Effect of globalization on local firms

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Running Head: EFFECT OF GLOBALIZATION ON LOCAL FIRMS

Effect of Globalization on Local Firms

University of California, Berkeley

Commerce

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EFFECT OF GLOBALIZATION ON LOCAL FIRMS 2

Effect of Globalization on Local Firms

Globalization is the process through which corporations or other organizations gain

worldwide clout or begin to operate on a global scale. Various authors have defined globalization

differently through time; Adan (2011) describes it as the integration of states via increased

interaction, communication, and commerce in order to develop a shared global culture for all

humankind. According to Nicholas (2004), globalization may be defined as the globalization of

commodities and capital markets in such a way that obstacles to international commerce and

political impediments to investment in other nations are removed. Many implications are

predicted in the local economy as a result of American President Trump's intention to pull down

on globalization in the United States. Yes, globalization is a solution to many problems, but it

also has drawbacks.

The first of these beneficial effects is the potential increase in the exports sector of local

industries. This would comprise heavy industrial businesses with export potential. They would

now have a broader market to trade in the outside world. As the country's population grows,

more residents are guaranteed of finding work, while firms receive larger exponential profit

margins as a result of the rising number.

The second factor is an increase in employment. This is owing to the enormous number

of vacancies that would exist in big scale firms as a result of the opening of a broader market

necessitating a greater supply, which the company may be unable to meet with its existing poor

human resource and productivity. This would result in equivalent economic development as a

consequence of expanded business possibilities attributable to greater value of products exported

and higher cash flow into the nation for items sold.

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Running Head: EFFECT OF GLOBALIZATION ON LOCAL FIRMS Effect of Globalization on Local Firms University of California, Berkeley Commerce EFFECT OF GLOBALIZATION ON LOCAL FIRMS 2 Effect of Globalization on Local Firms Globalization is the process through which corporations or other organizations gain worldwide clout or begin to operate on a global scale. Various authors have defined globalization differently through time; Adan (2011) describes it as the integration of states via increased interaction, communication, and commerce in order to develop a shared global culture for all humankind. According to Nicholas (2004), globalization may be defined as the globalization of commodities and capital markets in such a way that obstacles to international commerce and political impediments to investment in other nations are removed. Many implications are predicted in the local economy as a result of American President Trump's intention to pull down on globalization in the United States. Yes, globalization is a solution to many problems, but it also has drawbacks. The first of these beneficial effects is the potential increase in the exports sector of local industries. This would comprise heavy industrial businesses with export potential. They would now have a broader market to trade in the outside world. As the country's population grows, more residents are guaranteed of finding work, while firms receive larger exponential profit margins as a result of the rising number. The se ...
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