Q:

What is the importance of globalization?

A:

Quick Answer

Globalization allows countries to benefit from economic synergy and collaborate in handling political, social and economic challenges. A global economy expands the reach of buyers and sellers for governments and countries. A broader marketplace allows producers to fetch more for their goods, and a global supply network gives public and private entities more buying options.

Continue Reading

Full Answer

Globalization also increases opportunities for companies to expand operations in foreign markets. By accepting foreign investment, a government promotes build-up of its infrastructure. Foreign companies may also hire local employees, which increases domestic employment levels. American companies expand into foreign markets, develop new revenue streams and bring some of that money back into their U.S. operations. This increased capital allows for business expansion and increased levels of hiring.

Government leaders are able to communicate about ways to mutually improve economic conditions and share in the positive economic results. Openness between governments and industry leaders contributes to shared knowledge and resources. Many industries hold international meetings in which companies share insights and trends that benefit all involved.

More domestic competition also forces some companies to grow internationally or risk failure. Developing nations present opportunities to not only develop new revenue streams, but tap into new pipelines for capital.

Learn more about Economics

Related Questions

  • Q:

    Is globalization good or bad?

    A:

    Globalization has both benefits and disadvantages. Some of the benefits of globalization include more efficient markets, wealth equality, beneficial partnerships, increased opportunities and new solutions to problems. The shortcomings of globalization include unhealthy competition and over-exploitation of the environment.

    Full Answer >
    Filed Under:
  • Q:

    What is globalization?

    A:

    Globalization refers to the interaction between different peoples and governments, often in the realm of international trade. It intensifies the interconnections within the global community and influences nations not only economically, but also culturally.

    Full Answer >
    Filed Under:
  • Q:

    What drives globalization?

    A:

    Globalization is driven by international trade and investment and aided by information technology. It is the process of interaction and integration among the people, companies and governments of different nations, states Globalization 101, a website of the Levin Institute.

    Full Answer >
    Filed Under:
  • Q:

    What is economic globalization?

    A:

    Economic globalization is the increasing interdependence of national economies that has resulted from growing levels of trade between nations. This integration of the world's economies is possible as a result of technological advancements that allow for quicker communication around the world, as well as drastically reduced costs of shipping goods. Today, it is possible for companies to manage production of goods efficiently, even when production facilities are on opposite ends of the world.

    Full Answer >
    Filed Under:

Explore