Question

Is globalisation a force for good in the world economy? Discuss with respect to at least three of the following areas. Please include diagrams where possible :

- Migration

- Comparative advantage and gains from trade

- Trade and growth

- Brexit

- Winners and losers from globalisation

- COVID-19

Answer 1

Globalization is a current age phenomenon which is a result of many factors including technology, research and development, trade , etc. The most relevant and important aspect is that of trade. Trade is the core idea from where the process of globalisation was started and now it has become a multifaceted dimension affecting everything and everyone around the world. With globalisation , the World is truly a small place to live in.

Globalization initiated with the interlinking of all the different areas and associations on the grounds of trade. With the coming of trade , the idea of specialization was introduced , which was considered the maximization of the trade profits. With specialization ,the world was dividing the work and maximizing it's production. In ideal world the growth would have been the same, but this is not the case. Some countries grew more than others , providing a more beneficial and hospitable environment for workers to work in . The other factors like high wages , better labour laws and quality of life is also different in different regions of the world , based on the development . Hence , with the opening of economies due to globalisation , the labour started the migration to better work environments , basically to have better standards of living and high wage rates. The outflow was high in developing nations , with average rates of wages and affordability to move out of country. While countries with very less development, cannot move out because of low affordability.

Continue talking about how trade can lead to growth making the countries either developed or sometimes , exploitation of labours can happen on the hands of developed nations , making the poor nations even poorer. Eg. Multinational brands tend to set up plants in poor or underdeveloped countries, pay the labours very low wages and gain super normal profits in the world market. This is a negative aspect to growth and trade . While on other hand the positive aspect is these multinational companies can provide employment to the underdeveloped nations , with efficient labour laws, hence help in growth and development through rising wage rate and capacity of individuals with in the economy. Trade has both Positive and negative aspects , but by and large the trade , though help in growth of the nations but is a boon for capitalist markets and rise the gap between the rich and the poor.

Trade had caused high interlinking dependencies of every nation in the world. With trade countries either acted as major exporters or major importers and hence the requirements around the world were depending on this interlinking mechanism. With the rise of Covid 19 , the world sank into a pandemic , the world trade is coming to almost a halt like situation , as the disease made the trade to stop as an effect of protective measures. The globalisation of goods was at such a high peek , this halt is causing , somewhere high supply of goods forcing producers to sell goods at very low price or high demand , consumer having very less choices and hence paying high rates for regular goods. Globalization balance is distorted for a time being , untile the ways to reduce the impacts of Covid 19 are found . This is a reminder how the world is interlinked and this interlinages are forming our daily tastes and preferences and somewhere motivating more development and research , in order to gain monopolistic profits which can be gained from across the world, as an effect of globalisation.