Economics Globalization

 




Economics Globalization

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The global economy of the 21 st century has actually transformed both the educational, social, political and economic landscape in a more indelible and profound manner. It is in turn composed of such trio logy of more interactive forces as trade liberalization, globalization, and communication revolution and information technology. Globalization has hence melted trade barriers, national borders while free trade enhances economic integration (Black, 1998). The communication and information revolution has nonetheless made time and geography irrelevant. The functions and roles of entrepreneurship in this modern global economy have taken more significance while facing a myriad of challenges. We live in such global village where the environment is rapidly changing with economic events while the private sector shrunk both in its influence and importance. Entrepreneurs have thus defining such new rules of engagements they tackle the contemporary challenges as well as the new avenues of opportunities.
The economic development and economy in this modern economy have actually been preceded by such complex and of a structural realignment of these investment streams. This has also been affected by clustering of global business enterprises, adoption of the new marketing approach as well as the transformation of the mechanized production process. Its thus important to integrate the state of the art kind of technologies within the domain of communications and information in order to always enhance a more competitive advantage within the forum of global trade (Kosakowski, 1998). The role of technology and innovation as a catalyst which drives this economic need to be always acknowledged as a key postulate of this modern global economy. Moreover, the pivotal role of any nation's unique economic value and human resources endowment reflected in the technical and educational attainment of its people is a fundamental prerequisite for powering this new global economy as well as the integration of labor industries. 
 The knowledge-driven economy is powered by information technology, research and development and human capital which accelerate the economic integration and levels of productivity. The fuel of this new economy is based on human capital, capital flows as well as financial markets within borders. These global opportunities need a more competitive tax level, emphasis on human capital transfer, industrial clusters of excellence, the emphasis is on universal education and training geared towards international market niche (Choudhry, 2002). The revolution of the information technology in this new era has led to a contraction of space and time redefining new parameters as well as advancing frontiers of the economic connectivity. The public service, education, baking, electronic commerce and health care are in the forefront of these globalization with information revolution (Archibugi, 2008). This rapid change, as well as structural transformation, are such hallmarks of the global economic and structural transformation.
Globalization has evolved and also mutated over the past centuries to reflect such ambitions and priorities of different generations. The international outreach for economic, military, trade and geopolitical benefits has actually transgressed over the centuries. Those parties advocating for such policy have in turn argued that this new globalization helps reduce both challenges of developing countries and giving them competitive edges towards achieving economic growth. This is always achieved through minimizing such inefficiencies within production systems, free flow of labor and capital, liberalization and transfer of technology (Lewis, 2007). Nonetheless, globalization has brought some new challenges as it has killed local industries since they cannot withstand stiff competition from such leading multinational companies. In developing nations, globalization has affected their agricultural sector since their markets are flooded with goods from developed countries
The global integration of world economies through investment, trade flows and production of services and goods has enhanced international competitiveness. The process has increased integration of markets which has resulted in such integrated form of the global market with no borders (World Economic Forum, 2014. ). This has been necessitated by the development of global networks and corporations through increased internationalization of production, consumption, marketing, standards, capital, and sales. It's also enhanced by a rapid growth in both intra-networks and intra firm trade of sub-assemblies, finished products and components leading to such a higher state of specialization. Globalization is also marked by wide diffusion and development of such lean methods of production, the disintegration of the production, migration of standard technology and labor-intensive production to low wage economies (Archibugi and Michie, 2009). It has been also fueled by migration of skilled and highly educated workforce to such countries with advanced kind of technology as well as the integration of multicultural and multinational labor in order to thrive.
Globalization has nonetheless been powered by financial liberalization, technological change and sustained by such policies off a liberal, open and ruled based form of financial or international trading system. The economy has become global both in substance and scope. The free flow of labor, services, goods, and capital within the economical belt of free trade, development of new institutions and financial instruments as well as access to the information technology through the digital networks has created a kind of integrated worldwide economic system (Black, 1998).
Trade liberalization
The progression of this globalization has been evident in economic and geopolitical ambitions of the military, political and economic superpowers by war, colonization, economic and political supremacy as well as through multilateral agreement and international economics liaisons. Through the exploitation and discovery of new lands, military annexation and conquest of territories and signing of multi-trade free trade concessions and agreement, the process of this globalization has always been such uninterrupted continuum in humankind history. 
The rapid interconnected global economy needs such active promotion of the global cooperation, as well as free and fair opportunities for the developing and developed countries. The reform of such international system is required to maintain the momentum for the structural reforms in economies and encourage economic growth through poverty eradication. Most of the industrial nations are shifting their production base to countries with cheap and available labor, low production cost and technological savvy industry such as in China. This, in turn, gives such advantage of favorable trade balance and control over the global market and financial resources. Several companies have become established through these labor and capital flows leading to sizable distribution and production activities all over. 

Internationalization of the firm's production has, in turn, led to a growing vertical form of specialization in the world trade. This has increased the use of both imported components and inputs in the production of goods from different developing countries. Trade liberalization has been pursued aggressively in recent past bot at bilateral and multilateral level although the process has been cumbersome in reaching agreements through GATT and WTO (Gera, 2008). A regional form of economic agreements has contributed to trade, economic efficiency, investment and economic growth. They have also become substantial contributors towards structural reforms by streamlining the customs regulations and procedures, creating incentives towards the elimination of such restrictive trade practices as well as integrating financial markets. Regional trading unions have also promoted simplification of various money transfers and procedures policies which are related to infrastructure, transportation, immigration and labor (Mohr, 2010). This has allowed harmonization of incentives, technical and standard regulations as well as tax treatment.
The capital account liberalization, integration of digital technologies and development of financial instruments has created such integrated capital market with tremendous substance and scope. Nonetheless, financial and technological innovation has actually triggered such demand for increased international investment, payment systems and trade. It has also necessitated an emphasis on growth of sound financial systems, implementation of sound monetary and fiscal macroeconomic policies as well as compliance with principles of the good governance (Ostry, 2011). Increased capital flows have led to greater reliance mainly on inter-market to coordinate the demand and supply of foreign exchange. The growing trend of adopting flexible exchange rate has been responsible for such movements towards a kind of currency convertibility. With the elimination of exchange restrictions for liberalized capital movements and international transactions, conditions for a conducive foreign exchange are created.
Information Technology
The information and communication technology has created a revolution which profoundly altered the modus operandi and structural parameters of national economies. This transformation has led to a restructuring of various work environments, reconfiguration of new macroeconomic systems and creation of some new economic institutions (Black, 1998). The role of information technology has been fundamental especially in changing the structure of international production. Firms are automating and integrating their marketing and production of goods and services all over the world. This new technological infrastructure has displaced such barriers to access of high-quality systems and physical market with a kind of virtual market for B2B and B2C consumer transaction (Skipper, 2012).
The provision of services, as well as the production of goods in this new global economy, has been dictated by such economies of profitability. The highly skilled workforce and costly technological infrastructure adopted in production need a kind of marketing niche which requires a huge global market. This is also in addition to such logistics benefits which accrue them with the integration of global production through liaisons as alliance, mergers and hostile takeovers which bring economic transactions under administrative control.
At the center of this technological revolution in information is a key process of commercializing new discoveries and inventions. This is because these inventions are catalysts for structural change which permeates some economic landscape as well as being a marginal and incremental process. This information technology created a kind of economies of a scale where a highly specialized input and labor as well as state of the art is adopted in the production of services and goods. These economies of scale are actually realized when expensive technical and highly specialized inputs are shared towards different outputs. With the advent of technology comes the knowledge-based industry where they invest in a computer, internet, and robots to control industrial production (Archibugi, 2008).
Furthermore, the global market has been necessitated by the internet as more companies are able to reach their clients and advertise as well as sell their goods. The expansion of these markets with the adoption of the internet has resulted in restructuring and reshaping of global industrial activities and structures. The Internet has enabled forms to increase their competitive edge as well as improve their productivity due to high-speed access to data and information as well as computerized inventory and electronic transfers (Choudhry, 2002). It has hence been a driving force behind this economic globalization as well as being an integral aspect of company's business strategy. It has allowed firms to create a global kind of strategies which helps them main and compete in the global environment. With technology, markets are integrating, time condenses while geographical barrier vanishes. Technologies such as instant messaging, email, video conferencing have allowed people to communicate with one another. Applications such as enterprise information technology allow companies interact with the or business partners and employees.
Although globalization has powered most of developing nations through the strengthening of their foreign market position, the introduction of foreign capital, initiating a better technologies and management experience, it has also faced more risks. The report indicates that globalization has reduced such gap between developing and developed countries. These countries still face a threat of unfavourability from external factors. The difference between internal economic stability and realization of an external economy has put pressure on their macro-economies thus weakening both their regulation and control. (Gera, 2008)


In conclusion, globalization has been driven by a combination technological, economic, socio-cultural and transportation revolution as well as financial markets and government policies through the exchange of ideas and trade. Some of the factors which fueled this pace of economic globalization include communication technology, liberalization, and deregulation of economic policies, removal of such capital exchange controls, emerging new markets, change of consumer awareness and transportation. Globalization has, in turn, led to an influx of ideas, technologies, practices and cultural interaction which has impacted on the economic and socio-cultural interaction.














References

Archibugi and Michie. (2009). Technology, Globalization and Economic Performance. . Cambridge.: Cambridge University Press.
Archibugi, H. a. (2008). Innovation Policy in a Global Economy. . Cambridge University Press: : Cambridge.
Black, S. W. (1998). Globalization Technological Change and Labor Markets. Kluwer Academic Publishers: Boston.
Choudhry, N. (2002). Globalization, Growth, and Sustainability. Kluwer Academic Publishers:: Boston. 
Gera, a. M. (2008). The Knowledge-Based Economy: Shifts in Industrial Output. Canadian Public Policy, 149-184.
Kosakowski, J. (1998). The Benefits of Information Technology. Syracuse:: ERIC Clearinghouse.
Lewis, H. M. (2007). An Introduction to International Marketing: Kogan Page Limited, London. 
Mohr, A. (2010). "The Effects of Economic Globalization on Developing Countries". Demand Media.
Ostry, J. D. (2011). Equality and Efficiency". Finance and Development. International Monetary Fund.
Skipper, H. &. (2012). Inter-organizational IT use, cooperative attitude, and inter-organizational collaboration as antecedents to contingency planning effectiveness.
World Economic Forum. ( 2014. ). The Global Enabling Trade Report 2014, Retrieved from http://www3.weforum.org/docs/WEF_GlobalEnablingTrade_Report_2014.pdf.