Answer to Question #268414 in Economics for Muhammad Ali

Question

What is meant by globalisation, and in what ways does it affect different countries

Answer 1

Globalization is the word used to describe the growing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information.

Globalization creates greater opportunities for firms in less industrialized countries to tap into more and larger markets around the world. Thus, businesses located in developing countries have more access to capital flows, technology, human capital, cheaper imports, and larger export markets.

On average, countries that globalized more, experienced higher growth rates. This is especially true for actual economic integration and – in developed countries – the absence of restrictions on trade and capital.