Globalism: concepts, impacts, and contemporary debates

¶ … Future Trends in Globalization

The effects of globalization on international commerce, political systems and financing and trade issues in recent years have become increasingly pronounced and current signs indicate that that the process will continue to accelerate in the future. In this environment, identifying current and future trends in globalization represents a valuable and timely enterprise. To this end, this paper critically examines the future of globalization, including an analysis and forecast of the impact of political, economic, legal, and technological factors on global business. A discussion concerning the most salient financing and trade issues of the different types of economic systems is followed by a summary of the research and important findings in the conclusion.

Review and Analysis

Impact of Political Factors on Global Business.

As the effects of globalization on national economies continues to increase with the elimination of constraining barriers to trade, improvements in production and services will assume more important roles in providing competitive advantages for different countries. In other words, those countries that have political systems in place that facilitate international commerce will enjoy a competitive advantage over those that do not. In this regard, Rodriguqez-Pose points out that, "Factors and constraints that used to be relatively unnoticed, or were ignored, come to the fore as major elements of economic progress. This is the case with political factors, in particular, which until recently (and despite some notable exceptions) were seen as supporting elements in the cocktail of growth and now appear more evident than ever as endogenous constituents of growth" (1999, p. 23). The political leadership of some countries, though, may be reluctant to introduce these opportunities for increased trade for fear it will erode their power base. In this regard, Henry and Springborg emphasize that, "These strategies of 'controlled openings' tend to segment the political economy, so that the degree to which various sectors of the economy are globally integrated varies widely" (p. 15). There are also some important political factors affecting the ability of countries in some regions of the world to become more fully integrated with others. For example, El-Said and Harrigan note that, "Arab regimes that allied themselves with the West are now facing a sea of hostile opinion inside their own societies. America's dream of turning friendly Arab states into 'regional showpieces of globalization' will be difficult to realize with opposition to globalization inside and outside the region continuing to intensify" (p. 445). The impact of political factors on global business, then, will depend on the respective goals of the national leadership that is in place as well as how important they view the need to become more fully integrated in the global economy.

Impact of Economic Factors on Global Business.

Many analysts believe that economic factors will compel developing nations to improve their human rights records in order to become fully integrated with the international community through compliance with controlling regulations in various multinational trading blocs such as typify the European Community and the World Trade Organization. In this regard, Lau (2008) maintains that, "Globalization produces economic incentives to protect human rights, but those incentives are limited" (p. 2021). In some cases, such as Vietnam and China, economic factors will be sufficiently powerful to cause national governments of developing nations to introduce social reforms that help create an economic framework that is more conducive to international integration (Lau 2008). In other cases, most notably North Korea, though, economic factors will remain secondary to the need for the political leadership to retain power (Snowden, 2004).

Impact of Legal Factors on Global Business.

As the 200 or so countries of the world continue to become more fully integrated as a result of globalization, legal factors will play an increasingly important role in how the individual actors interrelate with each other. This process has already been seen in the European Community as the member states have largely subjugated their previous absolute sovereignty in order to accede to membership in the Community because of the enormous economic benefits that are available. Likewise, international law will become more important in resolving conflicts and disagreements between trading nations compared to past practices when bilateral or multilateral agreements were controlling (Ravindran, 2004). Moreover, the enormous opportunities in increased trade represented by globalization, though, may be sufficient to override any remaining reluctance on the part of national governments, particularly among developing nations, to introduce the legal reforms needed to become more fully integrated with the international community (Lau, 2008).

Impact of Technological Factors on Global Business.

Innovations in technology, most especially in information and communications technology but in transportation and supply chain management as well, have represented some of the fundamental driving forces driving globalization in recent years and it is reasonable to expect the impact of this force to continue to accelerate in the years to come, but the jury is still out on the precise level of importance this area will have in the future. On the one hand, Law (2008) emphasizes that, "The membrane of the nation-state is becoming increasingly permeable: not only are governments lowering the barriers to transnational exchange, but their capacity to enforce those barriers is continually undermined by advances in transportation, communication, miniaturization, and digitization technology" (p. 1278). On the other hand, though, Rodriguez-Pose (1999) points out that, "The persistence of long-term growth trends might be due to the fact that the role of technological change and the effects of world economic integration on growth have been overstated, and thus traditional factors producing growth still play the significant part they used to play before" (p. 23).

Impact of Financing and Trade Issues on Different Economic Systems.