Pros and Cons of Globalization
Ronik & Christina
References
Ronik's References
Federle, J., Meier, A., Müller, G. J., & Sehn, V. (2022). Proximity to War: The stock market response to the Russian invasion of Ukraine.
Johnson, D. G. (2002). Globalization: what it is and who benefits. Journal of Asian Economics, 13(4), 427-439.
Thompson, R. L. (2007). Globalization and the benefits of trade. Chicago Fed Letter”, The Federal Reserve Bank of Chicago, 236.
Erixon, F. (2018). The economic benefits of globalization for business and consumers. European Centre for International Political Economy
6 pros and cons of globalization in business to consider. Business Insights Blog. (2021, April 1). Retrieved February 13, 2023, from https://online.hbs.edu/blog/post/pros-and-cons-of-globalization
Brown, T. (n.d.). Effects of economic globalization. National Geographic Society. Retrieved February 13, 2023, from https://education.nationalgeographic.org/resource/effects-economic-globalization
Christina's References
Archibugi, D., & Pietrobelli, C. (2003, February 12). The globalisation of Technology and its implications for developing countries: Windows of opportunity or further burden? Technological Forecasting and Social Change. Retrieved February 9, 2023, from https://www.sciencedirect.com/science/article/abs/pii/S0040162502004092
Brothers, W. (2020, December 3). A timeline of COVID-19 vaccine development. BioSpace. Retrieved February 10, 2023, from https://www.biospace.com/article/a-timeline-of-covid-19-vaccine-development/
Hosokawa, K. (2021, May 10). How Samsung fell behind TSMC in the race for cutting-edge chips. Caixin Global. Retrieved February 9, 2023, from https://www.caixinglobal.com/2021-05-10/how-samsung-fell-behind-tsmc-in-the-race-for-cutting-edge-chips-101709019.html
Jaffee, D. M. (2005, December 9). Globalization, offshoring, and economic convergence: A synthesis. eScholarship, University of California. Retrieved February 10, 2023, from https://escholarship.org/uc/item/4851990f
Kolata, G. (2021, April 8). Kati Kariko helped shield the world from the coronavirus. The New York Times. Retrieved February 10, 2023, from https://www.nytimes.com/2021/04/08/health/coronavirus-mrna-kariko.html
Shead, S. (2021, November 3). The global chip industry has a colossal problem with carbon emissions. CNBC. Retrieved February 9, 2023, from https://www.cnbc.com/2021/11/03/tsmc-samsung-and-intel-have-a-huge-carbon-footprint.html
Thomas, L. (2021, July 19). Nike could run out of sneakers made in Vietnam as Covid Crisis worsens, S&P Global warns. CNBC. Retrieved February 9, 2023, from https://www.cnbc.com/2021/07/19/nike-could-run-out-of-shoes-from-vietnam-as-covid-worsens-sp-global.html
Viederyte, R. (2009, April 3). Globalization influence on competitive education and knowledge spreading activity. Economics and Management. Retrieved February 10, 2023, from https://www.ecoman.ktu.lt/index.php/Ekv/article/view/9507
Wu, C.-F., Chang, T., Wu, T.-P., Leng, K.-J., Lin, M.-C., & Huang, S.-C. (2022, September 8). Impact of globalization on the environment in Major Co2-emitting countries: Evidence using bootstrap ARDL with a Fourier function. Frontiers in public health. Retrieved February 9, 2023, from https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9493095/#:~:text=The%20process%20of%20globalization%20benefits,and%20environmental%20degradation%20(3).
Negative Impacts
Heavy Interdependence
Although trade and cooperation may be beneficial to a country's economy, heavy interdependence over a long period of time may put a country at a disadvantage. Essentially, when more money is spent on imports over exports, a country is losing money. After Russia’s recent invasion of Ukraine, gas prices across Europe increased by 60%. Europe's dependency on Russia for gasoline eventually led to their citizens having to pay more.
Lost of Jobs
Jobs like manufacturing, would be transferred to other countries where people have lower wages. (Jaffee, 2005)
In 2021, CNBC reported that Vietnam made about 50% of Nike’s footwear production. (Thomas, 2021)
Image from (Thomas, 2021)
Environmental Concerns
As sales increase, production increases.
More resources and more labour is needed, causing an increase in energy production. (Wu et al., 2022)
In 2020,the manufacturing of Samsung chips produced a total of 12.9 million tons of carbon dioxide emissions. (Shead, 2021)
Image from (Hosokawa, 2021)
Positive Impacts
Lowering Cost of Creating Products
Image: One million workers in China work to create iphones. Paid very low wages with 17 suicides last year.
Globalization has changed the lives of first world countries across the globe. Western manufacturers are able to take advantage of low labor costs in countries like China, Indonesia, and India. Goods such as clothes, smartphones, and automobiles are much more accessible in our society. Globalization helped to reduce high inflation rates in Western economies, giving consumers more “bang for the buck”.
Increased global cooperation
Globalization increases interdependence between nations who aren't always friendly. This global cooperation boosts the economies of both countries, giving a mutual benefit. A prime example of this is the cooperation between China and the United States. China delivers goods, while the states deliver jobs. This interdependence is keeping China or the States from raising their conflict. China was the United States’ third-largest trade partner in 2021. In 2021, 8.6% of total U.S. exports of $1.8 trillion to the World were exported to China and 17.9% of total U.S. imports of $2.8 trillion were imported from China.
Spreads Knowledge and Technology
Solutions to artificial intelligence is used to help other countries research. (Viederyte, 2009)
As businesses expand, new technologies can enter a country. (Archibugi & Pietrobelli, 2003)
Moderna and BioNTech researchers used the genetic sequence released from Chinese scientists to develop their mRNA vaccines. (Kolata, 2021)
Image from (Brothers, 2020)
