Reflect of Globalization on International Business Essay

1478 Words 6 Pages
Globalization refers to the increasing unification of the world's economic order through reduction of such barriers to international trade as tariffs, export fees, and import quotas. The goal is to increase material wealth, goods, and services through an international division of labor by efficiencies catalyzed by international relations, specialization and competition. It describes the process by which regional economies, societies, and cultures have become integrated through communication, transportation, and trade. The term is most closely associated with the term economic globalization: the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, the spread of …show more content…
Due to the effect of the latter, the natural barriers of time and space have been vastly reduced. At present, the cost of moving information, people, goods and capitals across the glop has fallen dramatically which in turn vastly expanded the feasibility of economic transactions across the world. As to this, people believe that markets can be global in scope and encompass an expanding range of goods and services.
With the intention to benefit international communities on equal footing, various institutions were created. Among others, UN, ILO, WTO, GATT and IMF are the most influential ones. These institutions set certain preconditions that states shall fulfill to get membership. Beyond that, a number of laws are issued to liberalize international business transactions. By this, it is sought that regional cooperation in trade and finance could increase stability.
As it is mentioned above, globalization can have both direct and indirect impact on states. It would also inevitably affect the laws of international business transactions either negatively or positively. As to the former, the challenges against globalization may dictate the revision of these laws in a manner which may equally benefit the poor and the rich. The question that must be capitalized is whether these laws are in positions to treat the north and the south as there is unbridgeable gap between them. If states are to be benefited from the globalization, most argue that there must be fair laws which

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