Globalization: Evaluating Evidence, Factors, and Issues

This essay offers a critical analysis of globalization, defining it as the cross-national flow of products, services, and technology, operating without geographical boundaries. It evaluates the evidence for and against globalization, examining factors such as market, economic, political, and technological influences. The essay discusses arguments supporting globalization, including increased economic growth and improved living standards, while also addressing criticisms such as environmental impacts, income inequality, and social tensions. It highlights key drivers like lower trade barriers, technological advancements, and trade agreements, which have facilitated global business operations and created a single market. The analysis includes a discussion of the McKinsey Global Institute's perspective on the future of Asia and its role in globalization, as well as the issues and challenges associated with rapid global integration. The essay concludes by acknowledging the benefits of globalization while also recognizing its potential negative consequences, such as financial instability and income disparities, as discussed in the provided references.

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CRITICAL ANALYSIS OF GLOBALIZATION
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Introduction
Globalization is considered to be cross national flow of products, services and
technology. In other words, it is the complex economic, social, and political and culture
aspects which operates freely without the influence of any geographical boundaries or
national distance. It has been argued that development in the world has various positive and
negative consequences. Globalization integrates the national economies of various countries
into international economy through trade, capital flows, advancement of technology and FDI
(Foreign direct investment). The purpose of this essay is to evaluate the evidence of
Globalization and the factors driving globalization. It analyzes the issues of globalization in
terms of market factors, technology, political factors and technology.
Discussion
Arguments in favours and against globalization
It has been argued by Beck (2018), that globalization has entered into a new phase
through the flow of information and data. The digital flows and advancements have larger
impact on the growth of GDP in the countries than the older ways of trading, according to
new McKinsey Global Institute (MGI) report. The new phase or the shift of globalization has
provided additional opportunities to the companies to enter international markets and make
profits out the new risks and challenges. Globalization connects the world together with the
flow of information, effective communication, transactions and intra-company traffic. In

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additional to data and information exchange, every cross border exchange has digital
component.
According to Croucher (2018), different individual companies and organizations are
able to show case their talents and abilities and have international connections through social
media and taken part in cross border e-commerce industries. The digital eras of globalization
are able to manage their operations globally through efficient ways with the implementation
of digital platforms and tools. This widens participation and creates new efficient markets
supported with increased productivity and flow of data and information. It has increased the
standard of living among the countries and boosts economic growth. However, it has been
heavily criticized due to its negative effects. According to Lechner and Boli
(2020), Globalization has significant impacts pm environment, political aspects of the
country and the social wellbeing of a particular country. There has been increase in income
inequality, increase in social tensions and lack of class mobility.
Factors driving globalization
According to Lund and Tyson (2018), the current pace of globalization is driven by
number of factors such as economic, financial, political and social and technological factors.
The lower trade barriers among the countries are important factors towards globalization. The
political situations among the countries are also designed in a way which facilitates trade and
commerce. It is believed by Rodrik (2018), that technology plays a key role in facilitating
globalization. It has enables the business organization to globalize their product and services
throughout the globe. The social factors bring cultural convergence by reducing
transportation and communication costs. The cost of communicating has reduced with the
advancement of technology. Most importantly the trade agreements among the countries have
enables the business organization to carry out their business operations in the international

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market smoothly and with minimum efforts. This has shrunk the world to a single market.
These factors are some of the important drivers of globalization. These factors have shaped
globalization and flattened the world.
As per McKinsey research on ‘The Future of Asia’, the next phase of globalization is
defined by the flows and networks of Asia. The ‘micro to macro’ methodology of MGI
examines the trends of the industries to better understand the forces from micro and macro
environment affect the business operations. For example, Asia is becoming the centre of the
world, the purchasing power parity of Asia increased from 32% to 43%. It is expected to
increase further by the year 2040 (Tonby et al. 2019). However, it faces challenges and issues
such as risks in financial systems, excessive pressure on the environment and increase in
inequality of income. With the increase in globalization, Asia is getting ‘bigger and more
integrated’ (Tonby et al. 2019). Asia has excelled in innovation, market, labour, capital and
cultural diversity. With the rise in supply chains and maturing domestic value chains, Asia’s
industrialization has paced up. Furthermore, the technological advancement and innovation
enables the market to growth (Tonby et al. 2019). There has been a growing hub for cultural
force and people flows. The hub for people flows in Asia is gaining much importance.
Issues of globalization
As mentioned earlier, the rapid increase in globalization due to progress and
advancement of technology. However, critics are of the opinion that increased globalization
has negative impact on the countries. As argued by Beck (2018), with the increase in
globalization, the worked consumption has increased. For instance, there has been increase in
the world carbon dioxide emissions, excessive usage of coals and other gases. Moreover,
there has been increase in social tensions among the countries. The critics argue that only the

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elite section and educated section of the consumers benefits from globalization (Lund and
Tyson 2018). Therefore, it increases inequalities and results in gross imbalance.
There has been a great financial retrenchment in some of the countries which affects
the financial wellbeing of the countries as mentioned by Hudson (2009). Experts are of the
opinion that protectionism is one of the biggest dangers that the world can be facing. Further,
there has been an increase in credit risks. There is evidence that the western governments are
keeping the foreign banks out from the market. There has been a whiff of protectionism
regarding it. The financial nationalism is driven by market as well as by the politicians.
Hence globalization can be under strain as indicated by Hudson (2009).
Conclusion
Therefore, from the above analysis, it has been identified that Globalization benefits
the world in various ways such as enhanced economy, increased standard of living among the
people and unifying the world market. The report has discussed the arguments in favour and
against globalization. It has been identified that globalization might have negative
consequences in the economy such as gross imbalance. It has been criticized due to its
inequalities and financial retrenchment as discussed in the report.

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References
Beck, U., 2018. What is globalization?. John Wiley & Sons.
Croucher, S., 2018. Globalization and belonging: The politics of identity in a changing
world. Rowman & Littlefield.
Hudson, F., 2009. Globalisation under strain. The Economist. Homeward Bound. [online]
Available at: <https://www.economist.com/briefing/2009/02/05/homeward-bound>
[Accessed 11 April 2020].
Lechner, F.J. and Boli, J. eds., 2020. The globalization reader. John Wiley & Sons.
Lund, S. and Tyson, L., 2018. Globalization is not in retreat: Digital technology and the
future of trade. Foreign Aff., 97, p.130.
Rodrik, D., 2018. Populism and the Economics of Globalization. Journal of international
business policy, 1(1-2), pp.12-33.
Steger, M.B., 2017. Globalization: A very short introduction (Vol. 86). Oxford University
Press.
Tonby, O., Woetzel, J., Choi, W., Eloot, K., Dhawan, R., Seong, J., Wang, P., 2019.
McKinsey Global Institude: The future of Asia: Asian flows and networks are defining the
next phase of globalization.