TABLE OF CONTENT

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INDEX
Introduction
Recent Trend Globalization
Impact Of Globalization
Positive Impact Of Globalization
Negative Impact Of Globalization
Sweatshop
Stop Sweatshop
Ethical Company
Awareness Of Customers
Conclusion
References
Marking Scheme

1.0 TRODUCTION
DEFINITION OF GLOBALIZATION
Globalization is a multidimensional phenomenon that not only touches political, economic,
social and cultural spheres of any society but also reshapes the traditional way of studying the
social world and human nature (Robinson, 2005). Globalization is often associated with
intensification of the worldwide social relations, global economic integration, deterritorialization and time-space compression (McGrew, 2008). Tomeasure its extensity and
impact on a particular society it is needed to analyze each of these aspects separately.
Globalization is also can be consider to be the process of greater interdependence among
countries and their citizens. It consists of increased integration of product and resource
markets across nations via trade, immigration, and foreign investmentthat is, via
international flows of goods and services, of people, and of investment such as equipment,
factories, stocks, and bonds. It also includes noneconomic elements such as culture and the
environment. Simply put, globalization is political, technological, and cultural, as well as
economic. In terms of peoples daily lives, globalization means that the residents of one
country are more likely now than they were 50 years ago to consume the products of another
country, to invest in another country, to earn income from other countries, to talk by telephone
to people in other countries, to visit other countries, to know that they are being affected by
economic developments in other countries, and to know about developments in other
countries.

RECENT TREND GLOBALIZATION

Economic globalization is not a new phenomenon. Trade, capital and people have been
flowing across borders for centuries, with the intensity of these flows growing significantly
since the middle of the 19th century. Whilst the process of globalization has not been smooth,
with significant setbacks experienced especially during the interwar period, it is reasonable to
conclude that, with the exception of international labour markets, the degree of integration in
terms of global trade and capital flows has been on a broadly rising trajectory over time. This
long run tendency towards growing worldwide economic ties has been driven by both
improvements in transport and communications technologies and by public policy initiatives,
although the latter have not always been beneficial to the integration process. These driving
factors have acted to significantly reduce the cost and non-cost barriers to transporting goods,
services and factors of production (labour, capital and knowledge) across national frontiers,
with significant benefits for the world economy. In terms of structure, the present section will
provide a short overview of the broad, long term, trends for globalization.

2.0 IMPACT OF GLOBALIZATION

Globalization has had an increasingly significant impact on international marketing. More and
more markets become open to international organizations as the cost and complexity of
operating overseas is reduced by globalization. One of the key drivers of increased
international marketing has been reduced costs as a result of globalization. Organizations are
able to access cheap resources and labour in developing countries. This not only allows them
to price their products lower, but also opens up a broader market of people with the disposable
income to buy more goods and services. New and ever improving communications
technology has spread throughout the world, allowing international marketing campaigns to
be coordinated all from a domestic base. The internet and mobile phones have opened up
entirely new international industries with endless potential. Globalization has changed the
way people shop. Consumers are better able to shop around for good deals and are prepared to
buy from overseas without necessarily viewing products first hand. The Impact of
Globalization. Globalization has also increased market competition, in turn increasing the
importance of effective international marketing. Many organizations cannot rely on the fact
that they are the only player in a long held domestic market, there are new competitors from
overseas appearing all the time. Transport and distribution systems are more efficient than
ever before, making it easier, faster and cheaper for businesses to get their products to
consumers. Electronic transfers have also made making and receiving international payments
faster and more secure. Finance is more readily available to both consumers and
organizations, thanks to the globalization of many financial providers. Investors are interested
in spreading their investments over a wider range of markets to reduce their overall level of
risk. An increased availability of capital makes it easier for organizations to finance their
international marketing efforts. Globalization will continue to bring more and more buyers
and sellers together into the future. The organizations that are able to make the most of the
opportunities globalization provides stand to the best chance of succeeding in their
international marketing campaigns.

2.1 POSITIVE IMPACT OF GLOBALIZATION

There are many positive impact of globalization that can be seen it will help to develop the
developing nation or countries. Transfers of technology depends on resource available by
MNCs with the ability to achieve the level of technology development in order to make them
competitively in global market. Usually developing countries unable to do research and
development on their own as the technologies that required implementing the competition
strategy are most likely to come from other countries through technology transfer (Stewartet
al., 2003). Hipkin and Bennett (2003) stated that the extent of developing countries,
participation in global economy depend on their ability to respect where the importance of
technological transfer cannot be overemphasized. There are ten modes of technology transfer
which has been identified by Peter Buckley (1985, citied in Transnational Corporations and
Technology Transfer to Developing Country) but the most conventional form will be wholeowned subsidiaries. This form is also known as FDI where MNCs can lower their transaction
cost (Cantwell and Dunning, 1994).

Hence technology transfer to subsidiary in other

country allow developing country to learn the operation of new technology. Sometime
subsidiary didn't allow local firms to learn but they somehow find their way to obtain the
technology such as hiring operator from that particular subsidiary (Mansfield and Romeo,
1980).
1. Globalization Increases Free Trade
Globalization has increased the free trade between countries. The increases capital liquidity
has allowed investors in well developed nations to invest in developing countries. Huge
corporations from developed nations have great flexibility to operate in other countries. As
developed countries are able to move their operations into developing countries, new job
opportunities open up for local workers. Increased levels of employment lead to a higher
standard of living and more consumer purchasing. This ultimately sparks the country's
economy and may help to develop locally owned.
2. Global Mass Media Ties World Together
The increased flow of communication has allowed global mass media to tie the world
together. Global mass media has allowed vital information to be shared between corporations
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and individuals around the world. Globalization has also contributed to greater speed and ease
of transporting goods and people. This will speed up the information transfer and making less
delay on vital information from host countries and home country. Example due fast
information sharing many MNC can send and receive the information fast due to implement
of internet. The developing countries can benefit from this globalization of mass media.
3. Eradicates Cultural Barriers
Countries joining together economically through politics and education have reduced and can
even eradicate cultural barriers, and increase the global village effect. Globalization has seen
to be the medium to spreading of democratic ideals to well developed nations and greater
independence to developing countries in the Global South. Example due to globalization
many countries had open their door to new culture and not static to tradition culture only.
Countries like India and China had open their culture to the new and modern culture that can
make them equal to other nation.
4. Increase of Agriculture
Globalization had increased the scope for earnings from agriculture with the implement and
the introduction of new technology and machine. This can improve the way of many
developing nations exploit their agriculture sector.

Example due to globalization many

developing countries like Indonesia, India had change their agriculture system to new and
modern technique of agriculture. Like Sime Darby introduce the modernize system of
agriculture toward people of Sumatra Indonesia.
5. Increase in Job
Many MNC go to developing countries for expending their business due to cheap labour and
this will eventually create more job opportunities for the citizen of any developing countries.
For example, Toyota open it factories at Thailand due to cheap labour in Thailand and making
a job opportunity available for unemployed Earthquake in Japan Toyota shift it production to
Thailand and give a lot of job to Thai people. Many developing countries eventually benefit
from globalization

2.2 NEGATIVE IMPACT OF GLOBALIZATION

Woods (2000) stated that the government of developing countries start to compete with each
other by deregulate their policy to attract foreign direct investment (FDI) and multinational
corporations (MNCs). Hence with lower the wages and taxes rates enable the investors to
avoid the risk of losing their capital invested in developing country. Research done by The
Economist (2001) and Woods (2000) and found that when the government of developing
countries increasing minimum wage and labour safety standards in order to protect local
workers' rights, this might could cause MNCs relocate their operation to another developing
countries, where that particular country's labours, who were probably willing to accept low
wages by any standards, lack of union representative and legal protections such as child
labour and other gross labour that abuses by global companies.
1. Pollution to Environment
Many MNC had introduces many new technologies toward developing nation like Indonesia
and African nation but some Technology had negative impact on environment like the burning
of forest in Sumatra Indonesia and air pollution in China. Some MNC think only profit and
not environment safety like example a MNC that make a palm oil plantation in Sumatra had
make deforestation by cut down trees and open burning that result to heavy haze in South East
Asia countries like Malaysia.
2. Labour Abuse
Many MNC company had employ worker from developing countries like India, China,
Thailand and Vietnam. Some MNC company had abuse worker by given low payment or poor
working condition and some abuse by taking child as worker. This clearly a violated the law
that PBB and WTO had setup which some MNC company ignore or fail to complied.
Company like Nike and Apple had done a labour abuse by taking child as a worker. The
serious cases of labour abuse are in China, India and half of African nation like South Africa.
3. Controlling Economic
MNC or develop countries use globalization to control some developing countries in term of
economic where some develop countries will control economic market for exchange of FDI.
This result of some developing countries will have develop countries controlling their
economic for a very long period of times.
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4. Technology Transfer
The impact globalization can also bring negative impact to developing country. Certain MNC
transfer their technology to developing country as those technologies might cause health
problem to employees as well as local citizens. Example would be Bhopal disaster caused by
America MNCs' subsidiary, Union Carbide India Limited that produces pesticides.
Sophisticate technology bought into India but the leakages of chemical caused more than
500,000 people suffer from the disaster (Eckerman, 2005).

3.0 SWEATSHOP
Sweatshop (or sweat factory) is a pejorative term for a workplace that has socially
unacceptable working conditions. The work may be difficult, dangerous or underpaid.
Workers in sweatshops may work long hours for low pay, regardless of laws mandating
overtime pay or a minimum wage; child labor laws may also be violated. The famous case of
sweatshop is Nike in China where Nike use child as labour for making football shoes and
soccer ball for world cup event. This happen when Nike had a lot of order of shoes and soccer
balls due to world cup event and Nike had to result of taking more workers. This include
worker underage or worker below 18 and this had violated the international law of restriction
to underage for working in any sector all over the world. Other example is Foxconn company
in China force worker to worker more than 10 hours a day and share bed among worker due
to the company had being bought by Apple and Apple is trying to mess produce the
motherboard or circuits board for IPhone 1 and IPad. The result of this many workers quit and
about more than 20 workers either committed suicide of male and female by jumping from the
Foxconn factory or eat poison. This incident had make Apple and Foxconn being sue by WTO
which result of Apple follow the international law of working hours and working condition.

4.0 STOP SWEATSHOP

Consumer pressure can effectively reduce the use of sweatshop labor and child labor. Early in
the twentieth century, consumer groups helped to bring about the implementation of labor
standards in the United States that abolished child labor, required a minimum wage, and
protected the right to collective bargaining. In the 1990s, several companies responded to
consumer outrage against sweatshops by establishing corporate codes of conduct rules that
ban the abusive treatment of workers in manufacturing plants. Although these codes have
been inconsistently enforced, they set the groundwork for the Apparel Industry Partnership, a
coalition of concerned garment companies, unions, and human rights organizations. This
coalition is developing an industry-wide standard of conduct that prohibits exploitative work
conditions. Furthermore, persistent consumer activism has led several cities to adopt
resolutions banning the sale of sweatshop-made goods. Ruth Pearson defines Corporate Social
Responsibility (CSR) as the commitment of business to contribute to sustainable economic
development, working with employees, their families, the local community and society at
large to improve the quality of life.

4.1 ETHICAL COMPANY

A company working as an ethical business has many benefits, not least of which is the ability
to attract and keep investors, employees and customers. Knowing that the company they deal
with has stated their morals and made a promise to work in an ethical and responsible manner
allows investors peace of mind that their money is being used in a way that aligns with their
own moral standing. When working for a company with strong Business Ethics, employees
are comfortable in the knowledge that they are not by their own action or inaction allowing
unethical practices to continue. Customers are at ease buying products or services from a
company they know to source their materials and labour in an ethical and responsible way. A
business has a place in the community, whether that is a literal community around them
premises or a virtual community of customers and other businesses. Create awareness among
workforce of the importance of having a positive reputation in community. Any company
must have social equity right to all their worker in developing countries and it means that the
populace in a developing countries has a fair opportunity to earn a living wage, receive an
appropriate education, and have access to other resources and rights vital to human wellbeing. Lack of social equity (social injustice) occurs when oppressive regimes deny full
political rights and participation and although social injustice can exist in democratic regimes,
as well. The concept of social equity is that each society has a stock of social capital, that,
when invested properly, can create the possibility of human thriving, not just merely
surviving.

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4.2 AWARENESS OF CUSTOMERS

Boycotting unethical companies, individuals and companies can positively influence the
whole business world. When an unethical company finds itself with no customers, no
investors and no suppliers, it will be forced to change its ways or go out of business and
constant striving for better and more ethical dealings in this way produces a cycle of
continuous improvement. Consumer hat the power to stop by boycott any company that make
sweatshops or unethical business. Consumer need to be aware about the product that their buy
and their can stop unethical company by stopping the buying process of product from the
unethical company. No sweat is a campaign that urge a company to stop sweatshops and for
consumer is to boycott any MNC or company that regulate sweatshops policy in their
company. This campaign will help to change a company to have ethical business policy and
not only thinking long term profit but also long term customer or consumer. Awareness of
consumer about sweatshops must be strong so that unethical business will eventually stop for
good. WTO had band sweatshops policy and many countries had imposed a law or awareness
of sweatshops among consumer. Boycotting is one part of fighting sweatshops but awareness
of consumer is the long term solution of fighting sweatshops for good.

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CONCLUSION
In Conclusion there are evidently positive and negative consequences of globalization. These
effects are either direct results of globalization or indirect results caused by factors linked to
globalization. Throughout this essay I have stated many of the major effects globalization has
caused to our world system. Many of these effects have been around since the beginning of
globalization however some are more recent issues such as the internet and terrorism. It is
clear that globalization has had many positive effects to world markets. Globalization has
helped open up new trade areas where developing can benefit from a range of beneficial
outcomes such as new employment opportunities and greater economic development. As
stated previously not all developing countries have benefited from the spread of globalization
and in fact many developing countries have been exploited. In order to sustain globalization
and to limit negative outcomes MNC need to be regulated to stop further exploitation. If
globalization continues to
aid the flourishment of global capitalism a sense of social responsibility needs to develop
alongside it. As our awareness or access to knowledge grows we must take responsibility for
our actions. Failure to do so means we will live in a continually polarized world where the
gap between the rich and poor continues to cause global atrocities and growing instability
such as global terrorism that happen now.

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REFFRENCE
List of journal use is
1.
2.
3.
4.

Impact of Globalization
Globalization and Environment
Impact of Globalization on Labour
World Bank on Globalization

List of book use

1. International Economic 10 Edition
2. International Economic 11 Edition
3. International Economic 12 Edition

MARKING SCHEME

Marking Base

Percentage (%)

Relevant

20%

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Knowledge

20%

Analysis

20%

Argument and structure

10%

Critical Evaluation

20%

Presentation

5%

Reference to literature

5%

Total

100%

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