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What Is Globalization? Research Paper Example

Pages: 1

Words: 323

Research Paper

By globalization economists usually mean the “historical process of increasing international economic integration via reductions in the barriers to trade, capital flows, foreign direct investment, technology transfer and migration” (Snowdon 12).

From an economic perspective, as early as 4,000 years ago, there was an evolution of corporate structures in and around ancient Assyria, which nowadays may be termed ‘multinational’ (Borghoff 30). Early Mesopotamia, in the third millennium BC, was importing raw materials; Babylonian and Indian societies were engaging in trade as far back as 800 B.C. (Borghoff 30).Scholte (62) termed the first emergence of global imagination, in which a “global consciousness began to tease the secular imagination half a millennium ago” and was reflected, for example, in the literature of Shakespeare. Ideas of “globalization” also inspired several voyagers of the fifteenth and sixteenth centuries to attempt a circumnavigation of the earth, a feat first accomplished in 1522(see Watlington77).

The development of global markets was constitutive for economic internationalization. A global market for copper consolidated from the 1850s onwards, interlinking shipments from Australia, Chile, Cuba, England and the USA (Scholte 66). Global pricing dynamics developed in1876 in respect of cotton, wheat, and other cereals, especially between the commodities exchanges at Buenos Aires, Cairo, Calcutta, Chicago, Liverpool, New York, Rio de Janeiro, and Winnipeg (Scholte 67).

Globalization matters due to several reasons. First, multinational enterprises (MNEs) compete in much more complicated competitive environments than do domestic firms (Borghoff 42). Second, globalization involves the integration of corporate activities across borders (Scholte 131). Third, globalization of an industry can be said to be increasing when transactions between buyers and sellers become progressively less dependent on geographic distance (132).

Bibliography

Borghoff, Thomas. Evolutionary Theory of the Globalization of Firms. Gabler Verlag, 2005. Print.

Scholte, Jan Aart. Globalization: A critical introduction. Palgrave Macmillan, 2000. Print.

Snowdon, Brian. Globalization, Development and Transition: Conversation With Eminent Economists. Edward Elgar Publishing, 2007. Print.

Watlington, Phil. The World is at Your Door. Buy Books on the Web, 2006. Print. ISBN: 0741434083

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