Globalization: advantages and disadvantages

A question from Yahoo! Answers:

GLOBALIZATION – is it more of an advantage or a disadvantage?

The world as a whole wins from globalization. To undesrtand why, you need to go back to David Ricardo and his concept of comparative advantage. But it does not mean that globalization is a problem-free process. For one thing, gains and losses accrue to different people to a different degree. Typically, globalization gains accrue to large numbers of people in small ways (for example, a certain item that 200 million people all over the world buy every day now costs on average 80 cents instead of 90), while globalization losses are highly concentrated (say, 800 workers who used to manufacture that item in France lost their jobs because the item is available more cheaply from Ireland, Poland, or Bangladesh).

This entry was posted in Answers, Economics. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *