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Positive And Negative Outcomes Of Globalisation

Info: 1259 words (5 pages) Essay
Published: 2nd May 2017 in Economics

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Globalisation is the process by which the world is connected as one through trade and set-up communication. This connection is occurring at a fast rate. According to Ervin and Smith (2008, p.2), “Globalisation describes the ongoing global trend towards the freer flow of trade and investment across borders and the resulting integration of the international economy.” The need to trade and conduct business with other countries Is what has led to Globalisation. Regional societies and cultures are trading with each other leading to mutual co existence.


Globalisation has existed for a long time. This came about due to agriculture and industrial revolution in the ancient times. Manufacturers and producers had to trade with what they had. The construction of roads, invention of wheel carts, and the coming up of big cities such as Rome and Olympia contributed to trade between the regions. In modern times the invention of aero planes, trains, mobile phones, internet and good network system has largely brought about the expansion of globalisation. This happened after World War 2 owing to the fact that peace had to be conventional. This could only be attained through trade and communication.

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The term globalisation is used in the media and by the world leaders every now and then. Prime Minister Gordon Brown has said that it is a “fact and here to stay” (Gordon Browns speech to the CBI, Nov 2006). This statement means that globalisation has taken charge, and will continue to increase as the world becomes a global village.

The growth of globalisation has occurred owing to number of reasons. Tisdell & San (2004, p.84), say that, “Globalisation has proceeded rapidly since 1960, mainly due to reduced man-made barriers to trade, such as reduced tariffs.”

Generally the reduced cost of requirements for trade in the post war era has led to expansion of globalisation. The existence of technology such as computers and universal satellites has created a single market.

A great deal of advertising that countries are doing for themselves is leading to verse responsiveness from other states. This is because countries are producing individual goods. People are traveling for themselves to purchase what they wish for because it is cheap and available.

Globalisation has caused competition among high-quality goods. Lewis & Richardson (2001, p. 39), state that, “Global integration allows better performing firms, workers, and communities to grow faster than other firms, workers, and communities and so to increase their share of their industry, their lab our market, and/ or their region.” Further from that, trade that comes as a result of this enhances the shared relationship amid the countries.


As globalisation continues to grow and improve it brings some effect. This is because both the developed countries and developing countries are involved and the level of production is not the same. Some deal with raw material and others deal with manufactured goods. The global recession is also making some countries to suffer the challenge. According to Hedegaard & Lindstorm (2000, p. 50-51), there should be balance between the import and export conduced between developed and developing countries. There should be international equalization of factor prices. “Globalisation should lead to capital exports from industrial to developing countries; exports of agricultural products and labour intensive manufacturers from developing to (initially) developing countries.” This should reduce the disparity between them.

The level of output has increased worldwide. This is because various countries are producing in anticipation of selling to other countries. This increases the yield and production of further goods. This is advantageous because countries will never go in need. It will ensure incessant supply of goods and services.

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It has also led to development of ICT in most countries especially developing ones. This is because there is need for unremitting communication among the countries for trade purposes. Information is also necessary if business is going to be conducted. It brings technical advancement especially to the developing countries. This is because they have to attain the standards of the core countries. It has been said that ICT is globalizing at a swift rate.

It has led to integration between diverse cultures and societies. This is because they indulge in trade. As a result of these there is exchange of culture and behavior. The world becomes a village as a result. Integration also brings about good co existence between the different countries and diplomatic relations.


Globalisation has positive and negative effects. The constructive effect of globalisation is that it has created opportunities for countries to market what they have. This is because they have potential consumers for their goods. It has created a market place for goods, therefore this is positive as countries earn there revenues. Globalisation has also promoted the design of new technologies. This is because of the competition that exists between countries conducting the trade. Every country is trying to provide the latest technology. This is good for human race because their life is enhanced. Globalisation also brings about growth and improvement of developing countries as they get new technology. It enables them to improve the way of life of their people and this is also good as it enlightens people. It also brings about good diplomatic relations amid countries. This because of the relationship that exists such as economic ties. It creates peaceful coexistence and ensures that it is maintained. According to Molle (2003, p.37), “It brings economic benefits, highlighting the growth of some countries that have opened their markets to international trade and investment. They point next towards the benefits in terms of peace and security.” These are some of the positive outcomes of globalisation.

Globalisation has negative outcomes. One is the price set up for the commodities in trade. These prices set at times cannot be attained by the developing countries due to economic hardships such as global recession. It makes the condition to be unjust leading to exploitation of the peripheral countries. There is also repatriation of profits back to the mother countries if the business was conducted in other countries. This is because individuals and companies who invest in other countries always take the profits back to their home countries e.g. Multinational companies. It also leads to cases of monopolization by the world economies. This is because they are the forces that set up the market price for goods. They control the market. This leads to anguish of developing countries as poverty progresses.

According to Hewa and Stapleton (2005, p. 155), “The negative effects of globalisation can be varied and range from the impoverishment and depopulation of local communities as corporations or factories relocate to optimize competitiveness and unemployment rises.” These are some of the negative reasons for globalisation.


Globalisation is consequently here to stay. It will continue to grow as the world advances into the future. It has integrated a lot of countries and enhanced peaceful co existence among them.


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