Globalisation was initiated in the early centuries as a way of integrating the world of economists, business and political activities which were focussed on cost associated protection. This resulted from the idea of declining international economic integration. This gave birth to several international institutions that were supposed to oversee international trade by removing the barriers to trade. It is thus a process that aimed to be beneficial to all people within a country and in the whole world. However, globalisation is nowadays involving many others activities which are multivariate in approach.
It involves economics, social and political dimensions. Globalisation is therefore having various aspects which are affecting the world in different ways. Such aspects include looking for the markets for the products and access to a range of foreign products which are required for their productions. Since the inauguration of globalisation, the industrialist system has recorded an unbelievable number of achievements. The industrial revolution has fetched a new standard of prosperity, shape and comfort to the people of the world over.
According to many economists, these accomplishments have been achievable due to a novel institutional framework that supports competitive markets, political freedoms and universal education encouraging objective scientific interactions and allowing social and political criticism, and provides safety to reduce risk and deprivation. Globalisation has led to reducing scarcity and has created a catastrophe of sustainability as susceptibility to the poor to consume exceeds of his capacity and to conserve diversity and control wastes is no longer there.
Removing national barriers has exposed rich and ill-equipped peoples to the threats as well as the benefits of free trade and competitive markets. Globalization has affected the poor in communications by reducing cultural diversity and exposed everyone to the temptations of an often selfish and slight international industry. In addition, the demands of competition in the capitalist setting and transformation of workers has implications for stress-related illnesses, family breakdown, and the loss of long-established values of family team spirit which adds cost to the poor.
(Pistor, 1997) The internationalization of the market has a direct impact in most important sectors which are mostly dominated by the poor. Mostly, the poor are kept in those sectors which are widely associated with the production but not in the distribution. The poor producers do not benefit from globalisation as the middle class men always makes the best of the un informed poor men in the globalise world. Thus the globalise trade in agricultural and livestock commodities from the poor are lowly paid for. This makes such sectors to be lagging behind in terms of industrialization.
By commercializing their natural products, either raw or semi processed, they can achieve a balance of trade superfluous. However, it is in the agricultural markets that rich countries have been stubborn in putting favourable policies for the free trading conditions. (Pistor, 1997) While it is correct that globalization supports free trade among countries on an international level, there are also negative results because some countries try to save their national markets. The main export of poorer countries is usually agricultural goods. It is difficult for these countries to compete with stronger countries that subsidize their own farmers.
Because the farmers in the poorer countries cannot compete, they are forced to sell their crops at much lower price than what the market is paying. Thus, mistreatment of foreign impoverished workers results. The worsening of protections for weaker nations by stronger industrialized powers has resulted in the exploitation of the people in those nations to become cheap labour. Due to the lack of safety, companies from powerful developed nations are able to offer workers enough salary to entice them to endure tremendously long hours and unsafe working conditions.
The abundance of cheap labour is giving the countries in power motivation not to rectify the inequality between nations. If these nations developed into industrialized nations, the army of cheap labour would slowly disappear alongside development. With the world in this current state, it is impossible for the exploited workers to escape poverty. It is true that the workers are free to leave their jobs, but in many poorer countries, this would mean starvation for the worker, and possible even family members. (Sachs, 2005)
Globalisation has led to the shift from manufacturing to service work. The low cost of offshore workers have attracted corporations to move production to foreign countries. The laid off unskilled workers are forced into the service sector where wages and benefits are low, but turnovers are high. This has contributed to the widening economic gap between skilled and unskilled workers. The loss of these jobs has also contributed greatly to the slow decline of the middle class which is a major factor in the increasing economic inequality in the whole world.
Families that were once part of the middle class are forced into lower positions by massive layoffs and outsourcing to another country as technologies are bringing about globalisation are changing day by day. This also means that people in the lower class have a much harder time in climbing out of poverty because of the absence of the middle class as a stepping stone. (Sachs, 2005) Globalization is leading to the rise of contingent work. As globalization causes more and more jobs to be distributed overseas, and the middle class people’s declines, there is less need for corporations to hire full time employees.
Corporations are less inclined to offer benefits such health insurance, bonuses, vacation time, shares in the company, and pensions, or reduce benefits, to part time workers. Most companies don’t offer any benefits at all. Even though most of the middle class workers still have their jobs, the reality is that their buying power has decreased due to decreased benefits. Job security is also a major issue with contingent work. Moreover, globalisation is weakening of labour union. The excess in cheap labour coupled with an ever growing number of companies in transition has caused a weakening of labour unions in the in the world.
Unions lose their effectiveness when their membership begins to decline. As a result unions hold less power over corporations that are able to easily replace workers, often for lower wages, and have the option to not offer unionized jobs anymore. (Humphreys, 2000) On the hand, globalisation has in many ways helped the poor countries to come out of the dungeon of poverty. Through globalisation, poorer countries are given opportunities that allow them to trade freely without facing much challenging rules and regulations in trade transactions. Trade allows individuals to exchange goods and services.
Hence, globalisation is helping in people who are poor to access these goods and services in their local markets at reduced prices. The reduction of costs on goods and services as results of globalisation enables the poor to have savings which perhaps would not have possible before. From the research sources, it is indicated that trade for many developing countries increased with the introduction of globalisation. The increase in trade was a bit varied from one country to another. This meant that the benefits of globalisation can be received unequally depending on a country trading power to another.
(Sachs, 2005) The globalisation aspects have enabled capital movement hence financial assets have been moved across international borders. The poor benefit from such investments in many different ways. When there is capital investment in the poor areas, trade is opened up which allows people to be employed in such investment enterprises. This creates job opportunities in places which were once inflicted by few job opportunities. The earnings received by the employees are used to raise their living standards hence closing the gap between the poor and the rich.
Through capital movement by globalisation aspects, business are opened which brings in foreign exchanges through taxation of some of goods which are entering the country. This helps the country to be self sufficient by replacing foreign aid. It gives transitions that lead to market economies. Multinational corporations which invest in any poor countries, they are found to be more of benefit than the local investors in such states. By comparison, the companies have been building factories and hiring workers from local communities.
The employees hired have been found to be living in a more comfortable life as compared to their fellow counterparts in others local companies. This is because they are being well paid by the multinational companies as compared to the home country companies which lack adequate capitals and have low turn over. (Warwick, 2001) Due to globalisation, workers move to where jobs are located. Unskilled poor workers are then given the chances of moving to where unskilled labour is required and vice versa. That is the skilled workers also move to where more skilled labour is required.
It has been proved beyond no reasonable doubt that wages communicates the demands for the labour required in a given country. Hence people move from places of low wages to places with higher remunerations. Previous results have shown numerous numbers of people are moving from either developing to developed countries or from under developed states to developing ones. This verifies that globalisation in not benefiting the rich and harming the poor. In fact, the participation in globalisation is making the poor to earn higher wages than those who are poor and do not take part in globalisation.
Globalisation brings about competitions which the poor benefits very much than the rich. The rich being the investors are forced to improve in the quality of goods and services which the poor would always enjoy. Companies in competing environments provides better opportunities for qualified persons who in turn produces better services and quality goods in return for higher salaries. In addition, countries that are poor get the benefits of having their poor workers to travel abroad where they earn higher wages and then send the money back to the home countries.
This money is pumped into the economy of the poor nation where many more people can get the daily breads and raise their living standards. (Sachs, 2002) Globalisation is spreading with technology. The poor is being given challenges to explore in the new technologies which are of vital importance in business investments. The installation of new equipment and technologies in poor countries are key factors to alleviation of poverty but not a way of impoverishing the poor to his dismal points.
Such technologies with globalisation help the poor enhance his production methodologies, management techniques and all general mitigations of work. As I conclude, when the rich get richer and the poor becomes poor, it is not a result of globalisation but the fact is that the poor is in fear of embracing the new methods of globalisation for alleviation of poverty conditions. The perception of globalisation a way of exploiting technique of the poor has left many countries and people in poorer levels than they should be. (Humphreys, 2000)
This is because the globalisation is helping people to realise the free movement of goods and services are comparatively much beneficial in terms of uplifting the living standards of the people rather than focusing on minute disadvantages of the trade. Wealthy countries are much concerned with the helping the poor through job provisions as well as aid disbursement to the poor one. The provision of the poor with aids has major impacts on their health of the poor as healthy people are able to perform better than unhealthy persons.
Due to globalisation, the people leaving as poor people in the world have decreased considerable. People who are leaving earning less than two dollars are those who have despised the practices of globalisations as they are being faced with many problems. The percentages of the people in global countries are much lower than those in ant –globalisation sects. So globalisation has benefited both the rich and the poor. The rich has been in able to get market for his products and services. He has also been a position to get opportunities to invest for the future to enhance world production which benefits the whole world.
The poor have more advantages in that the rich provides means to the poor through whom he can lift up his leaving standards and escape the poverty situation by learning the new technologies and exploiting them. (Sachs, 2005)
Reference: Humphreys, M. (2000): Escaping the Resource Curse. Columbia University Press Sachs, J. (2005): The End of Poverty: Economic Possibilities for Our Time: Penguin Press Sachs, J. (2002): Resolving the Debt Crisis of Low-Income Countries Warwick, M. (2001): the Strategic Significance of Global Inequality: University of Chicago Press Pistor, K. (1997): The Rule of Law and Economic Reform in Russia. West view Press
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