An Analysis of the Positive and Negative Impacts of Globalisation

This essay provides a comprehensive analysis of the impact of globalization on businesses and society, with a specific focus on the United Kingdom. It explores both the positive and negative consequences of globalization, including its effects on trade, technology, cultural integration, and economic reforms. The essay discusses the benefits of globalization, such as increased foreign investment, technological advancements, and enhanced trade opportunities. It also examines the negative impacts, including increased competition, income inequality, and the potential for job losses due to outsourcing. The essay further delves into the role of globalization in the integration of cultures, the impact of technology, and the rise of international markets. The analysis covers the evolution of globalization, its effects on the UK economy, and the challenges faced by small and developing countries in competing with developed markets. Overall, the essay offers a balanced perspective on globalization, highlighting its complex and far-reaching consequences.

THE IMPACT OF
GLOBALISATION

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
GLOBALIZATION.........................................................................................................................1
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Globalisation has played an important role in developing business all around the world. It
has impact on society and people in both positive and negative ways by providing easy access to
every product and services either online or at their door step. This has made life easy though has
increased competition amongst small and medium enterprises which has affected economy
greatly. Globalisation has brought benefits in developed countries as well as negative effects.
The positive effects include a number of factors which are education, trade, technology,
competition, investments and capital flows, employment, culture plus organisation structure. The
negative effects are increased competition, imbalances in economies and wider gap between
classes of people. GLOBALIZATION
The term globalisation refers to making the world one single market where all types of
services and products are easily available. Because of globalisation, the economies of the world
are being increasingly integrated, example: mobile phones and internet have brought people
closer (Cohen, 2018). The world is becoming a smaller place. Work can be outsourced to any
part of the world that has an internet connection because of improvements in traffic infrastructure
one is able to reach one's destination in a short time. Globalisation through global
communications, global markets and global production have promoted and facilitated by a fourth
area of global activity in relation to money (Dermody and et.al., 2018).
Globalisation is opening doors for various small and medium enterprises to export their
finished products and import any sort of raw materials. It is providing individuals a large market
by marking market efficient thereby raising the space of competition. There are many benefits
and associated risks of globalisation which tends to be affecting the society. It increases foreign
exchange between countries and thus raises the general living of people. The overall concept of
globalisation refers to making the world a market place where people all over the globe can buy
and sell products and services thereby enhancing their living (Asongu and De Moor, 2017).
Every single and independent manufacturer can produce identical products and sell to consumers
globally.
The growth rate of globalisation has increased tremendously as world trade ratio is
raising. In addition, the foreign direct investment has increased in both developing and
developed countries (Hopper, Lassou and Soobaroyen, 2017). With globalisation, more
consumption is taking place of goods of similar taste and identity produced by a single

manufacturer all over the world. Newer form of technology and new ways of production has
enhanced growth of particular organisation as well as world economy. New concepts have been
raised which has brought greater benefit to human kind. It has brought in liberalisation of trade
which implies reduction of barriers between countries for purpose of trading. Various trade
barriers and tariffs levied by government have been reduced so as to continue trading between
countries which will bring in foreign investment (Purnell, 2018).
Globalisation has becoming an important source of travelling by enforcing people to
move out and know about the trends going around the world (Hopper, Lassou and Soobaroyen,
2017). People travel from one place and country to different countries. Each part of globalisation
is bringing in new knowledge and technology into the country as well as FDI which has enhance
economic growth of UK (Purnell, 2018). The growing international market though poses threats
for small and developing countries to compete with developed markets. This has not only
increased living standard of people but it has also affected economic system in both positive and
negative ways. It has brought in new economic reforms and regulations which has affected UK
economy by enhancing financial system and reducing risk.
Globalisation has brought in development of technology and science as the world is now
becoming a global village. The use of internet and mobile phones has made communication
between various countries an easy task which tends to provide solutions fast and handy.
Integration of people, their cultures and different religion is all because of increasing
globalisation. It has also affected education system by greatly contributing towards enhancement
of technology (Purnell, 2018).

(Source: Globalisation, 2017)
Though the Brexit has affected the economy of United Kingdom as the manufacturers
have to now buy and sell products and services to other countries leaving the European market
which will bring in more loss as expenses will increase and entrepreneurs need to pay tariffs of
different countries. It refers to anti-globalisation in UK which causes migration by many
entrepreneurs. Globalisation may be inevitable over the long-run, but there are many bumps
along the road in the short-run. These bumps are often spurred by economic crises or some of the
negative consequences of globalisation, but in the end, the world has always managed to learn
that protectionism can make a bad situation worse (Hopper, Lassou and Soobaroyen, 2017).
It all started after the II world war which has opened doors for countries to trade in and
out with each other making the world a global village. European Union and British exit has
Illustration 1: Globalisation

affected this global trend by posing threats in integration of economies. The world economy is
integrated into various components which has reduced cost of transportation and technology. It
has created ample opportunities for business firms all over the world which has ease use of
communication between two countries and thus helped in developing of economy by increasing
scale of operations (Purnell, 2018).
(Source: Globalization, 2010)
Positive impact of Globalisation:
Globalisation has affected the society positively and has impacted the economy by
bringing in many cultures together so as to work in order to produce in harmony by sustainable
use of resources available all over globe (Reader, 2017). It has increased number of business
transactions across countries. It has impacted level of education, quality of food products, trade
incentives, newer and advanced technology, healthy competition, lower cost of operations and
legal measures which protects all. The various positive impacts of globalisation are:
Integration of Cultures:
There are various cultures preventing all over the globe and with globalisation they are
coming together to work in harmony (Cohen, 2018). Many people all over the world having
spending power buy products and services which provide a symbol of status as well as raises
standard of living. The international market is growing at a high speed and thus brings in western
Illustration 2: Globalization

culture of dressing, food habits and other technology as well as new form of education which has
raised people’s choices and their way of looking at things.
The impact of globalization on culture is inevitable as educated and wealthy group of
people are interacting to each other.
Technology:
The globalization of countries has brought in new technology which has simplified work
and process of organizations (Hopper, Lassou and Soobaroyen, 2017). It has strengthened
relationship among countries as communication is fast and quick. Newer ways of production
using advance technology has reduced cost and labour force.
Now firms are engaging in grabbing advance technology from other countries and
transmitting it to parent company located in another country. Globalization thus has advanced
performance of countries by using technology available in different countries.
Increased Trade:
Globalization has brought advancement in trade by increased production of specialized
goods and has raised the economic condition of UK (Dermody and et.al., 2018). Trade between
countries is more accessible with globalization. Increase technology has also played an important
role in rising trade between borders.
Big multinational companies have raised foreign trade by importing and exporting goods
and services across countries. Many organizations have established to control trade activities of
countries such as World Trade Organization which regulate commercial activities of countries by
maintaining fair trade policies (Cohen, 2018). This has raised infusion of foreign capital in
economy of UK and advancement of technical labour has also increased.
Enhanced imports:
Globalization is growing faster and with it interrelationship between individuals is
growing at fast pace. It has increased imports of products at an yearly basis especially seasonal
fruits and vegetables available in UK. It has reduced barriers and enhanced free flow of goods
and services between countries which has contributed to development of economies especially
developing market.
It is viewed as with the effect of globalization, trade amongst countries has increased
which has raised employment opportunities and income of employment thereby stabilizing

economic structure of UK (Purnell, 2018). Globalization is also known as an economic process
which has greatly reduced tariff and trade restriction between countries.
Rising competition:
Another positive impact of globalization is quality goods and services availability all over
the world due to rising competition among producers of identical goods. It has improved
customer satisfaction by producing exclusive products and providing extensive customer
services.
Every organization either domestic concerns or international business units in order to be
a part of competition has increased its scale of operations and quality standards so as to satisfy
customers proportionately (Dreher, Sturm and Ursprung, 2008). The level of competition has
increased financial status and thus has brought foreign investment into countries thereby rising
competition for domestic business units to produce more quality products to compete with
foreign firms.
Low costs:
With increase in globalization companies are engaged in outsourcing of various services
and intermediary products and procurement of unskilled labour from different parts of the world.
This has reduced cost of firms as cheap products, inexpensive workforce and highly technical
programs are available globally (Wilpert, 2009). The firms by saving cost can expand their
business either domestically or globally thereby contributing actively to healthy competition.

(Source: Effects of Globalisation on the UK Economy, 2016 )
Negative effect of Globalisation:
The globalization has affected UK economy and its people negatively thereby cutting
down employment and rising prices of daily routine products. With outsourcing of various
functions and manufacturing jobs people are migrating thus leaving their regions and culture in
search of living (Spence, 2011).
Globalization has affected developing, transitional and developed countries and their
economic system in a pessimistic manner. It has impacted traditional ways of working and
behaving of people with cross cultural interaction.
Unemployment of unskilled labour:
Globalization has a brought a feeling of disrespect amongst the workforce as
organizations are keen towards making profit by employing unskilled and cheap workforce from
across the globe (Glatzer, 2012). The entrepreneurs are focusing on increasing productivity and
expanding business thereby cutting cost of recruiting and selecting skilled workforce.
Illustration 3: Impact of Globalization

This trend has led to unemployment of various job seekers who are fighting to earn living
while searching jobs (Young and et.al., 2009). The unemployment has thus affected economic
conditions and even worsened the situation as poverty grew on an alarming rate. The growing
international market though poses threats for small and developing countries to compete with
developed markets.
Growing inequality:
With increasing globalization growth of inequality has widened. The world now
experience two sets of people one which is having tremendous wealth and another section of
society who is trembling to earn a living each day (Effects of Globalisation on the UK Economy,
2016). The distribution of income is accumulated in few hands as they are growing with
competition thereby implying price hike of products and unemployment conditions which has
seen a growth in poverty.
Globalization is the major reason behind increasing inequality and exploitation of labour
sector in order to produce cheap products using inexpensive materials (Ibrahim, 2013).
Tax avoidance:
Many big multinational firms working globally has shifted their manufacturing units in
countries where tax is cheap and availability of labour is huge and inexpensive as well. This has
affected countries as it is a main source of income of government to enhance economic
conditions of their countries.
Globalization has impacted UK as many firms set their base in other countries so as to
save a huge cost in form of tax to government. This has another impact thereby unequal
distribution of income in few hands (Fleer, Hedegaard and Tudge, 2012).
Fluctuation in prices:
The economic process among countries has led to change in prices of goods and services
as trade across borders has brought competition. Many developed countries have to lower down
prices of products as other countries goods are cheaper then the domestic products available in
UK (Asongu and De Moor, 2017).
CONCLUSION
The report concludes that globalization has both positive and negative outcome which
affects countries economic conditions as well as individuals. Globalization started after II world
war and has now become a part and parcel of daily life which cannot be neglected. It has bridges

gap between countries and made trade an easy task thereby enhancing operations of scale and
profitability margins. Globalization has enhanced economic process of countries by making
things available all over the world.

REFERENCES
Books and Journals:
Asongu, S. A. and De Moor, L., 2017. Financial globalisation dynamic thresholds for financial
development: evidence from Africa. The European Journal of Development Research.
29(1). pp.192-212.
Cohen, R., 2018. Diasporas, the nation-state, and globalisation. In Global history and migrations
(pp. 117-143). Routledge.
Dermody, B. J. and et.al., 2018. A framework for modelling the complexities of food and water
security under globalisation. Earth System Dynamics. 9(1). p.103.
Dreher, A., Sturm, J. E. and Ursprung, H. W., 2008. The impact of globalization on the
composition of government expenditures: Evidence from panel data. Public Choice. 134(3-
4). pp.263-292.
Fleer, M., Hedegaard, M. and Tudge, J., 2012. World yearbook of education 2009: Childhood
studies and the impact of globalization: Policies and practices at global and local levels.
Routledge.
Glatzer, W., 2012. Cross-national comparisons of quality of life in developed nations, including
the impact of globalization. In Handbook of social indicators and quality of life research.
pp. 381-398.
Hopper, T., Lassou, P. and Soobaroyen, T., 2017. Globalisation, accounting and developing
countries. Critical Perspectives on Accounting. 43. pp.125-148.
Ibrahim, A.A., 2013. The impact of globalization on Africa. International Journal of Humanities
and Social Science. 3(15). pp.85-93.
Purnell, M., 2018. Globalisation and its impact on the journal collections of research libraries in
Australia: a Health Library’s perspective. Journal of the Australian Library and
Information Association. 67(1). pp.55-63.
Reader, J., 2017. Reconstructing practical theology: The impact of globalization. Routledge.
Spence, M., 2011. The impact of globalization on income and employment: The downside of
integrating markets. Foreign Affairs. pp.28-41.
Wilpert, B., 2009. Impact of globalization on human work. Safety Science. 47(6). pp.727-732.
Young, F. and et.al., 2009. A review of co-morbidity between infectious and chronic disease in
Sub Saharan Africa: TB and diabetes mellitus, HIV and metabolic syndrome, and the
impact of globalization. Globalization and health. 5(1). p.9.
Online:

Effects of Globalisation on the UK Economy. 2016. [Online]. Available through:
<https://www.economicshelp.org/trade2/globalisation_uk_economy/>.
Globalization. 2010. [Online]. Available through: <http://globalisationteacherblog.blogspot.in/>.
Globalization. 2017. [Online]. Available through:
<https://brazilgeo.wordpress.com/tag/globalization/>.