Lastly, this evaluation will explain at least four effects of globalization that affect your community and your organization. Globalization DefinedAs defined in the book International Business: Competing in the Global Marketplace globalization is the trend away from distinct national economic units and toward one huge global market. Globalization is a process of interaction and integration between the communities, companies, and governments of different nations. It is also a development driven by international trade and investment and aided by information technology. The globalization process has on the culture, political systems, economic development, environment, and prosperity, and on human physical well-being in societies around the world.
International Trade Theories An international trade theory is a measure to address problems in a country with a weak international economy, high unemployment rates amongst the communities and price inflation. Some types of international trade theories are International Product Life-Cycle Theory, Mercantilism, and Absolute Advantage. International Product Life-Cycle Theory is the theory that shows how a country's export can become its import through different stages. Those different stages are New Product stage, Maturing Product stage and Standardized Product stage.
The next theory is the Mercantilism, which is the theory that believes that a government can improve economic well being of the country by increasing exports and reducing imports. Absolute Advantage is the theory that means a country has total advantage over its trading partners if the country is able to create more of a good or service with the same amount of resources or the same amount of a good or service with less resources. Major Drivers of Globalization There are four major drivers of globalization.Those four drivers are Market, Cost, Government, and Competitive Drivers.
Market Drivers are Common Customer Needs, Global Customers and Channels, Transferable Marketing and Lead Countries. Cost Drivers are Global Economies of Scale and Scope, Steep Experience Curve, Global Sourcing Efficiencies, Favorable Logistics, Differences in Country Costs, High product Development Costs and Fast Changing Technology. The Government Drivers are Trade and investment policies, compatible technical standards, and common marketing regulations.Competitive Globalization Drivers are High Exports and Imports, Competitors from Different Continents and Countries, Interdependent Countries and Globalized Competitors. Effects of Globalization Globalization provides opportunities to communities and organizations.
Globalization influences people to be innovators, designers, and creators of new technologies and concepts. When organizations globalize, it makes more jobs available in the community and globally. Globalization also helps the fast growing world raise its standard of living.Conclusion This is an evaluation was based upon a global questionnaire.
It provided some comprehensive responses about globalization. This evaluation defined globalization and described some of the traditional international trade theories, which support the concept of globalization. This evaluation named some major drivers of globalization and gave three examples of each major driver. Lastly, this evaluation explained some effects of globalization that affect your community and your organization.
