A number of literatures would define the term “Globalization” as a phenomenon that drastically changed the process of integration and cooperation of various national economies, wherein it involved national economies becoming increasingly integrated and interrelated. Due to its controversial nature, a lot of professionals from various fields constantly argue on the notion of whether globalization in a general sense is beneficial or costly. However, on the point of the view of pro-globalist the phenomenon has brought more good than bad on the world. Pavcnik (2009) argued that the main benefit of globalization is felt by the poor more than any other sectors in society. According to Pavcnik (2009) the lives of people living in distant countries, with the help of globalization, are increasing being linked through the channel of commerce communications either by technology or culture.
Political Benefit: Strengthening Global Ties
The all-encompassing nature of Globalization broke the barriers of nations in a good sense. Looking back 30 years ago, developing countries had relatively high levels of trade protection (Pavnick, 2009). On a political level, globalization has strengthen the ties of nations because of the various policies and mandates lifted in terms of tariffs and taxes on trade and importation. Due to high trade protection it corresponded to countries having high barriers on imports specifically on taxes which resulted to imports quantity being restricted either by licenses and quotas. When the countries decided to abandon the restricting trade policies, the tax on import dropped from over 80% to an average of 30% during the 1990s era (Pavcnik, 2009). Some of the countries that benefited from this change in trade policies included Colombia whose tax on import dropped by 37% (from 50% to 13%). Due to the figures, one of the greatest highlights of globalization came in the form of economic reform which aided uplift poverty levels in different parts of the globe (Akhter, 2004).
Social Benefit: Uplifting lives of the poor and rural areas
Globalization gave rise to job opportunities which of course contributed to the uplifting of the poor (Chan, 2010). For example, workers, both educated and less educated benefited from the export-orientation of many nations. A lot of domestic monopolies have also been broken down due to globalization. These monopolies used to be protected but due to the increasing competition both in the internal and international market, these monopolies met competitions in the form of foreign firms. The foreign firms constituted to more job vacancies and diversity (Bhagwati, 2007).
Without a doubt, globalization has help increase the living standards of the poor because of job and trade opportunities. Rural areas are now being developed to meet the standards and demands of countries and as the result the living standards are now at par with those living in urban areas.
Economic Benefit: Demand and Supply
In an economic sense, when the countries opted to open their trade channels it constituted to a drastic change in growth and living standards. When the introduction of globalization boomed into the world many other elements followed such as macroeconomic conditions and technology. For rural areas, depending on how much globalization involves the concept of agriculture, changed over the course of history with the help of open trade (Akhter, 2004). Vietnam, for example, during the middle of 1990s reported to have liberalized trade. Before the event, Vietnam as a country limited the amount of rice that their farmers exported abroad. The government later on opted to remove the quota, the demand for Vietnamese rice increased together with the price. The increase in both the demand and price resulted to the change of standards of living for the rural farmers. According to Pavcnik (2009) globalization produced both ‘winners’ and ‘losers’ but the world cannot deny its benefit. It is now on the end of the government and the people to utilize the full potential of globalization through the process of continuous improvements in trade policies and practices.
Akhter S. (2004). Is globalization what it’s cracked to be? Economic Freedom, corruption, and human development. Journal of World Business.
Bhagwati, J (2007). Why the Critics of Globalization are Mistaken. Springer.
Chan, A. (2010). Globalization, China’s Free (read bonded) labour market, and the Chinese Trade Unions. Australian National University.Pavcnik N (2009). How has Globalization Benefited the Poor? Yale University.