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Globalization , or globalisation Commonwealth English ; see spelling differences , is the process of interaction and integration among people, companies, and governments worldwide. Globalization has accelerated since the 18th century due to advances in transportation and communication technology. This increase in global interactions has caused a growth in international trade and the exchange of ideas and culture. Globalization is primarily an economic process of interaction and integration that is associated with social and cultural aspects.
However, disputes and diplomacy are also large parts of the history of globalization , and of modern globalization. Economically, globalization involves goods , services , data , technology , and the economic resources of capital. Removal of cross-border trade barriers has made the formation of global markets more feasible. Though many scholars place the origins of globalization in modern times , others trace its history to long before the European Age of Discovery and voyages to the New World , and some even to the third millennium BC.
In , the International Monetary Fund IMF identified four basic aspects of globalization: trade and transactions , capital and investment movements, migration and movement of people, and the dissemination of knowledge.
Academic literature commonly divides globalization into three major areas: economic globalization , cultural globalization , and political globalization. The word globalization was used in the English language as early as the s, but only in the context of education and the term failed to gain traction.
Over the next few decades, the term was occasionally used by other scholars and media, but it was not clearly defined.
Since its inception, the concept of globalization has inspired competing definitions and interpretations. Its antecedents date back to the great movements of trade and empire across Asia and the Indian Ocean from the 15th century onward.
In , Karl Marx noticed the increasing level of national inter-dependence brought on by capitalism, and predicted the universal character of the modern world society. He states:. To the great chagrin of Reactionists, it has drawn from under the feet of industry the national ground on which it stood.
All old-established national industries have been destroyed or are daily being destroyed. In place of the old local and national seclusion and self-sufficiency, we have intercourse in every direction, universal inter-dependence of nations. Sociologists Martin Albrow and Elizabeth King define globalization as "all those processes by which the people of the world are incorporated into a single world society. In Global Transformations , David Held and his co-writers state:.
Although in its simplistic sense globalization refers to the widening, deepening and speeding up of global interconnection, such a definition begs further elaboration. Globalization can be on a continuum with the local, national and regional. Globalization can refer to those spatial-temporal processes of change which underpin a transformation in the organization of human affairs by linking together and expanding human activity across regions and continents.
Without reference to such expansive spatial connections, there can be no clear or coherent formulation of this term. A satisfactory definition of globalization must capture each of these elements: extensity stretching , intensity, velocity and impact. Held and his co-writers' definition of globalization in that same book as "transformation in the spatial organization of social relations and transactions—assessed in terms of their extensity, intensity, velocity and impact—generating transcontinental or inter-regional flows" was called "probably the most widely-cited definition" in the DHL Global Connectiveness Index.
It pertains to the increasing ease with which somebody on one side of the world can interact, to mutual benefit, with somebody on the other side of the world. Paul James defines globalization with a more direct and historically contextualized emphasis:. Globalization is the extension of social relations across world-space, defining that world-space in terms of the historically variable ways that it has been practiced and socially understood through changing world-time.
Manfred Steger , professor of global studies and research leader in the Global Cities Institute at RMIT University , identifies four main empirical dimensions of globalization : economic, political, cultural, and ecological. A fifth dimension—the ideological—cutting across the other four. The ideological dimension, according to Steger, is filled with a range of norms , claims, beliefs, and narratives about the phenomenon itself. A second form is agency-extended globalization, the circulation of agents of different institutions, organizations, and polities , including imperial agents.
Object-extended globalization, a third form, is the movement of commodities and other objects of exchange. He calls the transmission of ideas, images, knowledge, and information across world-space disembodied globalization, maintaining that it is currently the dominant form of globalization.
James holds that this series of distinctions allows for an understanding of how, today, the most embodied forms of globalization such as the movement of refugees and migrants are increasingly restricted, while the most disembodied forms such as the circulation of financial instruments and codes are the most deregulated. The journalist Thomas L. Friedman popularized the term " flat world" , arguing that globalized trade , outsourcing , supply-chaining , and political forces had permanently changed the world, for better and worse.
He asserted that the pace of globalization was quickening and that its impact on business organization and practice would continue to grow. Economist Takis Fotopoulos defined "economic globalization" as the opening and deregulation of commodity , capital , and labor markets that led toward present neoliberal globalization.
Meanwhile, he used "cultural globalization" to reference the worldwide homogenization of culture. Other of his usages included " ideological globalization", " technological globalization", and "social globalization". Lechner and Boli define globalization as more people across large distances becoming connected in more and different ways.
There are both distal and proximate causes which can be traced in the historical factors affecting globalization. Large-scale globalization began in the 19th century. Archaic globalization conventionally refers to a phase in the history of globalization including globalizing events and developments from the time of the earliest civilizations until roughly the s. This term is used to describe the relationships between communities and states and how they were created by the geographical spread of ideas and social norms at both local and regional levels.
In this schema, three main prerequisites are posited for globalization to occur. The first is the idea of Eastern Origins, which shows how Western states have adapted and implemented learned principles from the East.
The second is distance. The interactions of states were not on a global scale and most often were confined to Asia, North Africa , the Middle East , and certain parts of Europe. Eventually, technological advances allowed states to learn of others' existence and thus another phase of globalization can occur. The third has to do with inter-dependency, stability, and regularity. If a state is not dependent on another, then there is no way for either state to be mutually affected by the other.
This is one of the driving forces behind global connections and trade; without either, globalization would not have emerged the way it did and states would still be dependent on their own production and resources to work.
This is one of the arguments surrounding the idea of early globalization. It is argued that archaic globalization did not function in a similar manner to modern globalization because states were not as interdependent on others as they are today. Also posited is a "multi-polar" nature to archaic globalization, which involved the active participation of non-Europeans. Because it predated the Great Divergence in the nineteenth century, where Western Europe pulled ahead of the rest of the world in terms of industrial production and economic output , archaic globalization was a phenomenon that was driven not only by Europe but also by other economically developed Old World centers such as Gujarat , Bengal , coastal China , and Japan.
The German historical economist and sociologist Andre Gunder Frank argues that a form of globalization began with the rise of trade links between Sumer and the Indus Valley Civilization in the third millennium BCE. This archaic globalization existed during the Hellenistic Age , when commercialized urban centers enveloped the axis of Greek culture that reached from India to Spain , including Alexandria and the other Alexandrine cities.
Early on, the geographic position of Greece and the necessity of importing wheat forced the Greeks to engage in maritime trade. Trade in ancient Greece was largely unrestricted: the state controlled only the supply of grain. Trade on the Silk Road was a significant factor in the development of civilizations from China, Indian subcontinent , Persia , Europe , and Arabia , opening long-distance political and economic interactions between them.
In addition to economic trade, the Silk Road served as a means of carrying out cultural trade among the civilisations along its network.
The concept of "proto-globalization" was first introduced by historians A. Hopkins and Christopher Bayly. The term describes the phase of increasing trade links and cultural exchange that characterized the period immediately preceding the advent of high "modern globalization" in the late 19th century. In the 17th century, world trade developed further when chartered companies like the British East India Company founded in and the Dutch East India Company founded in , often described as the first multinational corporation in which stock was offered were established.
Early modern globalization is distinguished from modern globalization on the basis of expansionism , the method of managing global trade, and the level of information exchange. The period is marked by such trade arrangements as the East India Company , the shift of hegemony to Western Europe, the rise of larger-scale conflicts between powerful nations such as the Thirty Years' War , and the rise of newfound commodities—most particularly slave trade.
The Triangular Trade made it possible for Europe to take advantage of resources within the Western Hemisphere. The transfer of animal stocks, plant crops, and epidemic diseases associated with Alfred W. Crosby 's concept of the Columbian Exchange also played a central role in this process. European, Muslim , Indian, Southeast Asian , and Chinese merchants were all involved in early modern trade and communications, particularly in the Indian Ocean region.
According to economic historians Kevin H. O'Rourke , Leandro Prados de la Escosura, and Guillaume Daudin, several factors promoted globalization in the period — .
During the 19th century, globalization approached its form as a direct result of the Industrial Revolution. Industrialization allowed standardized production of household items using economies of scale while rapid population growth created sustained demand for commodities.
In the 19th century, steamships reduced the cost of international transportation significantly and railroads made inland transportation cheaper. The transportation revolution occurred some time between and The invention of shipping containers in helped advance the globalization of commerce. After World War II , work by politicians led to the agreements of the Bretton Woods Conference , in which major governments laid down the framework for international monetary policy , commerce, and finance, and the founding of several international institutions intended to facilitate economic growth by lowering trade barriers.
Exports nearly doubled from 8. Many countries then shifted to bilateral or smaller multilateral agreements, such as the South Korea—United States Free Trade Agreement. Since the s, aviation has become increasingly affordable to middle classes in developed countries. Open skies policies and low-cost carriers have helped to bring competition to the market.
In the s, the growth of low-cost communication networks cut the cost of communicating between countries. More work can be performed using a computer without regard to location.
This included accounting, software development, and engineering design. Student exchange programs became popular after World War II , and are intended to increase the participants' understanding and tolerance of other cultures, as well as improving their language skills and broadening their social horizons.
Between and the number of students studying in a foreign country increased 9 times. Since the s, modern globalization has spread rapidly through the expansion of capitalism and neoliberal ideologies. In the late 19th and early 20th century, the connectedness of the world's economies and cultures grew very quickly. This slowed down from the s onward due to the World Wars and the Cold War ,  but picked up again in the s and s. The migration and movement of people can also be highlighted as a prominent feature of the globalization process.
In the period between and , the proportion of the labor force migrating approximately doubled. Most migration occurred between the developing countries and least developed countries LDCs.
It involves cross-border transactions of goods and services between two or more countries. Transactions of economic resources include capital, skills, and people for the purpose of the international production of physical goods and services such as finance, banking, insurance, and construction. International business is also known as globalization. To conduct business overseas, multinational companies need to bridge separate national markets into one global marketplace. There are two macro-scale factors that underline the trend of greater globalization. The first consists of eliminating barriers to make cross-border trade easier e.
Globalization , or globalisation Commonwealth English ; see spelling differences , is the process of interaction and integration among people, companies, and governments worldwide. Globalization has accelerated since the 18th century due to advances in transportation and communication technology. This increase in global interactions has caused a growth in international trade and the exchange of ideas and culture. Globalization is primarily an economic process of interaction and integration that is associated with social and cultural aspects. However, disputes and diplomacy are also large parts of the history of globalization , and of modern globalization. Economically, globalization involves goods , services , data , technology , and the economic resources of capital.
Globalization - Approaches to Diversity. The tendency of economic globalization has its roots in the trauma of the the depression before World War II. American political elites Council on Foreign Relations became very careful to ensure that nothing similar will be repeated Korten Globalization can be seen as a means or system of acceptance and adherence to global problems of mankind Dobrotici The following global issues are considered pressing for mankind:. In the vision the United Nations, the globalization of these issues over mankind is based on the uniqueness of the world economy and it is linked to the fact that they occur in almost all countries containing technical, social economical, political and ecological mutual elements that cause propagation in the chain of the effects that need combined efforts to be solved. Globalization does not work by itself, but through economical - financial policies.
The apparent onset of an era of anti-globalization creates significant challenges for international business IB practice, research and education. This paper aims to discuss the implication of these challenges for IB scholarship. This essay assesses the needs for research in IB in view of the challenges posed by the anti-globalization movement.
Globalisation refers to the integration of markets in the global economy, leading to the increased interconnectedness of national economies. Markets where globalisation is particularly significant include financial markets , such as capital markets, money and credit markets, and insurance markets, commodity markets, including markets for oil, coffee, tin, and gold, and product markets, such as markets for motor vehicles and consumer electronics. The globalisation of sport and entertainment is also a feature of the late 20th and early 21st centuries. Globalisation brings a number of potential benefits to international producers and national economies, including:.
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