Globalization refers to the progression by which various areas in the world have been joined together by way of an overall and international set-up of communication, movement and conduction of business. These various regions include financial systems, social orders and civilizations (Pugel, 2004, p.
5). Globalization is in most other times used to make a reference to economic globalization, which is the act of combining into an integral whole of state financial systems into the worldwide economy by way of carrying out of business, far-off direct investment, cash flows, movement and the outspread of expertise and other forms of know-how. Nevertheless, globalization is normally acknowledged as having a driving force which is a blend of trade and industry, technical, socio-cultural, opinionated and natural elements. The term globalization at most times brings out various thoughts from various quarters and this study seeks to shed light on various questions that arise from it. There needs to be a clarification on whether globalization is the amalgamation of financial, opinionated and socio-cultural set ups across the world or it is the supremacy of first world nations in decision making at the expense of developing and less influential countries.
It needs to be established whether globalization is in and by itself a driving force for economic development, success and autonomous liberty, or whether it is an accelerator for ecological destruction, taking advantage of developing nations and repression of human rights (IMF staff, April 2000). Again, it needs to be made clear if globalization is only beneficial to the rich and well-doing states and regions and if the developing world can make a good use of it to perk up their welfare.
History of globalization
The chronological genesis of globalization is the subject matter of current debate. Despite the fact that some intellectuals place the geneses of globalization in the contemporary times, a number of others look upon it as an occurrence having an extensive past. Possibly the greatest backer of globalization as phenomenon with a long historical background was Andre Gunder Frank, a professional economist who did quite a significant amount of work on reliance theory.
He suggested that a type of globalization has been around from the time of the commencement of trade connections between Sumer and the Indus Valley society (John, 2004, p.9). These dealings happened as early as the third millennium B.C. on the other hand, those not in agreement with Frank’s thought make out that it perches upon a wide-reaching description of globalization. An initial type of worldwide financial side and way of life was in place in the times of the Hellenistic era, a period when commercialized town centers were concentrated around the group of countries in special alliance. This was Greek civilization over a far-reaching array that began from present day India to Spain.
Quite a number of significant cities like Athens, Antioch and Alexandria were part of this area perhaps this explains why they are important centers even up to date (Chase-Dunn, 1998, p.7). Business was extensive during those times, and it is recognized as the first instance that the thought of a multi-ethnic and broad-based culture came out. The description of a place as multi-ethnic or cosmopolitan which is inhabited by persons either out of or at home in a number of regions of the world and mainly not regional in mind-sets or interests, was gotten from this. A number of intellectuals have thought it out that there existed an early form of globalization in the form of trade and other dealings between Romans, Parthia’s and the Han. The expanding expression of business connections between these civilizations instigated the growth of the Silk Road. This link commenced in the western region of China and went all the way to the borders of the Parthian Empire and proceeded in the direction of Rome.
With an estimated three hundred ships setting sail amid the Greco-Roman region and India, the yearly trade is approximated to have hit a high of three hundred thousand tons. The Islamic Golden Age was another essential initial phase of globalization. This is the era when merchants of Jewish, Muslim and other explorers set up a continual financial system covering the Old World.
This resulted in a globalization of harvest, business, information and expertise (John, 2004, p.11). Internationally, important crops such as sugar and cotton turned out to be grown on a broader scale across the Muslim nations during this era, whereas at the same time, the requisite of learning Arabic and going through the Hajj fully formed a multi-ethnic way of life. The dawn of the Mongol Empire to a great extent assisted movement along the Silk Road in as much as it destabilized the business hubs of the Middle East and China. This gave explorers and missionaries a chance to move from one end of Eurasia to another. Marco Polo is one of the travelers who gained from this development. The development, popularly referred to as Pax Mongolica also had a number of other noteworthy globalizing results (Guillen, 2001, p.235).
This is the era when the first intercontinental postal service came into existence and on the lower scale the speedy spread of outbreak infections like bubonic plague across regions took place. These forms of global exchange predating the contemporary times are commonly referred to as archaic globalization and were actually restricted to the Old World up to the sixteenth century. The period of technological innovations expanded globalization to a large extent, this being the first time when Eurasia and parts of Africa conducted business with the up-and-coming new world.
It all commenced toward the end of the fifteenth century when the two monarchies of the Iberian Peninsula-Portugal and Castile sent the first tentative expeditions around the Horn of Africa and to the American region. Prior to the turn of the sixteenth century, the Portuguese began coming up with business establishments from Africa to Asia and Brazil. They were mainly dealing in commodities like gold, spices and timber (Guillen, 2001, p.
237). International amalgamation went on with the advent of European colonization of the Americas. There was extensive trade of crops, animals, foodstuff, human slaves, contagious infections and ways of life between the Eastern and Western parts of the world. It was a significant era as new crops from the Americas to other regions led to an increase of world population. This stage of global development is at times referred to as proto-globalization and was typified by the coming up of naval European kingdoms, the Portuguese and Spanish empires, and afterwards the Dutch and British Empires.
Chartered companies began making appearances in the seventeenth century (Baylis, and Smith, 2001, p.28). The first such was the British East India Company, followed by the Dutch East India Company.
These became the initial companies to share risk and allow multiparty possession by way of issuance of shares of stock. This was and still remains a vital tool for globalization. The nineteenth century saw the coming on of globalization come up to its contemporary from.
Industrialization brought about low-priced manufacture of domestic items by the use of economies of scale, while at the same time, speedy population increase brought about sustained demand for these goods. Globalization in this era was with certainty fashioned by nineteenth century imperialism. Following the Opium Wars and the achievement of British conquest of India, huge populaces of these areas turned out to be ready end users of European exports (Baylis, and Smith, 2001, p.
33). During that particular time in history, part of the sub-Sahara Africa together with the pacific islands had been imbibed by the global association. In the meantime, the invasion of new areas of the world, especially sub-Saharan Africa, mainly by Europe brought about natural resources like rubber and coal that were vital in business and investment between the European authorities, their protectorates and the Americas. Business was further enhanced with the developing transport and communication networks at the time. The first stage of up to date globalization began to take shape at the commencement of the twentieth century, alongside the First World War.
Quite a number of quarters associated the fiscal forces of globalization as a major element in creation of the First World War (Chase-Dunn, 1998, p. 32). The definitive crunch moment for this epoch took place for the period of the Gold Standard Crisis and the Great Depression in the early 1990s.
In the mid decades of the 20th century globalization was to a large extent facilitated by the worldwide growth of multinational companies and firms having bases in the United States of America and Europe, and global exchange of new progressions in scientific disciplines, expertise and commodities, with most noteworthy creations and discoveries of this period having their derivations in the Western world. Global export of Western ways of life took place by way of the ever-advancing and increasingly accessible mass media like radio, television and print media. Advancement in worldwide transport and communication played a critical part in contemporary globalization. Toward the end of the 2000s, a larger part of the developed world was hit by a profound recession (Greenfield, 1997). Varying opinions have been floated from a number of quarters and the one that cannot go unnoticed is the idea that the globe has undergone a period of de-globalization following years of expanding financial integration.
Effects of globalization
Globalization presents quite a wide-ranging array of effects to the world.
One of the major areas that have been affected is the industrial sector. When referring to this the main emphasis is on the coming up of international manufacturing markets and wider access to a variety of distant commodities and services for end users and firms. For the most part, focus is on the movement of these commodities and services within nations and world over (Easterly, November/December 2001). The industrial scene has had a remarkable influence as a result of globalization. This has been due to the coming up of international markets and far-reaching access to a variety of distant commodities and services for end users and firms.
For the most part, what has improved is the movement of commodities and services between regions and within national borders. Statistics show that worldwide trade in made up products has risen by more than one hundred times from the year 1955 to present day. The financial sector has experienced a positive effect as a result of globalization. This is mainly due to the coming up of international fiscal markets and improved access to outside funding for borrowers (IMF staff, April 2000). By the early stages of the twenty first century, a figure above one and a half trillion US Dollars in national currencies were traded each day to back the grown altitudes of business and assets. On the other hand, there was a negative side to this as experienced in the financial crunch that the world is currently recovering from. As these global frameworks expanded more rapidly as compared to any transnational regulatory establishment, the unsteadiness of the word fiscal infrastructure radically went up, and the effect is what has been happening since 2007.
The economic sector has had the apprehension of an international universal market, having its foundation on the freedom of exchange of commodities and assets. The interlinking of these markets, on the other hand, meant that a monetary fall down in one sector could affect other sectors. With globalization, firms can turn out commodities and services in the least cost location (Greenfield, 1997).
The outcome of such decisions is the transfer of employment opportunities to cheap locales in terms of trimmed down remunerations and the accompanying employee gains and rights. Manufacturing establishments have in more times than not had to relocate to areas governed by less strict environmental contamination regulations or staff rights and gains. On the international level, healthcare is more of a product. Globalization has had an impact on health policy world over. In the developing world, healthcare frameworks are normally split and privately ran. International healthcare policy crafters have moved from United Nations players to fiscal entities currently. The effect of this alteration is an upshot in privatization in the health division. This splits healthcare procedures by herding it with many stakeholders with as many concealed interests.
These split up policy stakeholders lay emphasis on joint ventures and particular intercessions to deal with particular problems, which is not the case with all-inclusive health plans. Again as a result of globalization, the health sector is mainly guided by technical and hi-tech advances and modern medical trade (Easterly, November/December 2001). International priorities are in most times at loggerheads with state priorities where augmented healthcare infrastructure and fundamental primary care are of a higher worth to the populace than privatized healthcare for the well-off. Globalization has had a major impact on the political scene, and indeed a number of people have use the term globalization to imply the formation of a global regime which controls the relationships among states and warrants the rights coming up from societal and monetary globalization (Pugel, 2004, p.52). The United States of America has had a place of power and great influence among the world powers.
This is mainly due to its well-built and well-to-do economy. China is another good example since with the help of globalization and mainly that of the US economy it has had a remarkable development within the past decade. If the predicted growth trends of that nation come to be realized then they will be at par with the powers that be in the next twenty years. Another political effect is the alteration of sovereignty. Globalization has a role to play in the change and reduction of categorization and extent of state self governing powers. In addition, it is a two-pronged exercise; on one side, the elements are building up that rather undercut the state’s self govern, on the other, a number of nations with intent limit the extent of their self rule (Baylis and Smith, 2001, p.57).
Information movement and transfer has gained a lot from globalization to the effect that more data of all forms is able to flow world over and reach even the most remote regions, thanks to fiber optic communications. There is competition in almost all sectors, especially those dealing with production and value addition processes onto commodities. The business market is now global and for anyone to survive they need to offer quality services and commodities. This is particularly good for all consumers and the general economic landscape. The ecological impact of globalization is a major concern for the safety of all people.
The main reason is due to the coming on of global ecological challenges that might be worked out with worldwide collaboration, like climate modification, cross-border water and air contamination, over-exploitation of water bodies and dispersion of invasive species (IMF staff, April 2000). Many industrial units in the developing nations are set up with inadequate environmental regulation. The resulting globalization and free trade cause a rise in pollution of the general environment. The cultural sector has experienced a great impact from globalization as a result of cross-cultural associations between various people. With this has surged the aspiration to enhance one’s living standards and get a feel of far-off commodities and ideologies (Greenfield, 1997). This has enhanced development of areas formerly considered to be behind as they are in the process of catching up with modern expertise and practices.
Negative effects of globalization
Globalization has elicited considerable international resistance over disquiet that it has led to a rise in inequality and environmental degradation. They is also concern that globalization has negatively impacted culture (Guillen, 2001, p.
252). The issue here is that the powerful nations and economies stand to erode the other nations’ cultures. Exploitation has been reported in instances where the well-to-do nations or establishments set plants in poorer countries with the aim of utilizing cheap labor in their production. Workers in poor countries normally do not have a choice and have to work for low pay just to sustain their lives.
Brain drain is a serious problem in the developing world. Talented and bright individuals usually move to richer countries in search of better opportunities which their native lands cannot provide (Guillen, 2001, p.252). Statistics show that the African continent has been losing over four billion US Dollars yearly in the employment of its native professionals overseas.
As the Second World War nearly drew to a close, delegates from the United States, Great Britain, France, Russia and forty other nations had a convention at Bretton Woods to lay the groundwork for the international monetary order in the period after the war (IMF staff, April 2000). The intention was to avoid another global financial crunch like the Great Depression that impacted negatively on the United States of America and the greater Europe and had a role to play in the rise of the war. The International Monetary Fund and the World Bank were thus created to avert future financial crises and to reconstruct economies brought to their knees by the Second World War.
The convention approach concentrated on what were seen to be the two major roots of the pre-war economic slump and impediments to future world development. The unavailability of steady monetary markets all over the world that led to the war and the devastation brought about by the war itself was also addressed. The International Monetary Fund, popularly referred to as IMF, was tasked with stabilizing international fiscal markets and national currencies by providing the resources to set up safe and sound fiscal policy and exchange rate regimes (IMF staff, April 2000). The World Bank on the other hand was tasked with reconstructing Europe by smoothing the progress of investment in rebuilding and expansion. Another institution that is normally considered to be a globalization institution is the World Trade Organization, commonly referred to as WTO. It is an entity that seeks to oversee and liberalize global trade. It formally began at the beginning of the year 1995.
It is tasked with guiding trade between nations that have a stake, provision of a scheme for bargaining and officiating trade treaties and a disagreement resolution body between any warring partners (Easterly, November/December 2001). All the above three bodies’ activities are geared toward enhancing globalization. This is mainly why opponents of globalization are not in support of these organizations’ activities, citing the negative effects of globalization.
The ‘free trade’ debate
Trade enables people make personal resolutions as regards to their own wellness. This calls for a different approach to the conventional beliefs that the administrations of various nations are the best placed to dispense commodities and services to it populace (Guillen, 2001, p.258). In the 80s’ decade, the liberal capitalist guiding principles of Ronald Reagan and Margaret Thatcher served to do away with trade restrictions and business bylaws as privatization and trade liberalization was established to be a more constructive means to dole out gains and resources to the general public. The operations of globalization as a process are in agreement with privatization and trade liberalization.
However, those opposing the whole process would like state administrations to control the distribution process.
Globalization is on a higher scale a positive phenomenon in as much as it bears some negative effects. Emphasis needs to be laid on the constructive side while efforts should be put in place to avert the negative effects (IMF staff, April 2000). The issue about some nations being excluded made poorer as a result of globalization needs to be clarified. These economies do not stand to get impoverished by globalization, but rather they are vulnerable to being kept out by it. Study shows that a majority of these states have made it difficult and even impossible for the outside world to get access to them.
They have thus jeopardized their own development. There are four elements of globalization that stand to aid developing nations attain self sufficiency. These are trade, asset movements, populace movements and the spreading out of information and expertise. Buying and selling makes it possible for people to swap over labor, commodities, land, services, expertise and is an effectual means of placing all the aforementioned into the populace’s control rather than having a centralized control point. A good illustration of this is a look at the nations in Asia which are being touted to be the future economic powerhouses.
These include China and India which export for the most part manufactured commodities and have made it possible for global trade to take place within their borders.
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