Globalization

Trade

Globalization has created and expanded foreign trade throughout the world. This leads to developed countries being able to export their goods to other countries. With countries conducting business through international trade, they are able to globally import and export goods. (Positive and negative effects of Globalization)

An example of this includes NAFTA. NAFTA promotes the free trade across North America without the burdens of most tariffs. This further benefited the countries due to the decrease in prices of goods, increase in exports, and generally helped take advantage of the strengths of different countries.

Increase in Cultural Awareness

It is found that a globalized society boosts the rate at which individuals are exposed to culture and values of individuals in different countries. This can potentially strengthen ties between nations along with generally increasing cultural awareness. (Josephson, The Pros and Cons of Globalization)

An evident and well known example of cultural awareness in society is the development of the United Nations further helped maintain international peace, develop friendly relations amongst nations and to generally achieve international cooperation.

Several positive changes in regards to cultural awareness have been made within society as a result of globalization. Cooking styles, languages, customs, arts, and more, have all spread throughout the world. (Positive and negative effects of Globalization)

There are several examples of cultural globalization. One example can include coffee which is said to be originaly from Ethiopia however, due to commercial trades, it is now globally consumed commodity. Another example includes avacodos which are grown mostly under the tropical temperatures of Mexico, Dominican Republic or Peru. However, nowadays, they are much more common throughout the world.

Higher Standards of Living

Despite increasing inequality amongst individuals as a result of globalization, it is evident that developing nations have experienced an improved standard of living due to globalization. Millions to billions of individuals have been found to move out of extreme poverty overtime.

Developing countries have become more industrialized to meet the needs and demands of a global economy. A statistic found by the World Bank where it was found that extreme poverty decreased by 35% since 1990. As well, with a target to cut the 1990 poverty rate in half by 2015, instead, this had been achieved five years ahead of schedule.

Within developed countries, individuals have obtained a higher standard of life due to the accessibility of goods made available by the globalized economy

Competition

An apparent positive effect of globalization includes the improved quality of products due to global competition. Companies are compelled to raise their standards and customer satisfaction in order to survive in the market.

In regards to fast food places, Tim Hortons, a Canadian company, has been found to expand their product offerings overtime to better compete with other fast food places, for instance, McDonald's. This led to not only a greater variety but also better quality products served within Tim Horton's to compete with others.

Competition

Despite an increase in competition leading to improved quality of products, globalization has also led to fluctuation in prices. With an increase in competition, developed countries are forced to lower prices of their products, potentially due to prices in competitive countries. For instance, some countries may lower costs of their goods for them to be cheaper than ones in developed countries. (Positive and negative effects of Globalization)

One of the major effects of globalization is also evident within the coffee market. With the increased globalization of coffee, the prices have steadily dropped due to the increased production in several parts of the world. Despite the increased demand, there has been an overproduction leading to prices plummeting, found in October 2001.

Due to globalization, local organizations may have difficulty competing with large multinational corporations. For instance, a local mom and pop shop may have difficulty competing with multinational corporations such as Walmart.

Rise in Inequality

Globalization has been linked to inequalities between the wealthy and poor. Lower skilled occupations face greater competition as a result of globalization as opposed to higher skilled occupations. This in turn leads to wages remaining low among lower skill level occupations. Through globalization, wages of selective segments of the workforce increase, specifically occuring in the high-tech manufacturing sector and services sector. These industries are typically dominated by highly-skilled, educated workers, drawn from the wealthiest segments of the population. However, the poorer and typically lower-educated sectors face greater competition from workers in lower-cost countries leading to wages being kept low to compete. (Parlia, Globalization Fuels Inequality)

Lower Standards of Living

Higher level of competition has led to lower standards of living as it results in lower profitability margins.

Increases Carbon Dioxide Emission

Carbon emissions have increased due to globalization of transportation and higher levels of production to meet the demands of a global economy.