Definition

Globalization
means
the
growing
economic interdependence of countries
worldwide through increasing volume
and variety of cross border transaction
in goods and services and of
international capital flows and also
through the more rapid and widespread
diffusion of technology.

Features of globalization
There is reduction in trade barriers resulting
in free flow of goods across national border.
Companies plan and organize their business
at the global level.
There is free flow of capital, technology and
factors of production among different
nations, business in one country can
acquire these factors from another country.
Companies operating globally make no
distinction between domestic and foreign
market they develop a global outlook of
business.

 Business houses locate production and

distribution facilities in most profitable
countries. they are not guided by national
priorities.
Organization structure of business has a
global orientation.
It
deal
with
both
goods
and
services( banking, insurance, transport)
Companies have global consumer. Product
may be designed in one country, produced
in another and sold in yet another country.
Companies doing global business are
known as multinational or transnational
corporation.

benefit
World development
Access to new market and new technology
Replacement of import substitution by export
promotion.
Integration of economies.
Labour abundance benfit.
Economic Interdependence among different
nations can build improved political and social
links.
Globalisation promotes specialisation. Countries
can begin to specialise in those products they are
best at making.
Creates competition for local firms and thus keeps
costs down.
much wider choice of goods and services By
buying products from other nations

Limitation

Discriminatory flow of capital.

Inappropriate transfer of tecnnology
Blow to handicraft
Take over
Competition with domestic firm.
Cheap imports from developing nations could
lead to unemployment in developed countries
where the cost of production is high.
Choosing to specialize in certain products
may lead to unemployment in other sectors
which are not prioritized.
Dumping of goods by certain countries at
below cost price may harm industries in order
countries