Effects of globalization on economic growthGlobalization is ideal for economic growth through cooperation between countries with economic strength and those whose economies are still developing. It is seen as a way through which developing countries can do better economically. Telecommunication and widespread use of internet have contributed immensely to globalization. Barriers are broken to ensure free flow of capital, goods and technology. .
Some of the positive effects are increased markets, increased competition, spread of wealth and technological advancement. However, globalization has its disadvantages such as inequality, interdependence and dominance by few countries. There are both positive and negative impacts of globalization on economic growth.
Globalization has led to increased markets due to the easy flow of goods and capital within different regions. It has also enhanced distribution of wealth through payment of taxes and creation of employment. Increased competition helps to increase the quality of good and services. Producers have to ensure that their products march up to the expectations of the buyers. Technological advancement also comes in handy to improve the quantity and also the quality of products.
One of the negative impact of globalization is that there is a possibility of a country that has a superior economy could dominant other countries making them take advantage of other countries to benefit themselves. Also interdependence could lead to other countries depending on another country so much such that if the support is withdrawn one side would suffer. Inequality where the different countries have different economic strength Globalization is advantageous as much as there are disadvantages attached to it.
It has however been received well by various countries and policy makers since its positives outweigh the negatives.