of the most visible effects is the improved quality of products due to global competition. Customer service and the 'customer is the king' approaches to production have led to improved quality of products and services. As the domestic companies have to fight out foreign competition, they are compelled to raise their standards and customer satisfaction levels in order to survive in the market. Besides, when a global brand enters a new country, it comes in riding on some goodwill, which it has to live up to. This creates competition in the market and a 'survival of the fittest' situation.

Employment
With globalization, companies have forayed into the developing countries and hence generated employment for them. But it can turn out to be either good or bad, depending on the point of view you wish to see it from. It has given an opportunity to invest in the emerging markets and tap up the talent which is available there. In developing countries, there is often a lack of capital which hinders the growth of domestic companies and hence, employment. In such cases, due to global nature of the businesses, people of developing countries too can obtain gainful employment opportunities. But the developed countries have lost jobs on account of this movement of jobs to the developing world and hence it is a pinch felt by people in the First World.

Investment and Capital Flows
A lot of companies have directly invested in India, by starting production units in India, but what we also need to see is the amount of FII that flows into the developing countries. Indian companies which have been performing well, both in India and off the shores, will attract a lot of foreign investment, and thus pushes up the reserve of foreign exchange available in India. This is also one of the positive effects of globalization in US and other developed countries as developing countries give them a good investment proposition.

Foreign Trade
While discussing the effects of globalization, how can I leave out the impact of foreign trade on an economy. Comparative advantage has always been a factor even in the old times. While trade originated in the times of early kingdoms, it has been institutionalized due to globalization. Previously, people had to resort to unfair means and destruction of kingdoms and countries to get what they wanted. Today, it is done in a more humane way, with mutual understanding. People who operate in uncivilized ways, now have to face the WTO and other world organizations that have been established with a view to control and regulate the trade activities of the countries.

Spread of Technical Know-How
While it is generally assumed that all the innovations happen in the Western world, due to globalization, the know-how also comes into developing countries due to globalization. Without it, the knowledge of new inventions, medicines would remain cooped up in the countries that came up with them and no one else would benefit. But due to improved political ties, there is a flow of information both ways. And this point - the spread of know-how, can also be expanded to include economic and political knowledge, which too has spread far and wide. The most obvious example of the spread of knowledge is that the Western world today are waking up to the benefits of Ayurveda and Yoga, while the Western antibiotics and flooding the Indian markets improving the quality of life (and the longevity too) of people in India.

Spread of Culture
Not all good practices were born in one civilization. The world that we live in today is a result of several cultures coming together. People of one culture, if receptive, tend to see the flaws in their culture and pick up the culture which is more correct or in tune with the times. Societies have become larger as they have welcomed people of other civilizations and backgrounds and created a whole new culture of their own. Cooking styles, languages and customs have spread all due to globalization. The same can be said about movies, musical styles and other art forms. They too have moved from one country to another, leaving an impression on a culture which has adopted them.

Spread of Education
One of the most powerful effects of globalization on women and men both is the spread of education. Today, you can move in the search of the best educational facilities in the world, without any hindrance. A person living in US can even go to another continent for a new experience and some courses which one may not find in the home country. If one is interested, one can even get a specialization in subjects indigenous to a country and spread that knowledge to the home country. A good example of that is how the American managers went to Japan to learn the best practices in the field of mass production and incorporated that knowledge in their own production units.

Legal and Ethical Effects
Gone are the days where the limited jurisdiction became a hindrance in the prosecution of criminals. These days due to international courts of justice, these criminals can no longer seek asylum in a foreign country, but will be brought forward and there will be justice. Due to globalization, there is also an understanding between the security agencies and the police of two or more different countries who will come together to curb global terrorism. Hence, it is now possible to catch the perpetrators of crime irrespective of which country they choose to hide in.

Organizations for Environmental and Social Concerns
In cognizance of the damage that has been caused to our world over the years, the individual nations have decided to come together to find a way to save our world from ourselves. Organizations monitoring climate change as well as those which look at the welfare of our animals and marine life, are undoubtedly one of the good uses of globalization for the environment.

I know that globalization has also created many negative effects, but I believe it's always better to look to the future with optimism and hope. Tomorrow, hopefully, we will be able to minimize or even eradicate the evil forces that give it a bad name. Thus we will be able to move forward with peace and harmony.