Globalization Questionnaire - Research Paper Example

Factors of Globalization and its Influences to the Community What is globalization, and what are some of the traditional international trade theoriesthat support the concept of globalization?According to Hill (2009), globalization is the “shift toward a more integrated and interdependent world economy.” It is the process of economic integration of different countries with unrestricted flow of services and goods, currencies, investments among nations. Living in the XXI century would mean living the world of globalization.

Globalization is everywhere around the globe. Nokia phones, products of a Finnish multinational corporation which was assembled in Texas with the chip sets from Taiwan but designed by engineers from India, are widely used by almost everyone in the world (Hill, 2009). Because of globalization, international market or global market came into existence. International or global market then is composed of different countries trading products and services with each other. Companies have been going out of their home countries and starting to build their names in other countries.

This is basically the reason why we see imported products being displayed in supermarkets and department stores such as wines from Italy, gadgets and cellular phones from Asia, and shoes from Germany. Some of the international trade theories that support globalization are mercantilism, free trade, comparative advantage, absolute advantage, Heckscher-Ohlin theory, the product life-cycle theory, new trade theory, and Porter’s theory or the national competitive advantage. List the major drivers of globalization and provide three examples of each Rugman (2009) argued that globalization has four major drivers: market, government, competition, and cost.

Market globalization drivers are factors that usually affect the demand for a specific product or service such as consumers’ common preferences, increasing consumers from different countries, and global market distribution. Governments had taken the initiative to take off international trade and investment barriers and establish free trade. They also reduced trade tariffs and eliminated restrictions in the quantity of products and services to be imported or exported. Globalization is greatly influenced by competition.

For instance, a company might consider establishing a satellite office in another country to deliver their products to foreign consumers. Because of this act, other competitors would also want to go global and promote their companies to diverse markets. Other examples of competitive drivers are increasing number of alliances between multinational companies and increasing globally-centered companies. Almost all companies would want to maximize profit thereby minimizing their costs. There are countries where production and labor costs are remarkably lesser than the other.

That is chiefly the reason why some companies have different production sites all over the world. Cost drivers include technological advances, advancement in transportation, and increasing cost in product development.Explain at least four effects of globalization that affect your community and your organizationForeign businessmen have been going in and out of the country that results in increasing number of foreign companies and products. Some of major impacts of globalization are good while others are bad.

The GDP will be highly affected as it is dependent on the import-export activities of the country. If the country exported more than it imported, the GDP will increase, thus, an advantage to the economic aspect of the nation. Today, there is actually a wide gap between local and international business. Because of globalization, local businesses will apparently have smaller market because multinational firms are already dominating. Most consumers prefer international brand rather than choosing their own product.

Globalization also opens its doors to professionals who wanted to work abroad which is basically the reason why we see foreign workers nowadays. Globalization was also used by these companies to introduce and promote their cultures to other countries with the hope of influencing them. A very good example would be the music industry. The hallyu or korean wave is becoming a hit to US teenagers influencing their actions and preferences. It widens our awareness and changes our wrong perception about other cultures.

Globalization, then, has brought so much to the modern times. Because of globalization, people are able to use the products made from the other side of the world. ReferencesHill, C. W. (2009). International business: Competing in the global marketplace. (7th ed). Boston, MA: McGraw-Hill.Rugman, A. M. (2009). The Oxford Handbook Of International Business. (2nd ed.).New York, NY: Oxford University Press.