Globalisation

Globalisation

Introduction

Globalisation can be understood as a process, in which business activities are organised on a global scale. Company will have free economic operations across borders of countries, with minimum impediments from the governments.

“Globalization refers to global economic integration of many formerly national economies into one global economy, mainly by free trade and free capital mobility, but also by easy or uncontrolled migration. It is the effective erasure of national boundaries for economic purposes” (Herman 1999).

This report will have an overview of the case study which discuss for and against globalisation from a ‘Western’ and ‘Local’ perspectives on issues such as lower tax rates, lower input cost, child labor and slave labor wages.

Discussion

The case for Globalisation:-

From a ‘Western’ perspective, Multinational Corporation can setup or relocate their production plant to other developing countries which have lower cost such as labour, rental and direct material cost. Low rates of corporation tax are introduced by the local government to attract these companies (Tejvan 2012).

Due to lower cost of production, the prices for the goods produced can be cheaper and this will increase the volume of consumers thus increase the company revenue. With an open economy, innovation of new ideas arises along with different culture from the local country. Multinational Corporation are no longer restricted to production in own country as globalisation allow them to invest and broaden their business (Pavithira 2009).

From a ‘Local’ perspective, coming in of Multinational Corporation can improve the existence and survival of the locals and their families. Jobs are created to earn wages as a living and there is greater opportunity for the people to economically succeed and increase personal standard of living (Ajay n.d).When there are stable incomes to support the family, it minimise the chances of youth turning into prostitution...