According to Thomas Friedman, “In Globalization 1.0, which began around 1492, the world went from size large to size medium. In Globalization 2.0, the era that introduced us to multinational companies, it went from size medium to size small. And then around 2000 came Globalization 3.0, in which the world went from being small to tiny.” It is not something one can pin point and define as a formal structure of the current international system. Globalization is a notion of the growing interconnectedness of the world categorized into three forms, cultural, political and economical globalization. Much like the quote by Thomas Friedman, globalization gives the conviction of the world being continually smaller and the pace of interaction ever faster.
Visualizing globalization as an action that leads to an ever-growing interconnectedness of goods, services, capital, information, ideas and people indicates both an expansion of interconnections between borders and the comprehension of the importance of those ties. A wider range of people and countries feel the effects of policy or event changes than before. The impacts of things are spread worldwide instead of the impact remaining in that particular region. Issues are now more interrelated than ever before and have broader implications.
Economic globalization is distinct national economies becoming one global economy. Global financial markets, international trade, transnational production and global division of labor define globalization of the economy. If you look at your clothes, cell phone or handbag, they were all produced in more than one country and traded worldwide. My iPhone for instance was designed in California but manufactured in China. Rich countries specialize in high-tech products while the poor countries are now left to mass-produce those products abandoning their once agricultural economy.
The constant contact between the interconnected economies often makes it as inexpensive to do business with foreign companies compared to internal businesses This helps create more market and more product diversity globally however; it also minimizes the advantage of the domestic businesses. The financial markets that were once its own distinct national markets are now a global financial market. When a state, much like the U.S is having an economic crisis, it becomes a global problem. The interconnected economy based on globalization leads one economy to rely on another and so forth. It stems from being just one states problem, to becoming everyone’s problem
The rapid growth of economic integration was due to the reduction of policy barriers that were hindering international trade and investment. International trade since the GATT, renamed WTO, has led to free trade. We in the US, experience the luxury of bananas cultivated in South America, tea from India and China, corn from Mexico and many other countries through international trade....