Negative & positive impact of Globalization

1.       Impact of Globalization

a)      Beneficial effects ( assumption):

                                I.            By enabling a greater international division of labor &a more efficient allocation of savings, Globalization raises productivity & average living standards.

                              II.            The atmosphere of competition will increase efficiency in every sector of economy. Inefficient enterprises will improve themselves, privatize or wither away.

                            III.            Broader access to foreign products allows consumer to enjoy wider range of goods& services at lower cost.

                            IV.            Foreign investment & foreign capital will help in optimum utilization of natural resources& employment opportunities will increase.

                              V.            Level of technology will improve because of foreign technology. Through this modern industrialization will strengthen.

b)      Negative consequences:

                                I.            Globalization may have negative impact on employment &real wages, especially of low skilled workers. It may also adversely affect the living standard of some sections of the society. Eg. Rural India.

                              II.            Adaptation of capital intensive technology under Globalization will increase unemployment in the country.  New technology increases output but not employment. ( production of only these goods that are in demand. Not necessarily the basic amenities. Hence pattern of production will be distorted).

                            III.            It is mainly beneficial  to large capitalists &large enterprises are thrown out of competition .consequently there is concentration of economic powers and increase in disparities. (embourgeosement  & polarization simultaneously increased as lower into middle ie. No. of poor has decreased but gap between rich &poor has increased ie. Poverty intensity has increased).  New dimension is Wal-Mart’s retailing

                            IV.            SAP affects govt. priorities. The concept of subsidized goods &  services& welfare is increasingly marginalized.

                              V.            State of food security might worsen with increase in unemployment and poverty. It is a tragedy that even after the disastrous experience of colonialism post- independent state did not  pay serious  attention to the rural areas & agrarian structure. Food crop in the  agricultural sector is neglected. Also because in the decline of  pp of the common man access to food grains is becoming difficult.

                            VI.            As things are taking place, Globalization is posing problem challenge to the sovereignty of number of globalizing countries.

                          VII.            It also affects the socio-cultural fabric of the society. In this the media controlled by global capital plays a important role by spreading the cult of consumerism(creating ‘false needs’ in the words of  ‘HERBERT MARCUSE’ ).