Question

Are there any disadvantages associated with globalization? in 150-300 words explain  

Answer 1

Disadvantages associated with globalization are:

1. Inequality: Globalisation has been related to rising inequalities in wealth and income. Evidence for this can be seen in the growing urban-rural divide in countries like India, China and Brazil. This often leads to social and political tensions and financial instability that eventually hinders growth. Many of the poorest people of the world do not have access to public goods and basic technologies and they are often excluded from the benefits.

2. Vulnerability to external economic shocks: National economies are more connected with each other and are interdependent and this increases the risk of contagion, that is, an external event somewhere else in the world can make a country more vulnerable to macro-economic problems elsewhere

3. Threats to the Global Commons: Irreversible damage to ecosystems, deforestation, land degradation, loss of bio-diversity and the fear of permanent water shortage affects millions of the world’s most vulnerable

4. Trade Imbalances: Global trade grows with globalization but so too do trade imbalances. Some nations are running big trade surpluses and these imbalances create pressures and tensions to introduce protectionist policies such as new forms of import control. Many developing nations fall victim to export dumping by producers in developed nations.

5. Unemployment: Concern has been expressed by some that jobs and capital investment in advanced economies drain away to developing nations as companies switch their production to nations with lower unit labour costs and this can result in higher levels of structural unemployment.

6. Standardisation: Some critics of globalisation see a loss of cultural and economic diversity as global multinational brands and giant firms dominate domestic markets in many countries.

7. Dominant global brands: globalisation might suppress competition if dominant global brands with superior technologies take charge of key markets be it telecommunications, automobiles and so on.