RAYMART M.

COPIAR ACTIVITY
#4

BSA – 501

Do you think globalization and MNE activity are creating problems for the world? What
kinds of problems can you identify? What are the unintended consequences of
international business?

It is true that globalization has opened doors to many job opportunities and every other
country is trying to get their hands on cheap and quality labor. This may appear advantageous
on one hand but on the other all these jobs are taken from one country and given to other nation
on the basis of cheap and quality labor. I think globalization and MNE activities are causing
problems for the world. Some of the problems that are obvious include the influences of some of
the global companies have on some countries governments especially developing countries.
They use their powers to manipulate activities in those countries. Another problem is the loss of
national sovereignty/ many countries lose their own culture due to the globalization and MNE.
Finally, environmental pollution are problems that result from globalization and MNE which
includes oil spillage by global companies operating in the oil sector.

Another unintended consequences due to multinational operation is targeting the

countries resources to their fullest. MNE’s thus over utilize the power and labor is not paid
properly and their resources are exploited beyond their normal work. Most of the third world
countries are employing child labor which is affecting the children as they cannot attain proper
education and other necessities of life. Some unintended consequences are the causing large
disparity between the rich and the poor especially in developing and least developed countries.
Another unintended consequences could be increase in the figures of unemployed people in
some countries after the movement of company to another country. Considering the debate
among business executives, activists and trade officials the effect of globalization is clearly
evident not only on human beings but also on culture, industry and environment.

Summarize the arguments in favor of globalization that the business executive made.
What is the role of technology in supporting company performance in a globalizing
business environment?

The greatest advantage to a company of globalization is that it helps in cost savings as

cheaper labor is available elsewhere and so production operations should be located there.
Globalization also allows technology transfers as it allows technology from foreign countries
being transferred there. This allows a development of human capital in the country and a
cutback on costs. Globalization also allows the development of intangibles and so allow an
increment to profits and thus improves the productivity of the company. Technology is crucially
important for an organization in developing quality levels of human capital and also allowing
better quality output to be produced. Technology is thus very important in ensuring that the
benefits of globalization reflects to the company as a whole and bring about efficiency.

Globalization has provided opportunities not only to companies but also to the
individuals from the grass root level as they offer better jobs to people across the globe.
Companies are earning enhanced profits and are also able to retain the quality level of their
product or service for their customers. Globalization increase working opportunities which also
increase competition and increase global awareness of issues at the collective level.
Globalization increase living standards of the nations in which they operate, because when
living standard are improved awareness about better working opportunities in also increased.

Globalization has significantly improved transportation levels and has made the world
accessible to everyone especially for the merchants to expand their trade to new markets. Most
of the business executives are of the view that globalization has increased competition which
has further triggered introduction of new technologies. Globalization is a platform which is
providing poor countries with prospects to invest in foreign technology and to develop
themselves economically. Trade has always been the central element between nations however
the scale of trade varies depending on the availability of resources. Most of the economists are
of the view that globalization has proved to be advantageous for every economy around the
world. The introduction of technological advancements has increased competition and has also
made the market more efficient.

What are the roles of state and federal governments in dealing with globalization? What
is government’s role in protecting citizens from the potential negative effects of foreign
MNEs conducting business in your country? What kinds of government actions would
you recommend?

There are a lot of issues pertaining to globalization, concerns and hopes about
international investment revolve in many ways around what governments may do. This means
both what governments may do to regulate foreign investment, perhaps to make it less volatile,
as well as actions government may take simply to get out of the way of the market, clearing the
existing barriers to capital. The ability of governments to prevent or reduce financial crises also
has a great impact on the growth of capital flows. Abilities to address these crises include
strengthening banking supervision, requiring more transparency in international financial
transactions, reducing the risk of moral hazard, and ensuring adequate supervision and
regulation of financial markets.

The role which government can play in dealing with the negative consequences arising
from globalization requires institutions of governance to create infrastructure which can attract
foreign investment. Once the range of services are provided by a less developed country then it
can act as a facilitator in promoting foreign investment in a country. One recommendation for
the government to taking full advantage from the opportunities of globalization is to make
banking and financial sector operate in a transparent manner. Further government is also
required to take steps to keep the inflation rate of the country to a minimum through a sound
monetary policy. Governments should also take steps in simplifying their regulation system for
new business registration and licensing of businesses.

The government needed to properly monitor the financial flow and economic ups and
downs of the system. Hence the ability of government to prevent themselves from facing any
economic depression phase allows that country to direct cash flow towards them. The states
which can dynamically adjust themselves with the changing transformations win the race and
they emerge as developing nations on the globe. Thus it is required that institutions should be
made strong and the rule of law must be established.

What is the role of education in

(i) addressing the problems raised in the roundtable;

Education is significant because it helps in achieving the level of perfection and

policy levels which every country dream to attain while going global. The expansion of
higher level education create an environment where skills are developed. Considering
the responses of business executives it is clearly evident that globalization help in
raising the standard of living and level of economy for the nations which are involved in
the transaction. Social inequality was another concern raised by the participants thus for
addressing this issue education is the only resource which can create prospects for
achieving social equality at all levels. Thus education will provide people with the skills
and values required for thriving in economic globalization and for reducing its
undesirable impacts.

(ii) creating societies in which people can deal effectively with public policy
issues; and

The globalizing forces significantly affect the policies of nations especially in education
as they should work in harmony with each other to formulate polices which promote
technical and skill based education. It is the government role to create societies where
people work on spreading education and resolve their issues by having proper dialogue.
Overall the government has to play its role in improving their investment policies and
should provide flexible investment and saving opportunities to the investors which will
eventually help investor to enter into the liberalization market.

(iii) creating citizens who can compete effectively in the global marketplace?

Education act as a foundation for global stability as it helps in increasing

multicultural awareness and it also helps the citizens of a country in integrating
ideologies from different cultures. Therefore education plays a vital role in inducing
multicultural awareness from an early stage. Further it is globalization which yields an
increased quantity of technically and scientifically trained persons. It must be
remembered that every emerging economy is based on the foundation of education and
knowledge.