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Globalization

Introduction: The recent wave of internationalization or globalization of business was spurred by a combination of advances in transport and communications technologies. It has been aided by multinational agreements that have reduced or eliminated barriers to international trade including tariffs and quotas. It has been promoted by governments and international agencies such as the World Trade Organization that believe international trade benefits everyone based on the economic theory of comparative advantage.

Proponents of global economic integration argue that globalization promotes peace and economic development in the Third World. They assert that all boats rise with the tide when investors and multinational corporations make higher profits. There are many people who believe that globalization is creating new threats to human security. Opponents of internationalization argue that inequality between Northern and Southern nations is worsening, and that financial instability, economic inequality, competition for resources, and environmental degradation are exacerbated by globalization. While these views are in the minority, there are many people who urge caution in removing barriers to global free trade.

According to James Cooke writing in Logistics Management and Distribution Report, a company usually first tries to gain a foothold in a foreign market by exported into that country. After it has generating sufficient sales revenues through exporting to be convinced that there is strong demand for its products, a company will study the market to determine its growth potential. If the company believes that a foreign operation has a reasonable chance to be profitable, it may invest more money. Cooke writes that companies normally try to generate a critical mass of demand before committing to anything more than exporting to a foreign country such as opening a sales office in that country. Cooke asserts that the real secret of...

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Globalization. (1969, December 31). In LotsofEssays.com. Retrieved 11:59, March 28, 2024, from https://www.lotsofessays.com/viewpaper/1709317.html