What is globalization, drivers of globalization, effects of globalization.

Essay by jrisherUniversity, Bachelor'sA-, May 2009

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Globalization:The following will elaborate on globalization, and some theories on traditional trade. AlsoGlobalization as defined by Charles Hill, of the University of Washington"… refers to the shift toward a more integrated and interdependent world economy. Globalization has several facets, including the globalization of markets and the globalization of production". Free trade is an example of a situation where government makes no attempt to influence what its citizens can buy from other countries. Under the free trade system Smith, 2009 argued that "…the in visible hand of the market mechanism, rather then government policy, should determine what a country imports and what it exports".

When looking at globalization there are two major factors. The first is the decline in barriers that could have impeded the free flow of goods, services, and capital. This decline in barriers has been on going since the end of World War II. The second factor is the changes in technology.

Technology has in recent years has allowed dramatic developments in communication, information processing, and an easy in transportation, that past businesses did not have. (Hill, 2009)One example of a declining barrier to international trade that occurred after World War II was the General Agreement on Tariffs and Trade (GATT). The goal of GATT was to remove the barriers to the free flow of goods, services, and capital between nations. Through eight rounds of negotiations among members of state this was accomplished. From GATT the World Trade Organization (WTO) was also founded. The WTO was established to police the international trading system. (Hill, 2009)"The lowering of trade barriers made globalization of markets and production a theoretical possibility" (Hill, 2009). Since the end of World War II the gains of technology have exploded. The world has seen major advances in communication, information processing, and transportation technology. Telecommunication...