Globalization And Production Globalization On Business Essay

813 Words Sep 14th, 2015 4 Pages
Globalization can be refers to the changes in the world where we are moving away from self-contained countries and toward a more integrated world. Globalization of business is the change in a business from a company associated with a single country to one that operates in multiple countries. The impact of globalization on business can be placed into two broad categories market globalization and production globalization. Another consequence of bilateral trade agreements is the access to cheaper resources. Until the start of the 1990 's, the People 's Republic of China was largely closed off to the rest of the world. Many companies in the United States produced their goods either domestically or in areas with slightly less expensive labor. When China opened its market to the rest of the world, however, American companies were able to take advantage of the far cheaper labor. This is known as outsourcing. Cheaper labor contributes to cheaper costs, which in turn contributes to larger profits. Sometimes, but not always, this may also mean cheaper products and services. International development, as a consequence of globalization, arises out of a combination of both expanded markets as well as cheaper resources. However, coupled with an educated yet inexpensive workforce, foreign companies were able to start subsidiaries of high tech activities in cities like Bangalore. This technological know-how spread to local firms, who in turn grew as a result of expanded markets both in…

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