Globalization

The process of globalization is a phenomenon in human history which has been bringing the world closer since the time of early trade and exploration, through the exchange of goods, products, information, jobs, knowledge and culture.

The term first surfaced during the 1980s to characterise huge changes that were taking place in the international economy, notably the growth in international trade and in flows of capital around the world. Globalization has also been used to describe growing income inequality between the world’s rich and poor; the growing power of multinational companies relative to national government; and the spread of capitalism into former communist countries. Usually, the term is synonymous with international integration, the spread of free markets and policies of liberalisation and free trade. The process is not the result simply of economic forces. The decisions of policymakers have also played an important part, although not all governments have embraced the change warmly.

The driving force of globalization has been multinational companies, which since the 1970s have constantly, and often successfully, lobbied governments to make it easier for them to put their skills and capital to work in previously protected national markets. Firms enjoying some national protection, and their (often unionised) workers, have been some of the main opponents of globalization, along with advocates of fair trade.

Despite all the talk of globalization during the 1990s, in some respects the world economy was more integrated in the late 19th century. The labour market was certainly more global. For example, the flow of people out of Europe, 300,000 people a year in the mid-19th century, reached 1m a year after 1900. Now governments are much fussier about immigration, and people are no longer free to migrate as they wish. As for capital markets, only in the 1990s did international capital flows, relative to the size of the world economy, recover to the levels of the few decades before the first world war.

What is unique is the emergence of a modern form of globalization in recent decades, aided by the pace and scope of global integration resulting from unmatched advancements and reduction in the cost of technology, communications, science, transport and industry.

Markets have become more interwoven and the production process has been made more efficient by the option to create “world products”, i.e. products whose components are made in different locations around the world. Also, the ability to ship information and products easily and cheaply from one country to the next and to locate the manufacturing process where labour and work processes are less expensive has changed the pattern of production and consumption across the world.

Improved technology in transportation and telecommunications – the cost of how people communicate and travel has drastically reduced in the last few decades, from cheaper air travel and high-speed rail to the rapid growth of the internet and mobile phones.

Movement of people and capital– increasing numbers of people are now able to move in search of a new home, job, or to escape danger in their own country. Money is being moved globally through electronic transfer systems. Developing countries are becoming a more common place for international investment due to the huge potential for growth.

The lowering of trade barriers since the Second World War has been a major factor in the growth of world trade. The World Trade Organisation (WTO), formerly the General Agreement on Tariffs and Trade, has been responsible for negotiating reductions in tariffs and other barriers to trade in rounds of talks, the most recent of which was the Doha round.

Rise of Non-Governmental Organisations (NGOs) – as global awareness of certain issues has risen, so has the number of organisations that aim to deal with them. Many of these issues are not constrained by country boundaries, e.g. climate change.

Transnational Corporations (corporations that are registered and operate in more than one country at a time, TNCs) access new markets across the world by opening up in developing countries. Businesses are also encouraged to source workers globally, as some jobs can be done by foreign workers for a much lower cost than domestic workers, such as manufacturing jobs.

Benefits and disadvantages

While globalization is a catalyst for human progress, it can also be a chaotic process which offers both benefits and disadvantages to people across the world. Within Britain the benefits are often seen as unevenly distributed.

Those that have been successful in opening up to the world economy, include countries such as China, India and Vietnam, who have significantly reduced poverty in their respective countries.

For consumers, globalization can mean a wider choice of goods at lower prices, for example, supermarkets now source produce from all over the world. Clothes shops are able to source cheaper clothing from overseas factories. The last decade has also seen an increase in the outsourcing of innovation, where research and development (R&D) is increasingly outsourced to cut costs and get products to new markets faster.

Perceived positive consequences of globalization include:

• improvements in local productivity can promote prosperity;

• the movement and sharing of information, knowledge and expertise;

• the improvement of international standards for variables such as education and health;

• increases the variety of goods available to the world market and provides a bigger range of markets for internationally sourced products.

Perceived negative consequences of globalization include:

• the loss of employment in manufacturing in developed countries such as Britain;

• a drift towards a more homogenised culture and society internationally;
• local economies may be more vulnerable to fast changes in the international economy;

• increased centralisation of power in the hands of large transnational corporations;
• the location of industry in less developed countries, for many reasons, often leads to environmental degradation.

Globalization is often criticised on the basis that is has led to the exploitation of workers and the environment. With an increasing awareness of the environmental impact of what we buy. Consumers are increasingly aware of the distance produce has travelled before being sold to us (known as “food miles”). Similarly health and safety laws and regulations are often less demanding in developing countries.

http://www.economist.com

http://www.21stcenturychallenges.org

Exercise 7. Look into the definitions of words job, work, and labour. Then complete the sentences with the right word.

job	1) the regular paid work that you do for an employer; 2) a particular thing you have to do, considered as work [= task]; 3) something that you are responsible for doing.
work	1) a job or activity that you do regularly, especially in order to earn money; 2) a place where you do your job, which is not your home; 3) the duties and activities that are part of your job.
labour	work, especially physical work.

1. Cleaning the car’s one of my least favourite __ jobs _________.

2. She’s still at _____________. I’ll ask her to call you when she gets home.

3. Large-scale growth in this type of farming is limited by the climate and the high cost of _____________.

4. If she can afford it, she cuts back to part-time _____________ or stops entirely.

5. A large part of the _____________ we do involves using computers.

6. Four months after his dismissal, he applied for a _____________ with the Metropolitan Insurance Company.

7. It’s my _____________ to make sure that the work is finished on time.

Exercise 8. Find these patterns “adjective/ noun/ verb + preposition” in the text “Globalization”. Fill in the gaps with the correct prepositions and give Russian equivalents of the patterns. Then complete the sentences with the right patterns.

available	__ to __	_ доступный, имеющийся в наличии _
responsible	______	______________________________
aware (-ness)	______	______________________________
to result	______	______________________________
reduction	______	______________________________
relative	______	______________________________
fussy	______	______________________________
in search	______	______________________________
increase (n)	______	______________________________
due	______	______________________________
drift (n)	______	______________________________
vulnerable	______	______________________________

1. The economy is ______________ ______ a rise in the euro exchange rate or in interest rates.

2. This has ______________ ______ a loss of focus and a ______________ ______ multiple and contradictory objectives.

3. The engineers who are ______________ ______ control systems care about around-the-clock reliability.

4. ______________ ______ answers, they bolted and ran to alternative practitioners.

5. Most people are ______________ ______the dangers of drinking and driving.

6. My sister was always ______________ ______ her looks.

7. Not enough data is ______________ ______ scientists.

8. Consumers will benefit from the ______________ ______ gasoline prices.

9. The value of the dollar ______________ ______ the yen has dropped slightly.

10. There has been a marked ______________ ______ the use of firearms.

11. The delay was ______________ ______ a lack of scaffolding.