There is often a developing comprehensive agreement among many economists that the negative effects of globalization have been substantially exaggerated.
As a result, many are now advocating for a more positive effect of globalization on the world economy. The most recent example is those that predict that the negative effects of globalization will soon be seen by the market participants as a signal of economic recovery and accelerating growth.
On the other hand, there are those who would dispute this claim, arguing that globalization can only be an enriching and helpful experience for the world economy. They believe that globalization brings in new ideas, new sources of competitive advantage, and a more balanced financial system. The cost of investment and foreign direct investment has fallen significantly over the last few years, thereby helping to accelerate growth in economies around the world.
Of course, globalization can also bring in negative effects, and many observers argue that it is generally creating the conditions for instability and the emergence of new terrorist groups. In fact, some governments in Western Europe and in South America have already taken measures to address the negative effects of globalization, both through promoting trade and by discouraging immigration.
For the past several years, even many Chinese people have argued that their country’s severe and growing inequality and other negative effects of globalization had become counterproductive.
Most in the West, however, continue to argue that globalization has brought more growth and opportunity to all. Here are three reasons why the view that globalization has been an unmitigated good for the world economy has actually become more popular in recent years.
First, the benefits of globalization are far reaching. Before the end of the last century, the world economy was based on four major economic pillars – technology, telecommunications, information technology, and finance. During the last three decades, these four pillars have undergone significant changes. Because of globalization, more companies are operating in different locations, and more people are participating in the global market.
Second, globalization increases the capacity of the world economy to respond to the needs of both domestic and global customers. This in turn provides the foundation for improved living standards and higher productivity in an increasingly complex global market. And this is exactly what economists in almost all countries argue that globalization is bringing.
Third, globalization delivers significant financial benefits to its beneficiaries. As economic development in the developing world grows, the global financial system remains relatively stable. The reason is that as countries become more developed, they also tend to concentrate economic activity in their own countries, making capital mobility more difficult.
The benefits of globalization are also realized through technological advances and innovations. The Internet, cell phones, e-commerce, and new communications high quality essay writer online technologies like satellite television and satellite internet are all examples of these benefits. And for business people, globalization also brings benefits through increased access to raw materials and resources.
But for all these positive effects of globalization, there are many questions that still need to be answered.
There are still many questions that need to be answered about how to best enhance the positive effects of globalization. For example, how can globalization create a fairer, more balanced financial system and help countries in the developing world become more economically viable?
Even more importantly, should China be allowed to join the WTO or should it be barred from joining at all? Indeed, this question remains highly controversial. The key player, that may hold the key answer to this question is China itself.
As globalization becomes more entrenched and more established, it will likely become a much more active component of the world economy. It will also influence the types of economic policies that countries enact. What these policies ultimately will be will depend on China, which holds the key to understanding the direction of the future of globalization.