Globalisation Disadvantages Essay

Globalisation Disadvantages Essay-1
They do not want to include the free flow labour within the parameter of globalisation set by them. Too many have no voice in its design and no influence on its course.” “We wish to make globalisation a means to expand human well being and freedom, and to bring democracy and development to local communities where people live.” But the advocates of the policy of globalisation argue that globalisation would help the underdeveloped, and developing countries to improve their competitive strength and attain higher growth rates. However, the advocates of globalisation, especially from the developed countries purposely limit the definition of globalisation to only three components, i.e., unrestricted trade flows, capital flows and technology flows.Following the same path India had also adopted the same policy since 1991 and started the process of dismantling trade barriers along with abolishing quantitative restrictions (QRs) phase-wise.

They do not want to include the free flow labour within the parameter of globalisation set by them. Too many have no voice in its design and no influence on its course.” “We wish to make globalisation a means to expand human well being and freedom, and to bring democracy and development to local communities where people live.” But the advocates of the policy of globalisation argue that globalisation would help the underdeveloped, and developing countries to improve their competitive strength and attain higher growth rates. However, the advocates of globalisation, especially from the developed countries purposely limit the definition of globalisation to only three components, i.e., unrestricted trade flows, capital flows and technology flows.Following the same path India had also adopted the same policy since 1991 and started the process of dismantling trade barriers along with abolishing quantitative restrictions (QRs) phase-wise.

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It also leads to creation of a new world order with no national boundaries. Economically, it simply means opening up of national market, free trade and commerce among nations, free flow of labour, capital and technology, and integration of national economies with the world economy.

Politically, it means limited powers and functions of state, more rights and freedoms granted to the individual and empowerment of the private sector culturally it means exchange of cultural values between societies and between nations; and ideologically, it means the promotion and spread of liberalism and capitalism.

(v) Globalisation makes domestic industries of developing countries to become conscious about price reduction and quality improvement to their products so as to face foreign competition.

(vi) Globalisation discourages uneconomic import substitution and favour cheaper imports of capital goods which reduces capital-output ratio in manufacturing industries.

This would result trickle-down effect to reduce the proportion of population living below the poverty line.

(viii) Globalisation enhances the efficiency of the banking insurance and financial sectors with the opening up to those areas to foreign capital, foreign banks and insurance companies. Following are some of these disadvantages: (i) Globalisation paves the way for redistribution of economic power at the world level leading to domination by economically powerful nations over the poor nations. In this way, the imperialist nations gained much at the cost of the colonial countries who had to suffer from the scar of stagnation and poverty. The concept of Globalisation by integrating nation states within the theme work of World Trade Organisation (WTO) is an alternative version of the ‘Theory of Comparative Cost Advantage’ propagated by the classical economists for assuming unrestricted flow of goods between the countries for mutual benefit, especially from Great Britain to other less developed countries or to their colonies.Globalisation originates from developed countries and MNCs based in those countries.Technologies, capital, products and services are allowed to enter from developed countries to developing countries.(iii) Globalisation attracts entry of foreign capital along with foreign updated technology which improves the quality of production.(iv) Globalisation usually restructures production and trade pattern favouring labour-intensive goods and labour intensive techniques as well as expansion of trade in services.In view of the current global recession and financial crisis, there is a paramount importance of global integration.(i) Globalisation helps to boost the long run average growth rate of the economy of the country through: (a) Improvement in the allocative efficiency of resources; (b) Increase in labour productivity; and (c) Reduction in capital-output ratio.One of the important characteristics of globalisation is free trade between counties.It also means absence of excessive governmental control over trade.

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