Technology And The Global Economy - Essay Example

Technology And The Global Economy Abstract The detailed essay on the topic “Technology And The Global Economy” has been researched through various sources including news articles, printed books, and authentic online sources. By reading the matter thoroughly, it will be understandable for an individual that how globally the economy of the whole world is affecting, whereas customers or entrepreneurs employed or doing business of their own, in the country far off. Hence, when the government of that particular country is doomed in debts, the private business of multinational companies are also identically infected. There are several factors of which globalization effects the economic system but some major factors are discussed below that includes cultural changes which is the main attribute in influencing the globalization, albeit, a culture itself has immense attributes namely; belief, values, morals, rituals, customs, language while these are the psychographic contents. Therefore, demographic aspects include race, color, creed, birth rate, mortality rate, population size, etc. I have explained the culture in detail because when you sell your products and services in some other parts of the country when the living style and values are completely different then it gets difficult to be compatible and sell according to the needs of consumers. Introduction As the term “globalization” is concerned we come to know that the whole world is now interconnected due to various private firms from outside the world investing their valuable assets far off in other parts of the world by gaining perfection to achieve the greater output with the optimum profit therein. Henceforth, any country specialist in any product or services should sell the maximum output to other countries in order to be competitively renowned and make an economy to be perfect by catering the external threats to overcome when dealing in business with the other countries. Therefore, globalization has made the world interconnected due to advancement in communication, transport system, internet technologies, trade systems etc. albeit, different sort of organizations doing far off businesses are now connected with each other and spreads the mobility of various goods and services due to mingling of different cultures the societies is becoming vulnerable in following old traditional myths happening in particular region. Whereas due to globalization international trade, foreign transactions and investments, money exchange have been crucial in multinational companies or organizations and those who are doing businesses not in its original country. The losses and profits incurred by any firm faces the global era that eventually impacts the economic system. For example, the U.A.E debt issue is the major burden for the countries whose native organizations are functioning in that particular country. History: From the historical point of view: The Hellenistic civilization of Alexander the great emanated from Greek classical heritage had stretch its territories across the globe reaching to Egypt, India, Tajikstan and Afghanistan which introduced mixed marriages that brought the world closer to each other by understanding and mingling of different customs. (Anonymous, 2009) Indicators for globalization in the economy: Following are the necessary indicators responsible in the globalization of economy given below: Cultural impacts Political conditions Climate Nutrition Technology Legal Recommendations Education Religion Understanding Marketing Terminologies Customer Relationship 1. Cultural impacts: The culture is a major source affecting globalization in the economy; it is defined as behavioral patterns, rituals, beliefs, ceremonies, rites of a human being living in particular vicinity. Before understanding the particular behavior patterns of any country it is a disaster of your business in order to gain profits while the investments are made. For example alcohol is forbidden in the Islamic world, if any one willing to intoduce the top brand of alcohol openly in any Islamic country for the purpose of market share then that particular effort is useless. Whereas in some cultures 10.A.M. means in the morning as they do not care about exact figure of the clock. It is highly crucial to know about the cultural terminologies of your customers with whom you are dealing with. People is now investing in the firms which are not the part of their culture but understanding the needs of particular segmentation of customer in order to achieve profitable output by taking various information on studying the culture of different societies dwelling in respective country abroad. (Kogut et al, n.d.) The Article by Emmnual Ngomsi viz; Yan-Koloba, an educational and community activity deals in educating its workers in understanding the culture of various organization for achieving efficient output in the business to be dealt in. (Emmnual Ngomsi, n.d.) 2. Political conditions: The politics of any country or an organization plays a major role in globalization to be successful in the economy as a whole. By the term politics we mean to say power in action (A capacity to influence the behavior of others); hence when the employee in an organization gains power then he/she may act according to the particular behavior. Anyone in power tends to be dictatorial, democratic, etc. whereas it is pertinent to know about the politics in order to work within the conditions surviving. Those unaware of the political behavior of any country or organization are unable to survive further and have to pay huge cost. In free and open trade market unskilled workers with an earning of high wages suffers huge losses. Firms avoid investments in the economy of any country where the suffering from political instability is high. (Stephen P. Robbins, San Deigo State, n.d.) Marxist says, “The effect of workers as a group is to protect the real wage of the workers and the general level of real wages depends on the other forces of economic system.” 3. Climate change: Analyzing climate change in the whole world due to global warming left dangerous impacts which in terms are very tragic for the poor countries who are unable to cope up with drastic change in the climatic conditions of the world. Now to set up a profitable business it is inevitable to understand the strong climatic impacts. Some facts about the climate change according to the updates of the year 2007 which is decreasing the productivity of a country individually are as follows: Human activities involved in burning of fossil fuels. Cutting trees for the making of wood purpose is doing profitable business. Immense pollution in the atmosphere - emission of carbon in access amount. Rising sea levels in the developing world is enormously dangerous. (Anonymous, n.d.) US and Japanese government has signed a document which highlights the impact of international trade on carbon emissions and recommends new policies in order to prevent the huge cost of worst climatic conditions affecting the whole world. (Harris and Goodwin, n.d.) The United Nations has designed a brief report on how the climate effects today are economy in the global perspective. It has warned organizations, factories, manufacturing companies that the world is still unaware about the cost of global warming ethically and productively and also warns that the gravity issue may hinder the effectiveness of businesses engaged in producing profitable goods and services. Some major facts are discussed below: 1) Economic losses due to natural disasters are doubling every ten years from now. 2) In the coming decade annual losses are figured of approx. 150 billion US Dollars. 3) The Kyoto Protocol has urged many industries to avoid carbon emissions by 2012. 4) By ensuring future economic development the financial sectors of United Nations has developed market driven departments for sustainable improvement in curbing the losses of climate change. For example the estimates are around 2 trillion dollar by 2012 and 1.9 trillion by 2020. 5) Developing countries are at major risk because of lack of financial capability available. 6) The climate may warm faster than previously thought as weather changes are major cause. 7) The green house gases creating a major problem, hence forth industries should cut the emissions that can be sustained by sixty percent. 8) The experience of insurance industries states that even the change less than ten percent may lead to disastrous climatic change. 9) The opportunities and threats of financial services industry has been planned in detail. (Anonymous, n.d.) 4. Nutritional Factors: Food is the basic need for an individual who tends to survive because of scarce of food resources and now a days it has become peculiar for the developing world in order to use specialized for saving stocks of food. Developing countries rich in agriculture have also become vulnerable. Due to which the food prices has been risen and it is hard to pay for a developing world which also affects on the causes of epidemic diseases just like the news given by the United Nations on 29 November 2009 says, “ Good Nutrition Makes HIV Treatment more effective”. (Anonymous, n.d.) Special food products which the United Nations seems to be essential to overcome malnutrition are pulses, oil, sugar, iodized salt, wheat and flour specifically. (Anonymous, n.d.) 5. Technology: The world is a dependent element of technology in order to compete with the global world because the advancement of technology has thrown a deep impact on the mindsets of every individual. Hence the cut throat competition all around the world is gaining comparative advantage with the access of technology. Due to globalization each and every individual is thriving for efficient and productive output. Without the help of adopting the technological change an organization would not be affective for itself and for the world as a whole because this is not just an era of survival of the fittest. For example due to technological advancement factories can buy raw materials from any part of the world, manufacture it through the specialized labor involved and may sell it anywhere where the sellers demand high price for the particular product. (Frank and Bernanke, n.d.) 6. Legal Recommendations: Legality in a specific environment encourages the country to advantage in specialization through wise investments, acquiring useful information and skills, produce goods and services, etc. where the cost of spending is much lower than the opportunity of produced output. For example, the real estate business in the world of globalization brings huge profits and losses due to high intensity output. Those investing in property should understand the clarity of documentation provided by the respective government’s legal agencies and also detailed survey is inevitable where the given property should not to be invested by any other individual or an organization because that may lead to a political instability. (Frank and Bernanke, n.d.) 7. Education: The term “education” is a necessary aspect that affects economy of a country on global perspective. Investing in human capital is the major source of educating everyone involved in producing effecting goods and services in order to gain comparative advantage through brain storming attribute. Specializing in human management resources enables a respective individual that how to produce profits from scarce resources available with lower cost of inputs involved. Mr. David Brooks in NY Times says that apart from scholarly education we should keep upgrading ourselves in second education means gaining emotional knowledge is most important than the knowledge we have acquired from theoretical/scholastic sources as the information transmitted directly through unconscious means is the by-product of search which is indirect. (Brooks, 2009) 8. Religion: Religion is different from culture living in any particular vicinity but now a day it has become a root cause for the economic system in the global world. Historically religious fighting all over the world exist since the racism has been developed as soon as after the invention of societies came into being. After the incidence of September 9/11 in the United States of America the differences especially for Muslim world has been emphatically emanated and now exist in every part of the world. For example Swiss government had introduced a ban on minarets designed on mosques which tends to be a religious monument. These are the conditions that may hinder investments made by the Muslim world in especially those countries that bring emotions in the way of gaining profitable business. (Cordone, 2009) 9. Marketing Terminologies: It is very crucial for a business prior to investments made in any particular field of business is to first of all understand the needs of public demand or else the supply of products or services which do not tempts any individual for purchases emanates an immense loss and bankruptcy of a respective business. Scarce availability of resources has enabled an individual or a company to make a logical purchase due to awareness of various products and services and authentic researches available through reliable sources. This has made the supplier cumbersome in producing competitive product or services caused by advancement and increment in globalization affecting the economy as a whole. Marketing terminologies now are not been fixed to product, price, place and distribution only as market oriented individuals are focusing high on the emotional aspects of buyers in order to make business profitable. (Gobe, n.d.) 10. Customer Relationship: The global economy has become customer oriented as the effects of globalization has penetrated the minds of individuals in every aspects, losing a single customer may cause an organization bankrupt because remember the world is now connected. It takes just seconds to switch your buyers or sellers. India’s senior business director Sudarshan Rajan and business group head Ramaswamy Ranganathan says that the advancement in customer relationships by understanding the tradition of a society and focusing on individual needs of a customer has made the banking business profitable in India quoted the term for banks as ‘game breaker’ or ‘game changer’ for targeting emphatically on marketing techniques. (Anonymous, 2009) Summary: Globalization spreads the ideas of individuals and let them understand each other and cope up with the differences thereon by analyzing external threats and opportunities. The cities in the third world are growing profitably very quickly; it is all about their techniques on selling their services or product by understanding the needs of consumers proactively overcoming the restraints. The interaction of people through various technical sources and the exchange of products through active communication systems has led the way to globalization in the economy of the world and various mediums comes underway through SWOT analysis. This is the reason due to which rural areas have no importance in the current era as per expansion of technological advancement and affecting everyone across the globe. In the technical sense no region or country is now isolated. (Glaeser, 2009) Views on globalization effecting the economic system: Dani Roderick, a Harvard professor of an international political economy says that no country can survive in the closed markets which in terms lacks in forming globally profitable. (Suellentrop, 2007) Mr. Paul Krugman says in the New York Times that world has turned out of balance due to trade imbalances weakening policy of currency in China. (Krugman, 2009) Questionnaire: Q1. What the “term” of globalization actually mean in the twenty first century? Q2. How does culture effects globalization in the economic system? Q3. How much old is term of globalization after the existence of life? Q4. What happens if any country is politically unstable and how much does it impacts on multinational companies? Q5. If the government of any country has allowed various multinational companies for doing private businesses and different projects hired on credit by the specialist companies abroad then what happens if the loan is not returned on time? Q6. What are the impacts of open and free trade in the era of globalization? Q7. How much necessary is to specialize when the economy is globally competitive? Will too much specialization benefit the economy? Q8. Is it good for a dictatorial organization or any company to survive globally? If then what are the factors? State any live example. Q9. Is the twenty first century an era of marketing and customer building relationships? Should it help in the boost of an economy? Q10. How much does oil producing companies and the weapons of mass destruction affects those who want to become or remain a super power? Does the power remains in the same hand for centuries? Brief in economic terms if you think it is the matter of economics. Q11. According to tactically thinking will the Muslim world survive economically in the near future? Q12. Gaining market share by producing cheaper goods and services in different parts of the globe does make the currency valuable. Q13. Piercing in climate change issues have affected the economic system across the globe, hence what is the future of leather and tanning industries, factories or organizations harmful for the adverse climate disruption. Will the United Nation or Non Governmental Organization provide financial aid as poor countries become worst for survival? How much is this issue in the perspective of economic system? Q14. It is the fact that technology has brought the country closer to each other through which the word of globalization has evolved eventually. Does it has any discrepancies? If than how much intense do you feel it is? Q15. Can any of the organization survive for the purpose of its own cause by being isolated? If Yes or No please verify the facts. References Anonymous. Globalization of the Economy. (n.d.) http://www.globalpolicy.org/globalization/globalization-of-the-economy-2-1.html Accessed December 3, 2009 Anonymous, Globalization Not the West vs. The Rest, The New York Times, Idea of the day, 2 Dec, 2009. http://ideas.blogs.nytimes.com/2009/12/02/globalization-not-the-west-vs-the-rest/?scp=1&sq=globalization&st=Search, Accessed December 3, 2009. Anonymous. DNA Read The World, Customer Driven Approach Will Be The Game- Changer For Banks, Tuesday Dec 1, 2009: http://www.dnaindia.com/money/report_customer-driven-approach-will-be-the-game-changer-for-banks_1318600, Accessed December 3, 2009. Anonymous, Scientific Facts on Climate Change 2007 Update, (n.d.) http://www.greenfacts.org/en/climate-change-ar4/index.htm, Accessed December 3, 2009. Anonymous, United Nations briefings on climate change, (n.d.) http://www.unepfi.org/fileadmin/documents/CEO_briefing_climate_change_2002_en.pdf, Accessed December 3, 2009. Anonymous, What high prices mean for WFP, World Food Program, (n.d.) http://www.wfp.org/node/7904, Accessed December 3, 2009. Anonymous, WFP’s food basket, (n.d.) http://www.wfp.org/nutrition/WFP-foodbasket, Accessed December 3, 2009. Bruce Kogut, Stockholm School of Economics, (n.d.) http://www.jstor.org/pss/155133, Accessed December 3, 2009. Claudio Cordone. The Call from the Swiss Minaret, the New York Times, December 1, 2009 http://www.nytimes.com/2009/12/02/opinion/02iht-edcordone.html Accessed December 3, 2009 Chris Suellentrop, Global Capitalist, Heal thyself, The New York Times, March 30, 2007. http://opinionator.blogs.nytimes.com/2007/03/30/global-capitalist-heal-thyself/?scp=3&sq=history%20on%20globalisation&st=Search David Brooks. The Other Education, The New York Times, November 26, 2009 http://www.nytimes.com/2009/11/27/opinion/27brooks.html?scp=2&sq=education&st=cse Accessed December 3, 2009 Emmanuel Ngomsi, Learning about cultural differences is a key to success in global business, (n.d.) http://yan-koloba.com/articles.html Accessed December 3, 2009 Edward L. Glaeser, Why Globalization Has Led To Bigger Cities, The New York Times, May 19, 2009. http://economix.blogs.nytimes.com/2009/05/19/why-has-globalization-led-to-bigger-cities/, Accessed December 3, 2009. Ing. Mansoor Maitah Ph.D., How culture affects your business, (n.d.) http://www.maitah.com/wp-content/How%20culture%20affects%20your%20business.pdf, Accessed December 3, 2009. Jonathan Eaton. Technology and the Global Economy, (n.d.) http://www.nber.org/reporter/summer99/eaton.html Accessed December 3, 2009 Jonathan M. Harris and Neva R. Goodwin, Climate Economics, The Twenty first century Macro-economics in GDAE (Global development and environment Institute at Tufts University), (n.d) http://www.ase.tufts.edu/gdae/policy_research/ClimateChange.htm, Accessed December 3, 2009 MarcGobe, Emotional Branding, The new paradigm for connecting brands to people, (n.d.) http://marketing.about.com/od/brandstrategy/tp/top5branding.htm, Accessed December 3, 2009 Paul Krugman, World Out of Balance, The New York Times, November 11, 2009 http://community.nytimes.com/comments/www.nytimes.com/2009/11/16/opinion/16krugman.html?scp=1&sq=views%20on%20globalization&st=cse Robert H.Frank, Ben S. Bernanke, Principles of Economics, 2nd Edition McGrawHill Publishers (n.d.), pg#517,520. Accessed December 3, 2009 Stephen P. Robbins, San Deigo State University, Organizational Behaviour, chap.# 13, Power and Politics (n.d), page# 366,374. Accessed December 3, 2009 Read More