Present the Advantages and Disadvantages of Globalisation, Is Free Trade Desirable?

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Present the Advantages and Disadvantages of Globalisation, Is Free Trade Desirable?


The first part of this essay will be aimed towards understanding the concept of globalisation. We will analyse the various advantages and disadvantages that arise as a result of globalisation. The second part of the essay will concentrate on investigating the benefits and drawbacks that arise from the free trade.

In order to devise an accurate and informative response to the essay question we must first understand the concept of globalisation. Globalisation is about what is happening to economies on a world scale. Although the idea is not often clear, everyone who talks about the concept recognises that the countries of the world tend to divide into two groups: those with developed economies and those that are sometimes referred to as developing countries. The economically developed countries have modern industries and technologies (the U.S, Japan and the countries of western Europe). The developing countries (most of Asia, Latin America, and Africa) have more lower incomes and large groups of impoverished people, especially peasants. However some countries are in between and have characteristics of both kinds of economies (for example, states of the former Soviet Union and Eastern Europe).

The economic interactions of globalisation are fundamentally about big capitals of the developed countries that operate around the world. These are sometimes called multinational corporations; these dominate the economies of the developing countries along with a handful of global agencies such as the International Monetary Fund, the World Trade Organisation and the G-7 central banks. The results affect the majority of the working population in the developed countries, as shown by issues like runaway factories, satellite-linked offices and the attack on social welfare programs in the name of the free market.

The term globalisation was originally started in the 1960's to describe international capital flows. Today however, globalisation is not just capital flow, but a revolution to make individual nations part of a global village, under one legislation. Basically, it's to remove the distance between countries. As a result, it's also the restructuring of everything, from politics, to the economy, to make it part of a global economy. The defining characteristic of globalisation is a free market capitalism and trade liberalisation. The consequences of these changed however, have not been discussed and are under heated debate. While some people think of globalisation as primarily a synonym for global business, it is much more than that. The same forces that allow businesses to operate as if national borders did not exist also allow social activists, labour organizers, journalists, academics, and many others to work on a global stage. With the technological revolution, it is now a lot easier to do so.

Advantages and Disadvantages of Globalisation

The existence of trade has always been present between people and between countries. However since the 2nd World War trade in goods and assets has gained a larger significance everywhere. There are various advantages related to globalisation - first the foremost related to trade and investments spreading wealth and linking countries together, however simultaneously there are various negative consequences.

Some of the main advantages are:

Increased liquidity of capital allowing investors in developed nations to invest in developing countries.

Increased free trade between nations.

Corporations have greater flexibility to operate across borders.

Increases in environmental protection in developed nations.

There will be a reduction in the likelihood of war between developed nations.

Greater independence of nation-states.

Spread of democratic ideals to developed nations.

There will be a reduction of cultural barrier, increases the global village effect.

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