Customers – The user of financial services are benefiting from the competition in the financial services industry. The other cultural forms like movies, music and art are also affected by globalization. Where in some countries it is intensively used, in some countries financial services are still the in the infant stage. This helped companies to operate easily in many countries, as they could change the currency as per their choice to get it out of the country. Study for free with our range of university lectures! Increased production means more natural resources are used and this can be used up before they are regenerated leading to a negative impact on the environment. It shows the depth of globalization in financial services industry. Negative Effects of globalization on industries: 1. In these zones companies where given tax shops and subsidized facilities with the condition to export the maximum production form these units. The study of globalization and its impact to global economy and governance is one of such areas of expansion. This will have one of the biggest impacts on globalisation of business. This is also true in reverse. The member countries who signed on the trade agreements were forced to reduce trade barriers in stages. Spread of Culture – Globalization has also affected culture! Globalization is a widely used term in different contexts. You can view samples of our professional work here. Yip calls these factors, drivers of globalization and divides them into four categories. It depends on the countries, how much and for what, they are dependent on one-another. Now, movies are launched worldwide, which leave an impression on people and culture (Kulkarni, 2009). The factors which drive competition level are the following (Campell et al., 2004): Interdependence – Every industry has some links in other countries in one way or other. A global company or an industry need to satisfy some important characteristics for it. The reasons behind are the development of the software and the innovation of the new financial product and services (Campell et.al., 2004). Today one can go around the world for best learning and training facilities. Financial services can’t be possible without a proper transaction system around the world, as different countries have different currencies. But, for the poor and developing countries negative effects seems very large (Future-econ, 2009). Definitely globalization is one of the reasons behind this growth. If one is interested in the subject that is not available in the country, one can go to the country for learning that indigenous subject and spread the knowledge in one’s home country. This is not an example of the work produced by our Essay Writing Service. Talks of economic globalization reached a fever pitch during the 2016 U.S. presidential election, and everyone seems to have an opinion on it. Govt. What is more, this article highlights both negative and positive globalization effects which take place in developed countries as well as those which are just developing. The effects of globalization can be felt in practically every aspect of our lives today. Financial services industry is more open than ever before. For others, the term has a negative meaning, and critics see it as marginalizing less-dominant cultures, particularly those in the developing world. She has worked in accounting for such corporations as First Data, MCI and Verizon. Many home companies were not able to compete with these multinational companies, so they have to close their business. Through the free exchange of ideas, information, and innovation, today’s technology becomes obsolete … Most economists argue that the positive effects of globalization are more than the negative effects (Future-econ, 2009). Globalization provided score to these large companies to operate with full capacity, which helped them to reduce cost further (Rugman, 2002). Company Registration No: 4964706. Globalization has helped to remove poverty form the developing countries, in 1980 – 2001 people living on $1 or less than that per day has come down 1.1 billion from 1.5 billion (Burande, 2007). The business world has thus learned to be aware of technological changes that can affect their productivity and also positively or negatively impact their very survival. It’s not the developing countries who has benefited from globalization, developed economies have also enjoyed the fruits of globalization. Global compression reminds the dependency and system theories’ arguments. Yip in his framework explains the factors behind the globalization of business. Earlier when where no such health facilities were available people used to consume homeopathic medicines but now on one side where the health facilities have improved a lot the fear of fast spread of transmittable diseases have also increase (Lane, 2006). Globalization has brought benefits in developed countries as well as negative effects. The developing countries are always taken advantage of by the developed countries. Copyright 2020 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. Actions which would seem to … By this people moved from one job to another easily. There are growing numbers of consumers who actively seek products that are Fair Trade or otherwise certified as free from exploitative or unethical practices. Globalization has also forced world economies to free financial market. Because in the construction industry, there is some standard code of conduct which are being adopted by Bangladeshi construction firms. No plagiarism, guaranteed! It is also helpful to understand markets’ or industries’ different aspects. Impact – Third World In analyzing the impact of globalization in 2006, the World Bank found that the richest one-fifth of the world’s population possesses about 80 per cent of the world’s income, while the poorest one-fifth in the Third World owns a mere 1 per cent of global income. Some countries set-up special economy zones for giving extra boost to export (Rugman, 2002). Removal of Protection Competitive markets reduce monopoly profits and incentivise businesses to seek cost-reducing innovations . Because of that the unskilled employees lost their jobs. 2. Smith studied international relations at Colorado University in Boulder and received a Bachelor of Science in business administration from Colorado Christian University. Wide Operation Field – Globalization widens the operation field of a country, the people of a global economy can operates in many countries, thus it opens door of opportunities to increase their market size and profit. By globalization financial services industries have the potential to reduce cost. When people enters into a new environment he may faces several types of health problems, because of change in environment. Negative Effects Of Globalization On Business. Use of information technology and plastic money has played a significant role in the globalization financial services industry. There are several examples where people learnt the subject from other countries and earned name in their own country (Kulkarni, 2009). Outsourcing work that was an internal function may help minimize company expenses. can also access new technology by agreement with large groups after negotiation for their operations in their countries. Power reallocation … Globalization has led to increased production for businesses in order to meet global demand. The dependency of any country for other country can have both type of effect negative and positive. There are reasons on the world level to drive this industry towards globalization (Smith, 2002): Scale of economies – There are certain constraints for every industry to expend market. Negative Effects of Globalization to Environmental Damage: Negative effects of globalization have led to an increase in production to meet global demands, resulting in the exploitation of natural resources, having a negative impact on the environment. Global warming is also a part of global economies. For example, wages and manufacturing costs are lower in India and China, making countries like US and UK to outsource cheaper labor. Causes E nvir onmental D amage. 1. It is possible to study online and achieve a degree without having to relocate to a foreign state. Traditional labour intensive technologies were based on low power and machines, so the pollution was not an issue from those industries. It’s very difficult to explain all the positive effect of globalization on culture, human mindset, trade, employment, capital market and on the other fields. Figure 1 shows all these drivers of globalization. Globalization has both positive and negative effects. Globalization is most often used in an economic context, but it also affects and is affected by politics and culture. Where globalization has some positive effect, it does have negative effect. Financial services industry is globalized to some extent, but the restrictions on the flow of money from one country to another limits its globalization. There are many companies to serve the market for financial services for different needs, but no single company has the dominance in the financial services industry (Globaledge, 2010a). Competition also forces industries to go global In search of new markets for their products. The member countries of WTO opened their economy for increase world trade and free market. But, foreign exchange made it possible and that is also due to globalization when countries find it difficult to do transaction in Gold. All these points clearly indicate the negative and positive effects of globalization. Now, every single consumer can reach into their pocket, pull out their smartphone, and access the products or services you are … Their needs may vary in term of frequency and quality, but have same kind of requirements. Benefits / Gains from Globalisation. In the present time else than some restrictions on currency transfer financial services are freely available around the world . All work is written to order. 8 Ways to Fight Globalization's Negative Impact on Your Job Search In an increasingly globalized world, how can you put yourself in the front running for the top positions? Yip’s framework on globalization driver is very useful for analysing the level of globalization in an industry (Yip, 2003). Many people accepted globalization as a vague concept and don’t try to define it precisely. For instance, in countries where the environmental rules are not strict, the developed … Some of the positive effects are following; Free Capital Market – With the introduction of globalization countries opened their capital market. Today the culture, in which we live, is the contribution of many cultures. Many jobs performed in emerging countries for less cause a decrease in the wages offered in developing countries. Globalisation has thus made businesses walk on a razor’s edge in order to maintain their foothold in the fiercely competitive global market (Archibugia & Iammarino, 1999). But, for the poor and developing countries negative effects seems very large (Future-econ, 2009). Due to globalization, most global economy jobs are insecure and temporary. 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