Impact of Globalization on Poor Society - Essay Example

? Globalization & the World’s Poor Introduction The promoters of economic development take globalization as the blessing to the society. However critics argue although there are benefits from the process of globalization in the form of diffusion of new knowledge it cannot be ignored that globalization have adverse effects as well. The assignment will discuss about globalization and the overall impacts it sheds on the poor society of the world. Globalization The term globalization can be interpreted as the international integration of world views, ideas and other cultural aspects. The promotion of worldwide exchange of natural as well as cultural resources is termed as globalization. Developments in technology and policies over the past few decades have acted to be the catalyst in cross border trade and investment. The current wave of globalization opened up the domestic economies internationally. In the periods after the Second World War the governments of most countries adopted the free economic systems to be the driver of the economy. The free economic regime increased the potential of the states and created new opportunities for trade and investment. With the aim to promote trade and development the government negotiated in reducing the barriers of trade while the new corporations exploited the new opportunities in foreign market by moving into agreements. The economic life was transformed with advances in the field of technology. The definition of globalization has remained controversial. The proponents of globalization argue that the process will enable the poor countries to improve the standards of living while the critics argue that globalization only benefitted the large corporations and eliminated local enterprises out of the market scenario. The resistance of globalization has been from all levels and the government are now engaging themselves in regulating the flow of capital and goods that constitute the wave of globalization. Impact of globalization on poor society It was opined by the critics that globalization serves the interests of the first world countries and in doing so has detrimental effects on the poor society of the world. The unfortunate countries where the amount of economic resources is limited have been than target for globalization. It was thought globalization will bring about an overall welfare for the society. So the society as a whole was supposed to reap the benefits. But after the years of implementation it was founds that the benefits are getting directed towards the developed countries and the less developed countries are remaining under the shadows of darkness. Some argues that multinational corporations enjoy the power over the economies of the world. But it can be argued that it is not the companies that take the advantages. It is the well developed nations that exploit the poorer counterparts through international networking communities. On a cyclical note it can be said that globalization deters protectionism by opening up the borders which facilitate easy flow of ideas and products. Globalization increases the opportunity for self interests and in this fashion pursues the interests of the first world countries with the expense of the third world countries. Therefore globalization acts to cheat the world’s poor. The financial press and the influential officials of the international authorities assert that the global markets expand the dimensions of the poor while the critics hold the opposite position with equal intensity. In the period between 1980 to 2000 the percentage in trade in goods as well as services in China increased from 23% to 46% of GDP. In the case of India, The percentage ranged from 19 to 30% over the same period. The development of the nations created some opportunities for the nations to utilize. But some nations lacked the capability to utilize the situation as there did not have the required political and domestic situation. The idea of free trade rests on the notion that nations should involve themselves in exporting those products in which they are best to produce and import other products. The mainstream economists differ on their opinions on the balance of potential benefits and on the significance of social safety for the poor (Irwin, 2003). Free traders are of the opinion that the rising tide of international specialization has the capability to lift all boats. Others are of the opinion that the poor society is not blessed with the capacity to relocate or readjust with the changing conditions of the market. Scholars believe that the benefits of globalization get accrued in the long run when the resources are assumed to be mobile. But the adjustments can cause some kind of problems in the short run. According to anti-globalizers’ globalization is making the rich richer while the poor are getting trapped within the vicious circle of poverty. The proglobalizers state that globalization is actually helping the poor. On the basis of household data collected by the different agencies, World Bank estimated the number of population below the poverty line for the developing countries to be a crude value. The population earning more than 1 dollar a day was taken to be the benchmark. The level of poverty has taken a declining curve in China and India with few other countries. The percentage of population living below the poverty line for China decreased from 79 to 27%. The rate declined from 63 to 42% in case of India. One can state that the improving conditions of the poor are the resultant of globalization. For the case of China the expansion of infrastructure can be accounted to be the reason for overall development. A substantial proportion of rural development already took place in the middle years of 1980s. The spread of green revolution and the some anti poverty programs from the part of the Indian government can be taken to be the reason for decline in rural poor for India. It cannot be ignored that globalization pulled a major proportion of Chinese out from poverty. But globalization is not the sole factor in development of Chinese or Indian economy. In this fashion if time is lend in examining other economies from the beginning of globalization it can be stated that globalization did act as the driving force for improvement in conditions of the poor. For large economies the tale is little different. Globalization means withdraw of the trade barriers, diffusion of technology and knowledge across the world. It is not a hidden secret that the large economies enjoy the comparative advantage and the innovations in various fields lay down the path for these economies to exploit the less developed or the developing economies. Through the process of globalization the giants of technology got the access to enter into the level playing field of the less developed economies. In this fashion the giants ruled out the local institutions out from the market. These local institutions were mostly run by the middle or lower income earners. Therefore globalization is acting against the idea with which it was implemented. But there is also a brighter side. With the diffusion of new technology the consumers have the options to choose much wider varieties and competition in the markets keeps the prices at affordable levels. The foreign corporations also provide employment opportunities for the skilled poor. The poor people lack access to capital as well as opportunities to learn new skills. With the entry of foreign entrepreneurs into the country the poor are getting benefitted with employment opportunities as well as with knowledge of skills. However the problem is most poor do not have the requisite skills to earn an employment opportunity in the organizations. The flaws in redistribution policies of different countries contribute in making the poor poorer. Conclusion Conclusively it can be stated that the impact of globalization on the poor society of the world cannot be judged by examining few economies. Actually globalization will shed different effects on different economies. The economic conditions of the countries can be held responsible on whether the country will benefit from globalization. In this case it is of certainty that the developed economies are in a favorable position. The conditions in the less developed or the developing economies are not at par with the conditions of the developed economies as stated in the discussion above. Globalization will bring employment opportunities for the poor but it depends on the capability of the poor to get accustomed in the ever changing environment. If they fail to do they cannot find themselves above the poverty line. The countries which have successfully implemented the anti poverty programs will gain from the effects of globalization while the countries which are still following the ad hoc policies will remain poor and the conditions of the poor will become poorer which will act as a constraint for those countries to find themselves on the path of economic development. Works cited Irwin, D. Free Trade Under Fire. 2003. Princeton University Press. Read More