Pros and Cons of Globalization – Groupe 2 @ Raleigh

Pros and Cons of Globalization

Pros

Human Resources & Cultural Benefits

  • Enlarge the pool of talented people for companies
  • Ease access to job opportunities worldwide
  • Global access to education through international programs of universities
  • Stimulate innovation
  • Raise awareness about cultural differences
  • Tend to stabilize and prevent political conflicts
  • Increase average standards of living
  • Access to new markets

 

Economical Benefits

  • Stimulate economic growth by allowing bigger markets for companies
  • Increase foreign direct investments beneficial to countries economic growth and health
  • Raise the integration of global trade cycle
  • Boost communication, trades and transport, reducing barriers between countries
  • Create tax competition

 

Cons

Economical Aspect

– Globalization fosters economic growth of MNC’s; give them more and more power (sometimes in the detriment of weakest previously based companies in the targeted country)

– Allow propagation of crisis through a globalised financial system (except the Muslim one)

– Increase global income gap inequality

– Has a bad impact on the national industry  (multinationals become the core and pillar instead of the national companies)

– Inequality of benefit from the globalization between the developed countries and developing countries. The developed countries take more benefits than the developing countries, and at the same time, the developing countries suffer the adverse economic effects of globalization. The national economy of developing countries is facing a greater pressure of continuous expansion of multinational companies and their capital.

Companies outsource their business and it creates unemployment in developed countries for unskilled jobs

Some companies are getting very big because of globalization, they have a bargaining power on governments and world’s economy:

  • Influencing local policies
  • Offshoring in low tax countries
  • Putting pressure to reduce social benefits

Human Resources Aspect

– Retain talents: Brain drain phenomenon (medical in Africa, scientists from Europe to USA..)/Increase the scarcity of high skilled workers in developing economies in favor of well established ones.

 

Cultural Aspect

– Loss of Identity/particularism/specificities for the benefit of a global mindset

 

Environmental Aspect

– Pollution/Global Warming

– Spread of bad consumptions habits