Globalization Questionnaire - Essay Example

Globalization Questionnaire What is globalization, and what are some of the traditional international trade theories that support the concept of globalization? Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. (Globalization101, 2010)Globalization is bringing the world closer. Due to Globalization, people can buy and sell stuff from different parts of the world; they can transfer money to any part of the world in the flash of a second as well.

People from different parts of the world now know about other parts of the world as if they have been there or such that they live there. Globalization has turned the world in a village where everyone is aware of what is happening in every nook and corner of that village. Some of the international trade theories that support globalization are (Globalization101, Doc file):World system theoryComparative advantageFree tradeAdam Smith theoryMercantilismAbsolute advantageInternational product life cycle theoryHecksher-Ohlin ModelNational competitive advantage: Porter’s DiamondList the major drivers of globalization and give three examples of each.

 Following are major drivers of globalization (Grin, 2005)1) Technological drivers InternetTransportationAdvancement in technology2) Political drivers TariffsQuotasEmbargoesPolitical stability3) Market drivers SavingsInvestmentsDemand4) Cost drivers Lifestyle of the people where the company is operatingLabor costsProduction costs5) Competitive driversGlobal competitionGovernments giving subsidies to their firmsExplain at least four effects of globalization that impact your community and your organization.1. Effects on employmentIn some countries, due to globalization there is a positive impact on employment on others there is a negative impact.

When companies shift their business to countries where labor costs are low then there is an increase in unemployment in the country where the company functioned formerly and an increase in employment in the country where the company shifts its business to. In this case, the organization faces positive impact because due to reduction in labor costs, this company will increase its profits.2. Increase in competitionDue to increase in competition the quality of products improves, the local organizations have to face more competition and they might have to increase operational costs etc in order to gain competitive edge in the market.3. Economic growthDue to increased competition there is growth and improvement in economic conditions.

The company might increase its profits if it stays ahead in the competition. 4. Improvement in standard of living of peopleSince quality of products increase and people get better products due to increase in imports, therefore the standard of living of people improves as well.ReferencesGlobalization101. What is Globalization. Retrieved from http://www.globalization101.org/What_is_Globalization.htmlGlobalization101. Global Business Strategies. [doc. File]. Retrieved from www.globalization101.org/.

/File/Global_Business_Strategies_eldridge.docGrin, 2005. Driver of Globalization: Integration of theories and models. Retrieved from http://www.grin.com/en/e-book/57026/drivers-of-globalization-integration-of-theories-and-models