Menu Close

Advantages and disadvantages of globalisation

Advantages and disadvantages of globalisation

This article aims to identify and explain some of the advantages and disadvantages of globalisation. Globalisation is an important concept in today’s world. According to Hill (2013) globalisation is the shift toward a more integrated and interdependent world economy. There is no doubt that the world is rapidly moving toward an interconnected economic system. However, it is worth mentioning that globalisation is not without some pitfalls. While most people around the world support it, there are many who question its ‘charisma’ as well. Therefore, it is important to examine the pros and cons of globalisation before drawing any conclusions.

Advantages of globalisation (Benefits of globalisation)

Let us imagine a pair of jeans in an American fashion retailer with a ‘made in Bangladesh’, ‘made in China’ or ‘made in Turkey’ tag inside.  Let us also visualise Indians enjoying burgers of McDonald’s in India. How does it look like when we see people being very emotional having watched one of the most successful Hollywood movies ever in history, Titanic? These examples demonstrate the power of globalisation. People around the world have similar needs and desires which encourage companies to make their products and services available where people are!

Many people believe that globalisation has the potential to make the world a better and more just place. Interacting with people from different parts of the world provides everyone with an opportunity to understand different cultures. It also helps them understand human problems from different perspectives. By collaborating and sharing resources, countries can solve problems that affect people around the world.

Trading with different countries help businesses increase demand for their products and services and explore better supply chains. It is therefore not surprising to see that many companies such as Walmart, Gap, Primark, Zara, H&M, and J.C. Penney produce their merchandise in Bangladesh. In fact, many fashion retailers produce their merchandise in countries such as Bangladesh, Pakistan, India, China, Turkey, and Mexico.

One of the biggest benefits of globalisation is speedy travel and less restriction on human movement. This is useful for companies as they can hire talent from a large pool of applicants. Likewise, globalisation has helped many businesses keep their operations open 24/7. For instance, while a business day is over in the UK, a new business day begins in other parts of the world.

As multinational companies are operating around the world, they face fierce competition constantly. This pushes them often to reduce the prices of their products and services, which ultimately results in customers paying less. This also forces companies to develop and use cutting-edge technologies to stay ahead of competition.

Disadvantages of globalisation (Challenges of globalisation)

Poor and developing countries often find it difficult to compete with developed countries due to their lack of technology, knowledge, skilled labour, and other factors. Therefore, many analysts argue that globalisation benefits developed nations more than developing ones.

Due to globalisation, many multinationals spread their operations at optimal locations around the world. This helps them reduce costs of production; however, this also leads to job losses in home country. Likewise, they also sometimes try to justify lower wages at home.

Free movement of people may be a cause of transfer of contagious diseases. Likewise, globalisation is often accused of causing brain drain.  Brain drain refers to the situation in which large numbers of educated and very skilled people leave their own country to live and work in another one where pay and conditions are better (Cambridge Dictionary, 2020). It is often seen that developing nations struggle to keep their skilled workers at home who are attracted by better and higher incentives elsewhere.

 Many environmental activists and analysts  argue that globalisation impacts on environment badly. Globalisation promotes consumption of goods which necessitates transportation of raw materials and end products from one place to another. This contributes to noise, air, and water pollution.

We hope the article ‘Advantages and disadvantages of globalisation’ has been helpful. You may also like reading What are the driving forces behind globalisation and Advantages and disadvantages of franchising. Other relevant articles for you are:

Types of economic systems

PESTEL analysis of the USA

If you liked any of these articles, please feel free to share with others by clicking on the icons below. Also enter your email address at the bottom of the site to ‘Join us’ free for our newly published articles and newsletters.

Last update: 02 September 2020

References/Further reading:

Cambridge Dictionary (2020) Brain Drain, available at: (accessed 01 September 2020)

Hill, C. (2012) International Business: Competing in the Global Marketplace, 9th edition, New York: Mc Graw-Hill.

Photo credit: Pixabay

Author: M Rahman

M Rahman writes extensively online and offline with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University.

Related Posts