Another Industrial Revolution through Globalization - Essay Example

Introduction Globalization is a process comparable to trans-migration of primitive humans who travelled in search of means for living; this process intensified with the increasing needs of humans and improving sources of living amplified by development of means of transportation, technology, communication; this process is further reinforced by increasing population, demand for commodities, increasing health issues, international crime and justice, environmental processes, poverty and illiteracy. Friedman describes globalization as the overarching international system shaping the domestic politics and foreign relations of virtually every country driven by free capitalism. In the process, it permeates into six dimensions of a nation, namely, politics, culture, technology, finance and trade, national security, and ecology; eventually leading to disappearance of boundaries between these dimensions between different nations (Wells, 2004; p.181). As globalization is a process that has been occurring all over the world, different meanings and definitions have been created based on how people in different regions of the world relate to the changes it brings. In a holistic view, globalization’s reach and spread can be seen in all the six dimensions described by Friedman; however, its intensity, effect, and time vary in different regions of the world. For instance, impact of globalization is seen to be greater on the leading capitalist nations. The process has primarily impacted industrial, financial, economic, political, judicial, ecological, health-related and sociocultural aspects of nations of the world. In addition to these, its secondary effect can be seen in the form of inward and/or outward shift of skill set, knowledge base, talent and craftsmanship through continuous movement of human capital, mostly from developing and underdeveloped nations to the developed nations. Movement of many production and service industries during the last 2 to 3 decades has been in the opposite direction, i.e., from developed nations to others. The primary and secondary impacts are interrelated with each other. Industrial globalization: Considering impact of globalization on industries, researchers have attributed this to the rise of capitalist nations post Civil War (Sherman, 2005). Emerging corporations brought greater financial capital, economies of scale, and improved technology that gradually increased competition in the market. In order to sustain competitiveness, industries had to sort for means of profit maximization; this need resulted in further technological advancements and enhancement of organization systems and procedures as a result of which industries entered the export-import transactions with other nations in terms of products, parts of products, raw materials, labor, etc. Major automobile, textile, and food industries were the initial ones to enter this trend. Increasing competition and the need for sustainability eventually resulted in industries operating through multiple locations, either through mergers and contracts with other organizations or creating subsidiary organizations that provided products and services at lesser cost and greater or similar quality. This process proved extremely beneficial to many industries in the U.S. and was adopted by various industries in many other countries. The trend, now known as outsourcing, permeated into service industries and resulted in unexpected inflow of financial capital into the developing countries. The trend further forced governments of different nations to dilute international laws and introduce policies that could facilitate international trade and commerce. In addition to these, other factors that accelerated industrial globalization include increasing demand from customers, increasing disposable income, advancements in technology and communication mechanisms such as internet and media. Creativity and innovation in technological aspect lead to increased competition among different industries within and between different developed nations, and vice versa. The positive impact of globalization in industrial sectors can be seen in the form of accessibility to a wide range of products and services and for people of all economic classes; increased employment opportunities in developing nations; improved standards of living, and an increasing demand for products and services. Enormous increase in international trade and investments in major sectors such as technology and infrastructure, assets and liquidity, fuel and commodity exchanges, currency, banking, as well as education and healthcare sectors. Globalization process in the form of outsourcing has brought peoples of different countries closer in terms of time and distance; provided enhanced learning opportunities at individual, organizational, political, educational, and spiritual aspects; and, increased the earning potential for populations of developing and underdeveloped nations. The economic growth resulting from industrial globalization provided greater opportunities for large corporations to expand their business into different regions. These multinational industries provided expansion opportunities for other industrial sectors such as banking, hotel, educational institutions, healthcare, and construction and real estate (Sherman, 2005). Simultaneously, these expansions created newer and wider market segments based on customer demands. Although globalization in this era has been quite different from that seen prior to the World War, and has brought about many positive changes in terms of business and economic growth of nations, it also disguised major economic blocks. This downward trend may be attributed to reduction in earning potential in one nation due to movement of production to another nation; reduction in available disposable income with majority of the masses; inability to take or pay loans and taxes; reduction in demand for products and services. Due to low earning potential, affordability in terms of good education and better healthcare also reduces. This further adds to the loss in other sectors including commodity market, banking and investments, and technology and infrastructure. Accumulation of enormous wealth with larger organizations will further increase the gap between different economic classes. At one point, the economic growth of the nation stagnates, creating other issues such as imbalance in political and judicial systems and also on ecology and environment in nations with sudden outburst of industrial activity and population. In addition to the economic imbalance, technological advancements and easy accessibility provide substantial ground for indulging in criminal activities at national and international levels in the form of domestic crimes, money laundering activities, terrorism etc. Learning and communicating opportunities along with efficient technology are known to contribute negatively to the society by helping perpetrators promote illicit activities such as drugs and arms trading, prostitution, child labor and ecological degradation (Krehm, 2008). From a culture perspective, effects of globalization can be seen in people’s eating, living, and working habits; in addition, relationship patterns also have been greatly influenced or largely ‘westernized.’ Implications of globalization are bound to continue in the same pattern into the future, or even expand their extremities in terms of positives and negatives. In my opinion, leaders from all nations need to realize this fact, and work together to minimize the negative consequences. Negative consequences in one region of the world are bound to spread to other regions also; hence, leaders need to identify these potential issues and anticipate their consequences in order to save people from evils of globalization such as imbalanced wealth distribution, terrorism, ecological depletion and its consequences, mortality due to diseases. Conclusion: In conclusion, globalization process forces industries to be more competitive by providing better products and services. It drives governments towards providing realistic and aggressive services in terms of policies, regulations, legislation and leadership for the nation. On the other hand, triggered and enhanced by its advancement, globalization also leads to instability in economy, increase in crime, deterioration of health and average life expectancy. Understanding this trend and anticipating its future pattern are extremely important for nations before taking further drastic steps that provide short-term gains, but conceal the long-term losses for mankind in general. References Krehm, W. (2008). Meltdown: Money, Debt and the Wealth of Nations, Volume 3. Canada: Comer Publications. Sherman, H.J. (2005). The Rise of Global Capitalism: The Concentration and Centralization of Capital on a World Scale. In Berberoglu, B’s (Ed. pp: 19-22) Globalization and Change: The Transformation of Global Capitalism. Lexington Books: U.K. Wells, G.J. (2004). The Issue of Globalization: an overview. In Westerfield, R.E and Abbink, J’s (Ed. pp:179-202) Current issues in globalization. New York: Nova Publishers. Read More