The Disadvantages of Globalization for the American Business

In: Business and Management

Submitted By GVEGA
Words 683
Pages 3
Globalization is the process by which markets integrate worldwide. Globalization has advantages and its disadvantages. Two years ago, U.S. GDP was growing at a healthy 3.6 percent clip and world GDP growth was somewhat higher, led by China and India. However, over the past couple of quarters, world GDP growth has turned more sluggish, affecting even India and China, while the U.S. economy has significantly slowed and looks like it's going to slow further.

Some may argue that buying cheaper products for Americans to buy is an advantage. That is due to the cheap labor that makes the product. The American workforce will have to compete with foreign workforces who are willing to work for less. By relocating some parts of international supply chains, globalization has been affecting the price of goods, job patterns, and wages almost everywhere. Over the past two years, unemployment inside the United States has risen from 4.6 to 6.1 percent. It is changing the structure of individual economies in ways that affect different groups within those countries differently. In the advanced economies, it is redistributing employment opportunities. As the richer get richer by investing in companies overseas, the poor get poorer, leading to financial problems. Countries like Mexico, Thailand, Indonesia or Brazil got a lot of money from investors who built up new businesses there.

Building products overseas globally puts our business technologies at risk of being copied or stolen, which is in fact happening very rapidly. China and other Asian countries already make most of our high volume commodity products, so America must compete by inventing new products, new technologies, and new industries. Because America has always led the world in new products and new technologies, other countries also see the demand and would want to take over the U.S. market. Their plan is to…...

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