The nature of globalization

AuthorAmos Avny
PositionOMNIDEV International, Israel
Pages149-156

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Introduction

The Globalization phenomenon invokes discussions and raises discourses in many countries few years ago. Some see it as another, updated and more sophisticated instrument of Capitalism in its way to dominate the world. Thus, those who are not capitalists, due of their perception or because of their limited resources, oppose and reject it. N. Hertz (2002) goes even further in her opinion that Globalization endangers Democracy. This paper does not take part in the ideological dispute. It accepts the Globalization as one of the major powers affecting world societies and economies and it tries to explain it construct, how it operates and how nations should act in order to maximize their benefit from it. After discussing major variable: employment in the Service Sector and involvement in world trade-increase of exports and imports.

The analysis indicates that countries with high percentage (75-80) of employment in the service sector and a fast growth of foreign trade fit best for the demanding conditions of Globalization. During the last ten years more then half of the 15 original EU members (8 out of 15) reached this target. The 12 new EU members still have a along way to go, but they should adopt this strategy in order to accelerate their economic growth.

A Globalization as part of the world change

Since the last decade of the 20th'Century the world is passing a process of transformation. Since the collapse of the Communist Regime investigates two the components participating in the Globalization phenomenon the author explores the last ten years occurrence in the EU. The study

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the socio-economic life of many nations changed. Fifty years of tremendous technological achievements and twenty years of expanding democracy enable the emergence of the Globalization.

In another paper Avny (2006) addresses the conceptual meaning of Globalization. Here it is suffice to note its dramatic effect on the world and Europe. Similarly to US the European economy, which in the past rested on manufacturing industry, is moving to become a service-oriented one. Thus, unemployment grows since many of the traditional big industries move to China and South East Asia. European governments should take seriously this issue and should look for satisfying solutions. Relaying on the EU, its policy and ruling will not suffice for providing workable solutions. Further, we discuss the nature of Globalization and offer some recommendations for the EU new members.

B The nature of the globalization

Globalization is among the noteworthy phenomena of the 20th Century's last quarter.

As such, it has a significant impact on both developed and Less Developed Countries (LDCs) economies. It came out and expanded due to the technological advancement, and the major advancement of the communication and transportation industries. These innovative measures enable the reallocation of manufacturing facilities to new countries and the transfer of industries from the traditional industrial nations to countries with low labor costs..

The Globalization, known also as the second industrial revolution, has a double effect on the industrial and non-industrial nations. At the short run it yields affluence and prosperity for most people in developed countries, but at the same time it causes the disappearance of many jobs in the manufacturing industries. At the long run, however, the Globalization forces the introduction of some social-economic reforms that affects and forces to reconstruct the retirement and welfare systems of many countries. For better understanding the effects of the Globalization it is necessary to address some of its major components:

1. A Global Reallocation of Industries

During the past twenty years more and more manufacturing industries moved from the traditional industrial nations to countries that have...

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