Course title: Principles of Eco -II

Course code: ECO-104

Department: English

Semester: 7th

ID NO: 180102040002

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Introduction
Economic globalization is one of the three main dimensions of globalization commonly
found in countries, academic literature, with the two others being political
globalization and cultural globalization, as well as the general term
of globalization. Economic globalization refers to the widespread international movement of
goods, capital, services, technology and information. It is the increasing economic integration
and interdependence of national, regional, and local economies across the world through an
intensification of cross-border movement of goods, services, technologies and
capital. Economic globalization primarily comprises the globalization of production, finance,
markets, technology, organizational regimes, institutions, corporations, and labour.
While economic globalization has been expanding since the emergence of trans-national
trade, it has grown at an increased rate due to improvements in the efficiency of long distance
transportation, advances in telecommunication, the importance of information rather than
physical capital in the modern economy, and by developments in science and
technology. The rate of globalization has also increased under the framework of the General
Agreement on Tariffs and Trade and the World Trade Organization, in which countries
gradually cut down trade barriers and opened up their current accounts and capital
accounts. This recent boom has been largely supported by developed economies integrating
with developing countries through foreign direct investment, lowering costs of doing
business, the reduction of trade barriers, and in many cases cross-border migration.

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The Impact of Globalization on Economic Growth

Globalization is a recent issue which has its pros and cons. In a developing economy like
Bangladesh the impact of globalization is diverse and complex. In the last three decades
Bangladesh has been showing steady economic growth rate. One of the reasons for this
economic growth is globalization. This paper will try to look at the impact of globalization on
poverty situation in Bangladesh in the 1990s. It also portrays a brief idea how globalization
could play an important role in the poverty situation in a developing economy. This paper has
concluded that, globalization mostly had positive impact to poverty reduction in Bangladesh
especially in the rural areas during 1990s; but it is also reality that, the inequality between the
rich and poor broadens within this period of time in Bangladesh.
Bangladesh for the last three decades the economy of Bangladesh keeps a constant positive
growth. In the last one decade Bangladesh have experienced GDP Growth rate 5% or
above. Although Bangladesh have been making significant progress in eradicating poverty
over the last two decades. Poverty has reduced from 56.6 percent in 1991-92 to 31.5 percent
in 2010. In the 1990s GDP grew at the annual average rate of 4.8 per cent in the 1990s
compared to 3.7 per cent in the 1980s. One of the reasons for this economic growth is
globalization process in Bangladesh.
In simple words globalization is the ‘compression of the world’ with ‘the intensification of
the consciousness of the world as a whole’

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Globalization Benefits World Economies

The Milken Institute's "Globalization of the World Economy" report of 2003 highlighted
many of the benefits associated with globalization while outlining some of the associated
risks that governments and investors should consider, and the principles of this report remain
relevant.

Some of the benefits of globalization include:

Foreign Direct Investment: Foreign direct investment (FDI) tends to increase at a much
greater rate than the growth in world trade, helping boost technology transfer, industrial
restructuring, and the growth of global companies

Technological Innovation: Increased competition from globalization helps stimulate new

technology development, particularly with the growth in FDI, which helps improve economic
output by making processes more efficient.

Economies of Scale: Globalization enables large companies to realize economies of

scale that reduce costs and prices, which in turn supports further economic growth. However,
this can hurt many small businesses attempting to compete domestically.

Some of the risks of globalization include:

Interdependence: Interdependence between nations can cause regional or global instabilities

if local economic fluctuations end up impacting a large number of countries relying on them.

National Sovereignty: Some see the rise of nation-states, multinational or global firms, and
other international organizations as a threat to sovereignty. Ultimately, this could cause some
leaders to become nationalistic or xenophobic.

Equity Distribution: The benefits of globalization can be unfairly skewed towards rich
nations or individuals, creating greater economic inequalities.

Future Outlook

Economists suggest that nowadays, cross-border investments are not being made so much to
build capital infrastructure as they are to seek countries with the lowest taxes. Some form of
globalization may be inevitable over the long-run, but the historic bumps spurred by
economic crises and other consequences suggest that change is the only reliable constant.

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According to U.S. Customs and Border Protection, escalated U.S. tariffs on Chinese imports
raised $20.8 billion through mid-July 2019. American farmers hurt by China diverting crop
purchases to other countries were promised $28 billion in federal compensation, making it an
overall net loss.

Conclusion

At this stage, economic analysis is limited by a dearth of data and by the lack of a
comprehensive empirical framework. Although available evidence suggests that the
globalization of MSE R&D has had a limited impact on the U.S. economy so far, the
medium-term impact is highly uncertain. A positive impact will depend on globalized MSE
R&D leading to increased U.S. productivity and contributing positively to U.S. domestic
innovation.

Reference

Internet:
https://www.thebalance.com
https://en.wikipedia.org
https://medcraveonline.com
https://www.nap.edu
Book: ECONOMICS
ROGER A. ARNOLD
Thirteenth Edition

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