ACADEMY OF INTEGRATED CHRISTIAN STUDIES

Topic: Globalizing Economic; Development Corporation, and the rich and the poor.

Submitted to: Rampaukube Hekwet, Asst. Professor. AICS.

Submitted by Lalthanglura Renthlei, M.DIV- II, Roll no 3.

Submission Dated: January 19, Wed, 2022

INTRODUCTION

Globalization is the word used to describe the growing interdependence of the world’s
economies, cultures, and populations, brought about by cross-border trade in goods and services,
technology, and flows of investment, people, and information. Countries have built economic
partnerships to facilitate these movements over many centuries. But the term gained popularity
after the Cold War in the early 1990s, as these cooperative arrangements shaped modern
everyday life. This guide uses the term more narrowly to refer to international trade and some of
the investment flows among advanced economies, mostly focusing on the United States.

The wide-ranging effects of globalization are complex and politically charged. As with
major technological advances, globalization benefits society as a whole, while harming certain
groups. Understanding the relative costs and benefits can pave the way for alleviating problems
while sustaining the wider payoffs.1

The Impact of Globalization on Economic Growth

The goal of globalization is to boost economies around the world by making markets
more efficient. The hope is that increased global trade will lead to more competition, which will
spread wealth more equally. Those who are in favor also claim that trade across borders will help
limit military conflicts.

However, there are downsides to boosting trade between countries. Some critics point to
globalization as a factor in rising nationalism and income inequality, among other issues. Learn
more about the pros and cons of globalization to understand how it affects economies and
individuals.

Benefits of Globalization

The Milken Institute's "Globalization of the World Economy" report of 2003 noted many
of the pros and cons of globalization. Although nearly two decades have passed since the report
1
https://www.piie.com/microsites/globalization/what-is-globalization
came out, the ideas behind it remain relevant. Foreign direct investment (FDI) tends to grow at a
much greater rate than world trade does. This can help to boost technology transfer, industrial
restructuring, and the growth of global companies.

Increased competition helps inspire new technology development. The growth in FDI
helps improve economic output by making processes more efficient, Increased global trade
enables large companies to realize economies of scale. This reduces costs and prices, which in
turn supports further growth. However, this can hurt many small businesses trying to compete at
home.2

Functions of an Economic Development Corporation

An economic development corporation is an organization whose mission is to

promote economic development within a specific geographical area. The function of these
entities is to assist businesses within their respective geographical area to get started, and also to
succeed and grow, helping to develop economic growth.

Many of the services that economic development corporations develop include but aren’t limited
to:

 Providing advice, guidance and resources for people starting up new businesses within
the corporation’s territory
 Offering financial assistance to businesses with grants, loans and tax-exempt bonds
 Assistance with site selection and determining business locations within a community
 Recruitment of new employees for businesses and providing assistance with job training

These services provide invaluable resources for business owners, many of whom would
not have executed in starting up their business without such guidance. Many of the services can
provide a “safety net” for business owners to ensure that their businesses are operating in ways
that can lead to additional profits, which will allow for growth in output and employment. 3

Functions of an Economic Development Corporation

An economic development corporation is an organization whose mission is to promote economic

development within a specific geographical area. The function of these entities is to assist
businesses within their respective geographical area to get started, and also to succeed and grow,
helping to develop economic growth.

More often than not, any individual economic development corporation will operate within one
individual city as their respective region. Economic development corporations and agencies are a

2
https://www.thebalance.com/globalization-and-its-impact-on-economic-growth-1978843
3
https://hardeebusiness.com/resources/functions-of-an-economic-development-corporation
part of every state government and many local-level governments as well. Economic
development corporations work very similarly to Chambers of Commerce, often working in a
complementary capacity. These corporations are quite common in the United States, and are
typically structured as a 501(c)(3) non-profit. Occasionally, economic development corporations
may also be a branch of a government division that acts in the same way, instead of being an
official 501(c)(3).

Many of the services that economic development corporations develop include but aren’t limited
to:

Providing advice, guidance and resources for people starting up new businesses within the
corporation’s territory

Offering financial assistance to businesses with grants, loans and tax-exempt bonds

Assistance with site selection and determining business locations within a community

Recruitment of new employees for businesses and providing assistance with job training

These services provide invaluable resources for business owners, many of whom would not have
executed in starting up their business without such guidance. Many of the services can provide a
“safety net” for business owners to ensure that their businesses are operating in ways that can
lead to additional profits, which will allow for growth in output and employment.

Part of the function of an economic development corporation is to establish an economic base for
their respective region. By establishing an economic base, an economic development corporation
is able to analyze the data collected and determine which areas need particular focus in order to
bring more money into a particular region. The focus is to increase exports and employment. In
this case, exports are not viewed as necessarily international, but simply products or services
which can be consumed by customers outside of a local region, which even at the level of small
communities, is important for bringing new money into an economy. Without exports, an
economy may only recycle the same money over and over again, which causes no growth. Once
an economic base is established and certain industries become a focus for economic
development, working to attract related businesses is one smart way to increase a community’s
employment, which also increases a company’s output, leading to higher exports. Many
industries, such as manufacturing, tourism, technology and artisanship, lead to exports more
easily than others. Playing to a community’s strengths is what is important. It is also important to
decide whether to seek to attract existing businesses looking to expand into new locations or
foster entrepreneurship in local industry professionals who may end up forming new companies.
With these tools and with a helpful array of services, economic development corporations work
to keep the economy of their region growing year after year.4

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https://hardeebusiness.com/resources/functions-of-an-economic-development-corporation
POVERTY

While billions enjoy an affluent style, more than a tenth of the world’s population live in
extreme poverty today. Poverty is not a consequence of limited global resources, but political
and economic injustice. However, the poorest people are almost always at greatest risk from
environmental damage, climate change and competition for resources. The effects of
unsustainable population hit the poorest first and hardest.

The world poorest countries tend to have the largest family sizes and fertility rates. When
people have no economic security and cannot rely on their government and a social safety net,
they often have children to ensure they will be looked after when they are older. Where child
mortality is high, there is an even greater impetus to have more children. Those circumstances
can lead in turn to a culture which values high family size.

This understandable human impulse can contribute to a vicious cycle. Poor families with
large numbers of dependent children may perceive the need to take children out of education
early, or marry off their daughters young. They will also often live in deprived communities
where access to modern family planning is limited. All these factor combine to keep family size,
perpetuating the cycle.5

GLOBALIZATION AND POVERTY

Globalization is the growing integration of economies and societies around the world (Collier
and Dollar, 2001). It ranges from the issues of trade and services, movement of capital, growth
and poverty of the world population, international migration to easier transportation and
communication around the world. It is a complex process that affects many lives and above all,
increased economic interdependence among countries. The International Monetary Fund (IMF)
outlined four basic aspects of globalization - capital and investment movements, trade and
transactions, dissemination of knowledge and the migration and movement of people
(International Monetary Fund, 2000). The process of globalization affects and are affected by
political, economics, socio-cultural, legal and natural factors. Globalization has in many ways
been linked to development across the globe, of which one of the ultimate goals of development
is poverty reduction. With the unprecedented entry of developing and low-income countries into
the global economic integration, the discussion on globalization and poverty has heightened.
Scholars and economists debate on whether globalization is the cause or cure for poverty.

Poverty
5
https://populationmatters.org/poverty development?
Poverty is generally explained as the scarcity or the situation in which a person lacks a certain
amount of material possessions or money. It is a condition in which a community or a person
lacks the essential needs to enjoy a minimum standard of living in the society (Lister, 2004). The
United Nations defines poverty as the inability of getting choices and opportunities. This is
explained in different scenarios as not having enough to feed and clothe a family, not having
access to education and a school to go to, not having access to medical facilities or a clinic to go
to, not having the land to grow food for personal consumption and/or not having the opportunity
to hold a job to earn one’s living. The United Nations sees this a violation of human rights as the
lack of basic capacity to participate effectively in society results in insecurity, powerlessness and
exclusion of individuals, households and communities into the societies’ mainstream.6

CONCLUSION

Globalization is not new. Since the start of civilization, people have traded goods with their
neighbors. As cultures advanced, they were able to travel farther afield to trade their own goods
for desirable products found elsewhere. The Silk Road, an ancient network of trade routes used
between Europe, North Africa, East Africa, Central Asia, South Asia, and the Far East, is an
example of early globalization. For more than 1,500 years, Europeans traded glass and
manufactured goods for Chinese silk and spices, contributing to a global economy in which both
Europe and Asia became accustomed to goods from far away. Following the European
exploration of the New World, globalization occurred on a grand scale; the widespread transfer
of plants, animals, foods, cultures and ideas became known as the Columbian Exchange. The
Triangular Trade network in which ships carried manufactured goods from Europe to Africa,
enslaved Africans to the Americas, and sent raw materials back to Europe is another example of
globalization. The resulting spread of slavery demonstrates that globalization can hurt people just
as easily as it can connect people.7

BIBLIOGRAPHY

https://hardeebusiness.com/resources/functions-of-an-economic-development-corporation
(17.1.21)

https://populationmatters.org/poverty development? (17.1.21)

6
https://repository.upenn.edu/cgi/viewcontent.cgi?article=1079&context=bepp_papers
7
https://www.nationalgeographic.org/article/effects-economic-globalization
https://repository.upenn.edu/cgi/viewcontent.cgi?article=1079&context=bepp_papers (17.1.21)

https://www.nationalgeographic.org/article/effects-economic-globalization (17.1.21)

https://www.piie.com/microsites/globalization/what-is-globalization (17.1.21)

https://www.thebalance.com/globalization-and-its-impact-on-economic-growth-1978843
(17.1.21)