Unit 1: International Business & Globalization Definition of Business

Globalization debates

Is the shift towards an integrated and interdependent global economy a good thing?

Anti-globalization protests

Nowadays, anti-globalization protests occur at every major international meeting. People stand against foreign producers, lower wages due to competition, environmental pollution and cultural integration.

Impact on jobs and income

Removal of trade barriers may destroy job opportunities in wealthy countries in US and Europe as the companies might shift manufacturing operations to countries where wage rates are cheaper, i.e. India. Lately the same fears have been applied to services, which have been outsourced to nations with lower labor costs.

Impact on labor policies

Critics argue that free trade encourages firms from advanced nations to move their production to less developed countries that lack proper regulations to protect labor and the environment from abuse. As a result, free trade may lead to higher pollution level and exploitation of labor in less developed countries.

Impact on national sovereignty

Critics argue that globalization and free trade shifts economic power away from national governments to the control of global institutions, such as WTO & UN, that restricts the sovereignty of those states and limits nation’s ability to control its own destiny.

Globalization & world’s poverty

Opponents of globalization argue that the gap between rich and poor nations is increasing. In contrast, supporters of globalization believe that the best way for the poor nations to improve their situation is to reduce barriers to trade and investment and implement economic policies based on free market economies.