Question

(400-500 words)

Globalization is a revolution that rivals the Industrial Revolution in scope and significance but has taken place over a few decades rather than over a century which effect to complex result to the extent of defeating the already achieved developments. Discuss the advantages and disadvantages of globalization and also illustrate the countries that affects most and why?

Answer 1

Advantages of globalization:

(1) Competitive markets reduce monopoly profits and incentivize businesses to seek cost-reducing innovations.

(2)Technology transfer: Developing nations get advanced technology from the MNCs which help in the production process.

(3) Labour Protection: With opening up of the market, the governance improves and lead to labor protection.

(4) Consumers get products from around the globe at a cheap rate due to increased competition.

Drawbacks of Globalization:

(1) Small business: Small businesses perish due to high competition from the MNCs.

(2) Trade imbalance: Developed nations get ahead due to advanced technology which leads to the trade imbalance between two countries.

(3) Inequality: Globalization leads to inequalities in income and wealth. As the rich get richer and the poor get poorer. Example: India

(4) Inflation: Strong demand for food and energy leads to a steep rise in prices of the commodity.

Developed nations get a step ahead as they have advanced technology. So large MNCs have the financial capability to expand their business so small industries in developing countries get perished as they cannot stand to competition from the MNCs. Developed nations assert pressure on developing and under developed nations to open market for all goods to gain market and increase the profit.