Globalization Across The World - Dissertation Example

Globalization Across The World Introduction A number of researchers have questioned the homogenous acceptance of globalization across the world. It has been observed that, most nations are highly optimistic about development of global culture and are consequently focusing on rapid regional integration. However, the notion of globalization binding consumers and countries and bringing markets close to a common global forum may hold true from theoretical perspective, but does not hold good from practical point of view. It has further been observed that, neither the world is as integrated as it has been suggested by proponents of globalization, nor globalization is as widespread as it is generally assumed. In this paper, consumer perception regarding globalization will be evaluated so as to understand the pervasive nature of the phenomenon (Ndhlovu, 2012). Literature review The concept of globalization is referred to the process of greater economic interdependence and mutual awareness regarding economic, political and social factors across different nations. The phenomenon of globalization comprises of various micro and macro factors. The micro factors emphasize on personal and global relations where people, ideas and culture are moved between national borders. On the other hand, the macro factors focus on cross border investment and trading, movement of resources and globally integrated supply chain. Both micro and macro factors bear equal importance as their combination is significantly critical as impact of globalization is not uniform with respect to different organizations, countries, regions and individuals (Ndhlovu, 2012). Globalization is extensively related to gleaming sports vehicles, smart phones, tablets, digital revolution, economic networking and trade opportunities associated with economic integration. The proponents of this kind of viewpoints frequently claim that, open markets inculcate competitive organizational culture resulting to economic prosperity and liberty. In context of globalization, the credit of minimizing national borders and lower product cost is often attributed to technological advancement in information flow and communication systems, dynamic expansion of global financial system and financial deregulation. Additionally, it has also been advocated by many authors that, quick adjustments to various changes have the potential to initiate economic growth where consumer will have greater choices and high living standards. However, globalization has been significantly criticized by numerous individuals as creator of financial crisis and for declining employment opportunities. Globalization is also condemned for increased poverty, inequalities, worsening working environment, extended work hours and decrease in overall earnings (Ndhlovu, 2012; Gupta, 2011). Even though it was observed that globalization resulted in rapid technological progress and increase in capital and trade flow, the consequences of globalization induced significant level of uneasiness. It has been reported that, globalization resulting in income disparities between various nations where rich countries became richer and poor countries became poorer. The phenomenon resulted in certain level of development in few developing countries, but most countries faced internal war-like situation due to scarcity of resources. Internationalization is frequently related to market imperfection which can possibly mitigated with strong level of national regulation regarding workforce and work condition within the country. A number of analysts proposed revaluation of liberalization and deregulation policies for the purpose introducing order to the global financial system. However, the financial sectors are resisting various regulatory attempts despite its significant role in global recession and financial crisis (Ndhlovu, 2012). A number of authors have proposed enlightened self-interest in context of globalization instead of myopic self-interest. They have added that, poverty alleviation, income equality and environmental balance are ultimate needs for business development. In other words, equitable globalization is very necessary for sustainable development. They further argued, international rules and regulations are heavily needed for resolving various problems such as global warming, ozone depletion, drug trafficking, illegal immigration and human right abuse, which are directly and indirectly related to globalization. Proponents of enlightened self-interest explained globalization as a complex process with multifaceted economic, social, political and geographical impact (Ndhlovu, 2012). The relationship between national identity and globalization is relatively blurry. In this context, many observers suggested that, globalization have significantly negative impact on national identity of individuals while others have opposite viewpoint. Globalization is defined as the increasing flow of goods and services, capital, information, workforce and Culture across national borders. This definition is a highly debated subject among researchers and authors in context of contemporary social research. The phenomenon has been frequently regarded as a force that has significant role in redefining the state functions and state power in a country. The primary reasons are that, in global village, generating and maintaining a homogenous national identity is a major challenge as individuals are prone to consumption of globally generated goods and services and the globally networked structure does not permit a national government to exert exclusive cultural control over the country and its nationals (Ariely, 2012). It was observed that various surveys regarding impact of globalization on national identity produced mixed outcomes. For instance, in Germany, it was noticed that German citizens with greater exposure to globalization have tendency of exhibiting cosmopolitan attitude towards global governance and foreigners. Similar trend was observed in Britain as well where younger generation have relatively less attachment towards their national identity due to greater exposure to globalization unlike, the older generation. In Australia, it was observed that globalization not only influence conception of national citizens towards national identity, but also their perception regarding indigenous population of the nation. However, it was observed that in European Union attachment towards a nation was relatively strong despite the European identity (Ariely, 2012). According to certain other contemporary authors such as, Cleveland and Loroche, Steenkemp and De Jong and Zhang and Khare impact of globalization can be observed more prominently among consumers in developing countries. It has been further observed by various researchers that consumers from economically developing countries exhibit favorable disposition towards foreign brands compared to that by consumers in developed nations. According to Hsieh, as level of modernity in a market and information exchange increase as a result of globalization, eventually cultural shift is observed. In this context, Craig and Douglas supported the contention and agreed that culture is dynamic in nature that is, continuously changing and evolving (Cited in Gupta, 2012; Gupta, 2011). Liu and Johnson further highlighted that consumers exhibit favorable attitude towards products that has originated in countries with positive image. For consumers belonging to developing nations, countries with positive perception fit the ideal definition of developed nation. Additionally, Elliot and Cameron established positive correlation between level of economic development in a particular country and product evaluation. According to Ruth and Commuri, strong urge of imitating western lifestyle can be observed among individuals from developing nations (Cited in Gupta, 2012). A number of authors also advocated that, globalization also result in consumer acculturation. The definition of consumer acculturation is slightly different from that of acculturation, as it stands for shift in local consumer culture to global consumer culture with respect to certain cultural components (Gupta, 2011; 2012). Durvasula and Lysonski (2008) added that, consumer acculturation can be observed among Indian youths but their study was limited to commodities such as food, music, media and movie. It was also observed that, consumers with higher disposable income exhibit greater tendency towards consumer acculturation. It has already been discussed that, globalization faced mixed reaction from consumers in different nations. Riefler (2012) revealed that it is incorrect to assume that all consumers are attracted towards global brands due to brand name, social class and quality associated therein. The reason is that, recent studies reveal that around 20 percent of consumers in the United States feel strongly against globalization, while 10 percent consumers would rather prefer local alternatives if available instead of buying global brands. It has been ascertained that, consumers generally categorize brands based on their origin; in other words, brands are often prioritized by consumers based on their country of origin. It was further gathered that, classification of brands on the basis of country of origin affects inference drawn by consumers regarding attributes of the products. Categorization of brands based on originating country can be credited to two different theories namely, categorization theory, which has already been discussed and the ‘home country bias’. According to the home country bias approach, consumers perceive domestic products more positively compared to foreign brands (. Riefler, 2012). Globalization emphasizes significantly on encouraging personal, economic and political interaction across nations, while economic globalization stresses on free movement of resources, services, information and capital. However, many authors have advocated that the concept of globalization is more of a theory. Additionally, studies suggest that globalization attitude among people can range between pro-globalization and anti-globalization and since globalization is mostly in terms of business activities by multinational organizations, reaction of individuals is generally targeted towards these companies and respective products and services. Global diffusion of consumption choices often result in development of certain attitudinal responses towards global brands: (a) homogenization (evaluating global alternatives in a conscious manner) (b) localization (favoring local brands extensively compared to global brands) (c) a balanced approach to global and local products and (d) alienation (exhibiting disinterest towards products based on cultural themes) (Riefler, 2012). Riefler (2012) as a result of assessment regarding global brands established that, countries that have relatively larger pro-global consumer segments tend to be attraction point for most multinational companies. Additionally, the study suggests that global positioning result in enhancing competitive advantage of a company in domestic as well as foreign market. The author further established that those consumer who hardly favor economic integration exhibit preference towards local brands. Davis, Lee and Ruhe (2008) explained that, in the globally integrated marketplace, competitive position of companies and countries are significantly influenced by numerous factors. One of these factors that are gaining importance is trust in context of product and services of a corporation. Recent political issues in North Korea and Iraq establish that nations are lacking mutual trust among each other. Additionally, financial crisis that initiated in the United States and affected the global financial sector is another example of declining trust. Despite strong criticism of these corporate scandals, increasing corruption represents a clear example of poor governance. Trust is considered significant for individuals as well as to economies as no company can ever have enough of it. It results in brand loyalty which further helps in increasing brand image of a company and its products. For instance, in developing nations, foreign brands are preferred due to established trust and other traits such as political, technological and economical development (Davis, Lee and Ruhe, 2008). It has already been discussed that, consumer preference is susceptible to origin preference and at occasions, consumers do tend to reject products solely on the basis of origin of the product. However, it has been observed that such stereotype attitude does have some positive impact. For instance, it prevents poor quality products from getting mixed with high quality brands. It has been further revealed that, consumer prefer buying products from trusted source which can be a country instead of just a company. For instance, superiority of German car, advanced nature of Japanese technology and so on reflects consumers’ trust in a country with respect to a particular product. In this context, it is noteworthy that perception of unethical behavior and scandals result in erosion of consumer faith in a particular company, country or market. The authors suggested that, corruption level in a country can be predicted on the basis of cultural variables within the countries. Their variations generally develop from different perception of various organizations in terms of trust (Davis, Lee and Ruhe, 2008). In globalised environment, success of any venture significantly depend on the level of trust the parties share among each other. Since the globalization process is often developed through strategic alliances, the greatest difficulty that an organization faces is finding trustworthy and compatible business partner. Success of an international venture is also determined by the relative level of trust that consumers have in that company and its products. Davis, Lee and Ruhe (2008) identified three cultural dimensions of Hofstede that share strong relationship with corruption level in a country, namely, power distance, masculinity and collectivism. Overall, it can be proposed that consumer perception regarding globalization and global ventures can be enhanced by addressing various issues that have been discussed in the paper so far. References Ariely, G. (2012). Globalisation and the decline of national identity? An exploration across sixty‐three countries. Nations and Nationalism, 18(3), 461-482. Davis, J.H., Lee, M. & Ruhe, J. (2008). Trust: an intercultural comparison of consumer perceptions. International Journal of Commerce and Management, 18(2), 150-165. Durvasula, S., & Lysonski, S. (2008). A double-edged sword: understanding vanity across cultures. Journal of Consumer Marketing, 25(4), 230-244. Gupta, N. (2011). Globalization does lead to change in consumer behaviour: an empirical evidence of impact of globalization on changing materialistic values in Indian consumers and its after-effects. Asia Pacific Journal of Marketing and Logistics, 23(3), 251-269. Gupta, N. (2012). The impact of globalization on consumer acculturation. Asia Pacific Journal of Marketing and Logistics, 24(1), 41-58. Ndhlovu, T. P. (2012). Globalization: a theoretical reflection. World Journal of Entrepreneurship, Management and Sustainable Development, 8(2/3), 95-112. Riefler, P. (2012). Why consumers do (not) like global brands: The role of globalization attitude, GCO and global brand origin. International Journal of Research in Marketing, 29(1), 25-34. Read More