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Topic：The advantages and disadvantages of Economic Globalization. Who is winner? Developing country or developed country?

Economic Globalization

With development of transportation and communication, the economic globalization has impact social life more and more deeply. The process of economic globalization was begun from the 80's, move to the 90’s; it is a particular term of accelerated process of world economy globalization. Generally, globalization is conducive to the rational allocation of global resources, on the other hand, it also means opportunities and challenges to the underdeveloped regions. In this essay, world economic globalization will be the main theme, and it will discuss the benefits for the rich countries at first part. Secondly the challenges and suggestions will be mentioned as well. Finally, there will be a conclusion at end.

Firstly, economic globalization is initiated by the developed countries. It is a progress that under the Requirement of Market Economy, the main impulse part is the MNC and try to rational allocation of global resources. In this way, the developed countries have to be the biggest beneficiaries from the economic globalization. To specific, they make an investment into developing countries to building factories as well as by using cheap local labor and natural resources to get high profits. The other advantages also obviously.
The global economy is dominated by the developed capitalist countries, which means that the rules must also be Westernized. In the domestic market, the economic system is maturely and stable. On the foreign market, they lead to draw up the international trade rules. There are less significant conflict to effect their foreign business. Thus, when these countries and enterprises want to do the economic activities in different markets, they will not face conflict by the different rules. As well as they also can take advantage of effective methods to deal with uncertain risks and reduce transaction costs.


For the developing countries, they access to advanced technology, management knowledge and capital by economic liberalization. However, with the Economic globalization, developing countries have to face the unprecedented opportunities and challenges.
For one hand, the foreign capital investment is undoubted and helpful to resolve the shortage of funds problem in developing countries.
On the other hand, for the domestic market, some labor-intensive industries and capital-intensive industries was transferred to developing countries from the developed countries. This activity is not only offering the jobs chances for local people, but also some high-tech and modern management methods will be accept in undeveloped countries. It is helpful for developing countries to improve technology and equipment to promote the adjustment of industrial structure.

There also exist a lot of challenges for developing countries. Economic globalization is a good chance for developed countries to transferring some significant-pollution industries to developing countries. As a result, though it is good for the economy in the undeveloped area, the nature environment has been suffered a badly damage. The nature resource was extreme waste and the ecological balance also be destructed. What worst, it is unhelpful for the developing countries to make a further development of economy. In this situation, the economy of developing countries will depend on the developed countries deeply.


Another cannot be ignored problem is financial globalization. Under the economic globalization, the financial globalization is promoting economic growth in developing countries, while bringing financial risks and economic shocks. It should be recalled that in due to pressure of the economic globalization and liberalization, Thailand prematurely carry out liberalization of financial markets, and removed all the self-protection barrier, resulting in a serious financial crisis, and then quickly developed into a the Asian financial crisis, has also led to the Russian financial crisis and the Brazilian financial crisis.

The urgent problems current of economic globalization is to establish a fair and reasonable new economic order so as to ensure fair competition and effective. The influences of globalization for a country’s economy are manifold. Globalization has enhanced dependency and competition between economies in the world market. These are reflected in the global commodity trade and capital flows


To sum up, Globalization is a powerful real aspect of the new world system, and it represents one of the most influential forces in determining the future course of the planet. Foreign investment has both positive and negative effects. Secondly foreign investment has led to growing competition on a global basis. Finally, there is no doubt that in the process of economic globalization, the developing countries have contacted the world's advanced technologies and management methods, but this is obtained at the high price of their cheap labor and natural resources. economic globalization to the developing countries is a "double-edged sword." On the one hand, economic globalization offered the opportunities to developing countries to participate in the free flow of global of product factors and optimized economy structure as well as to absorb capital, technology and advanced management experience from developed countries. On the other hand, economic globalization brings challenges on the economic sovereignty, economic risks and different values idea to the developing countries. The economic security of developing countries will be increasingly prominent.

reference：
http://business.mapsofindia.com/globalization/impact.html
http://economics.about.com/od/globalizationtrade/l/aaglobalization.htm
http://www.politicalaffairs.net/article/articleview/3987/
http://www.darkseptemberrain.com/ideas/advantages.htm
http://en.wikipedia.org/wiki/Economic_globalization
http://www.megaessays.com/viewpaper/4430.html