Sometimes, it seems like we spend too much time looking at the disadvantages rather than the advantages of globalization. This is somewhat understandable, since in developed countries such as the United States and the countries of Western Europe, the effect of globalization seems less positive and less beneficial than it might seem to those living in the developing countries.
There are many advantages of globalization, however, and we in the United States have been experiencing them since the end of World War II. Soldiers returning from the battlefields of Europe brought back with them a greater appreciation and understanding of the European cultures, and later on America became more aware of the benefits to be gained from trade with the countries of East Asia.
Not many will argue that the United States should become isolationist again, though some feel that way. A closer look at the advantages of globalization will show us why isolationism and protectionism is not in our best interest in the long run.
Just What Is Globalization?
What are some of the advantages of globalization, bearing in mind that some of the benefits are often more strongly felt in some countries than in others? Let’s start by defining globalization as the act of integrating economies into a global network of competition, communication, and execution.
Globalization has been shown to put competition on a more even basis, largely by breaking down trade barriers and protectionism. There’s still a long way to go in this area, but the more countries buy into globalization, the more difficult it become for countries to set up barriers to free trade.
Reduction In Unemployment
Unemployment has indeed been dramatically reduced on a global scale. Unemployment is a touchy subject, especially in the United States at the present time, where well-paying jobs are viewed as disappearing overseas. The problem is not in the number of jobs, but the skill sets required. Globalization has resulted in jobs requiring higher skill sets. This means many jobs require a higher education, and will provide higher pay as a result.
Spreading Of Wealth
As countries increase trade through globalization, the per capita income of those countries increases. The wealth trickles down to the poor. Even in developed countries, everyone will benefit if trade is managed correctly.
More Options For Consumers
Consumers have a greater choice than ever in the products they purchase. This applies for everything from food, to automobiles, to the latest digital devices. The quality of these products tends to improve as well. As consumers have more to spend, they will tend to purchase products of higher quality. This in turn drives competition, which in turn results in higher quality at lower prices.
More Investment Opportunities
Companies, and individuals for that matter, looking for good places to invest their money have a wider range of choices thanks to globalization. When people are looking for a good rate of return on their investments, they can search the world and not have to worry as much about restrictions or limitations on where or how much they can invest, or worry about the safety of their investments.
Culture And Politics
It isn’t just in the marketplace that the advantages of globalization are felt. Barriers among different cultures are either broken down, or the differences between cultures are at least better understood. Education has become vastly improved on a global basis since one country can learn from another and students can attend foreign schools and universities which offer more expertise in certain fields than in-country institutions might offer.
Most importantly, political ties between nations can be strengthened. Countries tend not to want to go to war with countries they have strong economic ties with. In fact, the stronger the economic and cultural ties, the less there is to want to argue or fight about. Fishing or environmental disputes between the United States and Canada are more often than not settled over a cup of coffee, even when the result is one of agreeing to disagree.
We also see the advantages of globalization in our daily lives. For example, there are more and more restaurants offering authentic foreign dishes. We enjoy quality films from many countries, as well as live entertainment, and can view art exhibitions displaying works of foreign artists.
A very specific example of the advantages of globalization is this:
A number of American companies, including aerospace giants such as Boeing, have traveled to Japan to find out how Toyota runs its factories. Even some government agencies have looked into Toyota’s methods and practices. Ironically, it was an American who introduced the concept of continual improvement, as currently practiced by Toyota and a host of other companies, to Japan. Japan took the American’s idea and ran with it, while America initially chose to ignore it. There are countless such examples of where an idea which takes root in one country or one region gradually spreads to other parts of the globe. Without support for the concept of globalization, the spread of many of these ideas could never happen.