GLOBALIZATION

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Globalization
International Finance
Rhoni Mohanraj [111556]
17th March 2014
Brandon University

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GLOBALIZATION

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Introduction

Wayne Ellwood’s The No-Nonsense Guide to Globalization presents a clear and logical overview of the critical history of the economic globalization. Profit motivated multi-national corporations have the become the driving force of modern economic globalization. Colonizing the financial market of the world, the competitive nature of the corporations have generated a flawed and substandard model of globalization. Never the less with several modification, the notion of a global economic environment has a vast potential to increase the universal opulence of the world.
Although the modern concept of globalization is exceedingly centralized around the development and expansion of the international trade of goods and services, this notion is rooted in colonialism. As adequately put by economist Wayne Ellwood, “globalization is new word which describes an old process, i.e the integration of the global economy that begin in earnest with the launch of the European colonial era 5 centuries ago. But the process has accelerated over the past 30 years with the explosion of computer technology, the dismantling of barriers to the movements of goods and capital, and expanding political and economic power of multinational corporations.
This essay will conclude stating Ellwood’s view on globalization and determine, if globalization actually works for the economy or, if it is just Capitalism under the skin of globalization. !

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Ellwood’s states that globalization is something that started 5 centuries ago, during the days of a young and adventurous discoverer, Christopher Columbus. Globalization, even then, started as an innocent process of cross-cultural exchange to a nasty scramble of wealth and power. Isn’t that what is happening right now, 450 years later? Didn’t that idea, of capturing the wealth and resources of other regions, to prosper one’s own country, lay the groundwork for today’s global economy? Yes.
The inner workings of globalization is controlled by the large corporate companies and there is clear evidence for that. But, looking at it from the outside, many people would not know to clearly define what it actually means. Around the world, people are employed in jobs that did not exist, 2 or 3 decades ago. They are able to provide the basic necessities for their families and able to make living out of it. How did it all start? It all goes back to the colonial period again.
Global trade expanded rapidly during the colonial period in the 1600s, as European powers sucked in raw materials from their newly acquired regions. As Ellwood states “Slaves and gold from Africa, sugar and rum from the Caribbean, coffee, meat and silver from Latin
America, tea and spices from Asia.” By 1860s and 1870s world trade was booming. By 1913, exports accounted for larger share of global production that they did in 1999.
Globalization started under the umbrella of tyranny, slavery, poverty and colonialism.
The only difference being, back then, the term globalization did not exist. Today, the perception people have towards globalization is, trade under the concept of “comparative advantage”, a theory developed by David Ricardo. The reality of it being, his assumptions no longer work in today’s high-tech world and the notion is, the only route to prosperity is export-led trade.

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Let’s have a closer look into how capitalism came into play during the 1930s. As WWII came to a close, in came, The Great Depression. US stock market crashed which caused shockwaves around the world. Nations turned inward and tried to pull themselves out of the economic depression, but without a system of global rules, there was no other larger logic than
adopting