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Running head: GLOBALIZATION AND WORK 1

Globalization and Work

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GLOBALIZATION AND WORK 2

Dimensions of Globalization

Globalization refers to the global integration of economic, financial, trade and

communications. Globalization is a process, and it cannot be achieved overnight but is

influenced over the years. Globalization is marked by free trade, capital flow, and tapping of

cheaper foreign labor markets across national frontiers. Globalization can be taken as a process, a

project and as a practice. This paper focuses on the three mentioned dimensions of globalization

in details.

While taking globalization as a process, the interconnectedness between globalization

and financial markets is evident. Capital markets are considered to be the major factor

contributing to globalization as it succeeded in becoming globally liberal. The financial markets

primary aim is to obtain profits. However, there are other aspects related to it. In a bid to

conform to international financial market standards and requirements, many countries have

become globalized. Globalization, in this case, is achieved through a process.

No country is self-sufficient in a global economy. Each state is involved in the trade to

sell the surplus produce or purchase what such States lack. In world trade, exchange of goods or

services takes place across nations and promotes economic efficiency hence products are

available in wider varieties and at a lower cost. Global trade grows and faces changes and legal

regulations over time, and this is, therefore, a process as it has sequences and rules.

Foreign direct investment (FDI) refers to an investment made by an individual or a

company to an international company either in one's country or another country. The mentioned

aspect of investment has become a crucial engine of economic growth among nations. The FDI

has influenced both economic conditions and policies in various countries. Economic distance

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between countries has reduced, capital movements exploded, transfer of wealth and knowledge

have increased and trade. Foreign direct investments are a key driver of globalization.

Globalization can be taken as a project, that is, several planned endeavors are undertaken

to bring about globalization. Neoliberalism refers to a collection of economic policies that argue

for reduced state involvement in the economy and endorsement of free enterprise

entrepreneurship to boost the well-being, economic effectiveness, and personal freedom. It is a

core set of capitalist ideas as opposed to a formerly usual form of liberalization. Neo-

liberalization is believed to be the primary driver of globalization, and it can be seen as the effect

of global neoliberalism.

Neoliberalism has influenced many states though they may not illustrate a firm

commitment to domestic neoliberal ideas. International Financial Institutions (IFIs) have

promoted removal of capital controls, and trade barriers while attempting to make the global

economy liberal. On the other hand, trade globalization can be attributed to neoliberal

institutionalism or classical liberal theory that promulgates that a nation can increase its

economic gain by specializing in production and trade of goods it can produce cheaply.

However, the neoliberal policies on economic have accelerated income inequality hence

jeopardizing expansion and risking economic growth in the world. Due to neoliberal

globalization, some states have the better economy than others as economic growth favors some

nations better than others.

The consideration that globalization is the international aspect of a wider component of

neoliberal reform leads us to a conclusion that the current escalation in the inequality among

different income levels is as the result of neoliberal reform. Neoliberal reform has led to an

GLOBALIZATION AND WORK 4

increased income inequality in various ways. For example, the neoliberal reform of welfare and

tax systems has contributed to less social security and less progressive of tax regimes, thus

escalating the inequality in the distribution of the post-tax income among different income levels.

Besides, the neoliberal reforms have led to labor market inequality in some ways. For instance,

the highly-skilled workers and managers have been favored by the neoliberal reforms. Also, the

reforms have increased the wages for the highly-skilled employees, on the other hand, reducing

the salaries of the less-skilled people, thus leading to the inequality in different experience levels.

Over the years, there has been a diminution in trade barriers such as quotas and tariffs.

This decrease has resulted in increased world trade with relation to GDP and output. The World

Trade Organization's (WTO's) policies on lowering trade barriers are as a result of neoliberal

institutionalism theory as they emphasize economic efficiency and business gains due to

comparative advantage. Globalization has led to large-scale technological advancements which

have contributed to reduced demand for unskilled labor. Also, foreign direct investors go for

highly skilled workers; hence there is the increase in unemployment. For most developing

nations rise in unemployment, lack of job opportunities and deterioration of wages are among the

adverse effects of globalization.

Globalization has another dimension, that is, globalization as a practice. Practice refers to

the application or use of an idea, belief or methods. Development of an international regulation

for minimum labor standards is a practical approach resulting from globalization. International

labor standards are practices that are stipulated by international actors, as a result of value acuity

aimed at protecting fundamental worker rights, improve employment terms, and enhance job

security for workers globally. The purpose of labor standardization is to initiate a worldwide

minimum extent of employee immunity from inhumane labor practices through global

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acquisition and implementation of the said initiative. Global labor standards have high potential

in improving working lives of significant numbers of people all over the world. The development

of an appropriate regulatory body for enforcing basic international standards could serve as a

model governing international economic activities more generally. Therefore, international

regulations on minimum labor standards are a practice that promotes globalization.

In summary, globalization has a positive impact worldwide. The process of globalization

has been influenced, over the years, by development in different fields. Globalization has

promoted increased trade and exchange of goods and services at a global level which has helped

many states to obtain what they do not produce and export what they produce in plenty. As a

result, goods are availed in plenty and at a considerably lower price. Globalization could take

three dimensions, in that; it can be considered as a process, a project, and as a practice.

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References

Chaudhury, S. K., Sarkar, S., &Panigrahi, A. K. (2014). Foreign Direct Investment (FDI). New

Delhi: Avon Publications.

Clark, C., & Clark, E. A. (2016). Challenging Neoliberalism: Globalization and the Economic

Miracles in Chile and Taiwan.

In Navarro, V. (2007). Neoliberalism, Globalization, and Inequalities: Consequences for Health

and Quality of Life. Amityville, NY: Baywood.

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