Globalization

Chapter 1: Globalization and Chapter 1: Globalization and International BusinessInternational Business

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Globalization :Globalization :

“ “Processes by which goods, services, Processes by which goods, services, capital, people, information, and ideas flow capital, people, information, and ideas flow across national borders.” across national borders.” (Levy)(Levy)


Globalization of Business: A Historical Perspective

In the initial years of human history, there were hardly any formal barriers, such as tariffs or non-tariff restrictions, for the movement of goods .


Concept of GlobalizationConcept of Globalization

The process of integration of The process of integration of

economic, financial, cultural and political economic, financial, cultural and political

systems across the world.systems across the world.


Impact :Impact : Economic impactEconomic impact

• Improvement in standard of livingImprovement in standard of living• Increased competition among nationsIncreased competition among nations

Social impactSocial impact• Increased awareness of foreign culturesIncreased awareness of foreign cultures• Loss of local cultureLoss of local culture



Advantages :Advantages :

Peaceful RelationsPeaceful Relations Most of the countries have resorted to trade Most of the countries have resorted to trade relations with each other in order to boost their relations with each other in order to boost their economy, leaving behind any bitter past experiences economy, leaving behind any bitter past experiences if any.if any.

EmploymentEmployment Considered as one of the most crucial Considered as one of the most crucial advantages, globalization has led to the generation of advantages, globalization has led to the generation of numerous employment opportunities. numerous employment opportunities.


EducationEducation A very critical advantage that has aided the A very critical advantage that has aided the population is the spread of education. With numerous population is the spread of education. With numerous educational institutions around the globe, one can move out educational institutions around the globe, one can move out from the home country for better opportunities elsewhere. from the home country for better opportunities elsewhere.

Product QualityProduct Quality The product quality has been enhanced so as to retain The product quality has been enhanced so as to retain the customers. Today the customers may compromise with the the customers. Today the customers may compromise with the price range but not with the quality of the product. Low or price range but not with the quality of the product. Low or poor quality can adversely affect consumer satisfaction.poor quality can adversely affect consumer satisfaction.


Cheaper PricesCheaper Prices Globalization has brought in fierce competition in the Globalization has brought in fierce competition in the markets. markets.

CommunicationCommunication Every single information is easily accessible from almost Every single information is easily accessible from almost

every corner of the world every corner of the world GDP IncreaseGDP Increase

Gross Domestic Product, commonly known as GDP, is the Gross Domestic Product, commonly known as GDP, is the money value of the final goods and services produced within money value of the final goods and services produced within the domestic territory of the country during an accounting year.the domestic territory of the country during an accounting year.


DisadvantagesDisadvantages Health IssuesHealth Issues

Globalization has given rise to more health Globalization has given rise to more health risks and presents new threats and challenges risks and presents new threats and challenges for epidemicfor epidemic

Loss of CultureLoss of Culture With large number of people moving into With large number of people moving into

and out of a country . People may adapt to the culture and out of a country . People may adapt to the culture of the resident country.of the resident country.


Uneven Wealth DistributionUneven Wealth Distribution It is said that the rich are getting It is said that the rich are getting richer while the poor are getting poorer. In the richer while the poor are getting poorer. In the real sense, globalization has not been able to real sense, globalization has not been able to reduce poverty. reduce poverty.


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