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Globalisation Advantage and Disadvantages - Economic Transition In India

   Posted On :  04.05.2018 04:56 am

Globalisation Advantage and Disadvantages - Economic Transition In India

Benefits



The important arguments in favour of globalisation are:


  •   Productivity grows more quickly when countries produce goods and services in which they have comparative advantage.
  •   Living standards can go up faster.
  •   Global competition and imports keep a lid on prices, so inflation is less likely to derail economic growth.
  •   An open economy spurs innovation with fresh ideas from abroad.
  •   Export jobs often pay more than other jobs.
  •   Unfettered capital flows give access to foreign investment and keep interest rates low.

Disadvantages



Following are the cases against globalisation:


  •   Millions have lost jobs due to imports or production shifts abroad. Most find new jobs that pay less.
  •   Millions of others fear loosing their jobs, especially at those companies operating under competitive pressure.
  •   Workers face pay cut demands from employers, which often threaten to export jobs.
  •   Services and white-collar jobs are increasingly vulnerable to operations moving offshore.
  •         Employees can lose their comparative advantage when companies build advanced factories in low-wage countries, making them as productive as those at home.
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