Globalization Questionnaire

Essay by crazy123College, UndergraduateA, April 2009

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Week One ~ Globalization Questionnaire

University of Phoenix

MGT 448~Global Business Strategies

March 9th, 2009



Globalization Questionnaire

What is globalization, and what are some of the traditional international trade theories that support the concept of globalization?

"Globalization refers to the shift toward a more integrated and interdependent world economy" (Hill, 2009, p.6). Globalization is the process in which economies of countries all around the world become integrated over a period of time leading to organizations having access to a wider market base and consumers having access to a larger variety of goods and services.

Carnegie Endowment for International Peace (2009), states that

Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world (para.1).

International trade occurs because of relative price differences between nations. The differences stem from variations in production costs which then result from the following four factors, 1- differences in the factors of production, 2-the differences in the levels of technology which determine the factor intensities used, 3- differences in the efficiencies with which these are utilized, and 4-foreign exchange rates (Ball & McCulloch, 1999). International trade theory shows that nations will attain a higher level of living by specializing in goods for which they possess a comparative advantage and importing those for which they have a comparative disadvantage.

List the major drivers of globalization and give three examples of each.

There are two factors that motivate globalization, the first is declining trade and investment barriers and...