Global Inequality - Essay Example

Running Head: Global Inequality Global Inequality [Institute’s Global Inequality Since few decades, a rapid advancement is observed in the process of globalization that has modified and affected lives of millions of people in developed, as well as, developing countries. In specific, development in the sector of information technology has played a vital and crucial role in advancing globalization, which has changed the attitudes and perspectives of people living in different parts of the globe. Moreover, globalization has resulted in the concept of intellectual and cultural diversity, which was not encouraged in the past century. Furthermore, it has provided an effective platform to developing countries to develop themselves through different available opportunities in this global village. However, it is observed that such globalization has not been very beneficial for many countries, and it has affected them in a negative manner. Specifically, this paper will discuss and analyze some of the significant aspects of effects of globalization in especially developing countries. In the past, developing countries used to await the opportunity of globalization due to its characteristic of boosting economy, as well as, improvement of society standards in the country. However, recent wave of globalization has been quite different due to a number of social, economical, and cultural factors, which has resulted in an economic strain of developing economies due to globalization. In this regard, attempt of globalization has now become a debatable question for the developing countries, which will be discussed in this paper. In order to understand the consequences, it is very imperative to identify some of the pros and cons of the term globalization. In specific, it is observed that developing countries acquire the opportunities to increase their national income through presence of competition in globalized platform. In the result, such countries are able to access the capital on global level, and in other words, capital is not restricted to national level, resulting in greater opportunities for the improvement of living standards. (Prasad et. al, 2003) As earlier mentioned, information technology has played a crucial role in the advancement of globalization, and therefore, globalization allows developing countries to equip themselves with technological tools that are now essential for economic, social, as well as, cultural growth. Additionally, globalization is not only beneficial for countries on national level; however, it brings developmental and promotional opportunities for individuals as well, as an international platform allows them to develop and show their capabilities more efficiently. (Mishkin, 2005) Furthermore, globalization has encouraged the spread of human rights, which has been given a significant importance in developing countries. On the other hand, globalization has brought a number of disadvantages for countries that lack capital, as it is very important to have some capital, in order to survive economically. In addition, some developing countries are lacking skill, which is another drawback, and position of such countries is weakened by the globalization. Furthermore, globalization provides openness in terms of economy; however, it is indicated by a number of studies that developing countries are usually poor with weak states, and thus, such weak states cannot manage openness economically. Additionally, poorer countries give importance to handwork, whereas, developed countries give significance to information technology, which has taken the place and responsibility of humans at a larger level. In this regard, when developing countries enter into the global level, they are exploited consequently. Another major drawback of globalization has been the disintegration of cultural representation. Globalization believes in cultural diversity, which often results in loss of a specific cultural integrity, and domination of culture of a developed country, which has often been criticized by the experts. Before globalization, developing countries used to enjoy national economy in an autonomous manner; however, globalization undermines such autonomy by flexible exchange rates and open markets that have affected the economy of developing countries in an adverse manner. (Brecher & Costello, 1994) A bitter truth of globalization is that it is operated by rich and powerful countries, and in other words, weaker and poorer countries are ruled by dominating countries, and thus, lose their personal honor and uprightness, which affects its citizens and individuals in an adverse manner as well. (Wade & Wolf, 2002) According to several studies, globalization results in a number of benefits for the developing countries. Trade is a significant component of globalization, which is encouraged appreciably. (Birdsall, 1999) Moreover, it becomes essential for a developing country to innovate its products, in order to promote its trading activities, and thus, innovation results in greater productivity. Globalization forces the developing countries to put more efforts for quality productivity, which is not an issue in domestic markets. Incentives are provided by global markets in return of high quality and innovative products. Therefore, developing countries are advanced in terms of productivity, as well a, quality as well. In the last two decades, generation and advancement in export growth has been the major factor of success for developing countries according to some studies. However, it is criticized by some critics that inequality is increased by the advent of globalization, which reduces the opportunities related to growth. According to them, wages given to children are increased due to increment in productivity by export growth, and thus, child labor is encouraged and increased in the developing countries due to globalization. On the other hand, experts have indicated that poverty levels are reduced efficiently in globalization. For instance, growth in rice exports will result in increment in domestic household income due to integration of market economy, (Wade & Wolf, 2002) and thus, such increment will substitute the income coming from child labor. In the result, child labor is reduced and discouraged by globalization according to some empirical evidences. Another significant benefit acquired by the developing countries in globalization is encouragement of foreign direct investment, which allows the countries to develop their economies more quickly with the help of invested capital in the country. Moreover, foreign direct investments facilitate the countries in increasing their export growth through technological application in their production and distribution sectors. Furthermore, privatization is supported and promoted by the globalization. Increment in foreign investments results in increment in privatized companies that provide a platform of promotion and motivation to the individuals in a specific country. (Mishkin, 2005) Privatization in a developing country reduces the chances of government corruption at a higher extent due to power in different hands. On the other hand, developing countries that are not globalized, confront the corruption from government officials, which is reduced through the introduction of globalization. (Brecher & Costello, 1994) In order to understand the consequences of globalization, the paper will now discuss some of the benefits that are usually indicated by the studies. In present era of information technology, it has become an essential step for developing countries to enter into globalization, as a number of benefits are provided by such move. After such move, a large worldly market is provided to the country, and more incentives are acquired, as compared with domestic markets. In the globalized world, development of private institutions are promoted, which encourages a number of foreign companies to invest in the developing countries. After the implementation of globalized policies, a gradual growth is usually observed in economic growth of developing countries. (Prasad et. al, 2003) However, as years passed, improvement is observed in the GDP growth of countries due to their confrontation with global markets and introduction of their currencies to flexible exchange markets. According to some reports, great reduction can be observed in overall poverty level of developing countries after the globalization process. (World Bank, 2000) One of the significant benefits of globalization is foreign direct investments, which plays a vital role in economic growth of a country. In other words, a number of developing countries have been able to become one of the top exporters around the globe with the help of foreign investors that has been possible after the move towards globalization. According to a study, it is indicated that globalization has provided a universal and international platform to not only developing countries, but their employees and individuals as well. As different companies are operating on global level, a universal platform is provided to its employees, which allow them to interact with each other globally, and develop themselves as well, which is a significant advantage of globalization for people living in developing countries. (Brecher & Costello, 1994) Furthermore, economic, social, and cultural growth is accelerated by another step towards globalization, which is performed by memberships in different international organizations that allow its member countries to interact with each other on economic, as well as, social level. In the result, member countries are able to collaborate with each other, in order to achieve objectives on mutual basis. In this regard, economic cooperation is accelerated that allows countries to increase their economic growth in a rapid manner. Despite crisis in developing world, a number of developing countries have achieved their economic goals significantly by globalization. A rapid growth is observed in exports of domestic products in such countries, and thus, trade promotion is one of the other benefits of globalization in the developing world. (Birdsall, 1999) A number of steps toward globalization are being taken by a number of developing countries that are now able to develop economically, socially, as well as, culturally in an efficient manner. Conclusively, it is observed that developing countries acquire an excellent opportunity to grow economically through globalization. Moreover, sovereignty can be enhanced by such growth, which allows the countries to take their own decisions. While the globalization has a number of advantages, some countries are often exploited by multinationals from developed countries, as they take advantage of domestic workers resulting in instability in the society, as well as, economy. Such actions often result in global inequality, which place poorer countries under the reign of powerful and developed countries. In this regard, effective steps should be taken to ensure absence of global inequality, which is quite impossible according to some experts. In this regard, approach of utilizing international sources given by globalization will always remain a debatable issue for future studies. Still, globalization is an efficient source of economic, social, and cultural development for developing countries. The paper has discussed some of the significant benefits of globalization for developing countries particularly. It is hoped that the paper will be beneficial for students, teachers, and professionals in better understanding of the topic. References Eswar S. Prasad, Kenneth Rogoff, Shang-Jin Wei, and M. Ayan Kose. (2003). Effects of Financial Globalization on Developing Countries. International Monetary Fund Press. Retrieved on October 20, 2008: http://www.imf.org/external/pubs/nft/op/220/index.htm Frederic S. Mishkin. (2005). Is Financial Globalization Beneficial? University of Columbia Press. Retrieved on October 20, 2008: http://64.233.183.104/search?q=cache:8FTTErVTyPEJ:www.fdic.gov/bank/analytical/CFR/2005/sept/CFRfall_2005_FMishkin.pdf+globalization+beneficial+for+developing+countries&hl=en&ct=clnk&cd=21 Jeremy Brecher and Tim Costillo. (1994). Global Village or Global Pillage. Boston: South End Press. pp. 67-80. Retrieved on October 20, 2008: http://www.thirdworldtraveler.com/Brecher/GlobalVillagePillage.html Nancy Birdsall. (1999). Globalization and the Developing Countries. Linkages Journal. Volume 4, Number 2. Retrieved on October 20, 2008: http://www.iisd.ca/journal/birdsall.html Robert Wade and Martin Wolf. (2002). Are Global Poverty and Inequality Getting Worse? The Global Transformations Reader. Second edition. Polity Press. pp. 440-446. Retrieved on October 20, 2008: http://www.prospect-agazine.co.uk/article_details.php?id=4982 World Bank. (2000). Poverty in the Age of Globalization. Retrieved on October 20, 2008: http://www.worldbank.org/html/extdr/pb/globalization/povertyglobalization.pdf Total Words: 1599 Words Read More