Globalization has transformed the world into one unified system through advancements in technology and communication systems. According to the IMF work by Masson (2001), globalisation can be defined as the increased integration of economies, reflected by increases in trade, capital, investment and migration flows. This phenomenon has brought about high economic growth (Dreher, 2003) and improved standard of living. It is thus deduced that globalisation will be able to serve as an effective tool to reduce poverty (Nissanke, Thorbecke, 2005). However, heated debate has arise concerning the unequal outcomes in economic gains created by globalization. Despite a decreasing amount of people living in poverty in China, poverty in areas outside China has increased (Stiglitz, 2006). Along with economic effects, it is also suggested that globalisation has resulted in a global identity where local cultures are homogenized and no longer unique (Friedman, 2007). This essay thus compares and contrasts both favourable and pernicious views on the effects of globalisation from two aspects: economic outcomes and cultures, and concludes that globalisation is more favourable than pernicious.
Economists generally have a positive outlook on the effects of globalisation on economy since deregulation and openness to trade will create more jobs for the people. Friedman's article on the globalized world (2007) supported this perspective as it showed how developing countries such as India have benefited from outsourcing, which is made possible by the interconnectedness of the world as a result of technology advancements. Many of United States services jobs, such as 24/7 Call Center, were outsourced to India which helps in creating job opportunities and building India's economy. Despite losing service jobs to India, US also benefitted from the increased demand of US goods from India's growing economy. However, Stiglitz (2006) argued that such benefits were not shared equally in some developing countries such as Africa as poverty continues to plague their countries. This was further supported by The Globalization Index (2007) where it was estimated that "the benefits of globalization rarely reach 68 percent of the population that lives in rural areas". While Stiglitz (2006) attributed the failure for benefits to reach some people to poor institutions and an unstable global financial system, he maintains that benefits of globalization could reach all as long as it is properly managed.
With information sharing made much easier by globalisation, the culture...