Que : 216. What is Globalization ?

Answer:

Globalisation : When all countries of the world adopt policy of liberalisation and as a result of which all the markets of the world are unified. It is called globalisation.

Factors inspiring globalisation :

1. Expansion of technical knowledge: During last 50 years the technical knowledge has developed rapidly. Telecommunication facilities such as, Internet, mobile phone, fax etc. has made the task of connecting people with each other throughout the world very easy. Communication satellite has brought a revolutionary change by expanding these facilities. As a result globalisations has expanded rapidly.

2. Process of liberalisation : During the decades of 1970 and 1990 some such changes took place due to which began the process of liberalising foreign trade. Several countries agreed to liberalise the world trade. This strengthen the process of liberalization. After the establishment of the World Trade Organisation in 1955, almost all the countries of the world have reduced their taxes on imports and have opened the markets of their countries for other countries.

3. Expansion of competition and market : During last few years the demand for goods and services has increased due to the increase in the income of consumers, changes in mentality, interest and habits of the consumers. The quality and types of the production are also improved due to the development of technology. Thereby the production of new-goods has become possible due to which markets have expanded.

4. Expansion of multinational companies : Multinational companies play a significant role in the linking the distant countries with each other. These companies set up their factories for production purpose in those countries where they get cheaper labour and other means of production.

5. Expansion of foreign trade : After the Second World War generally the foreign trade of all the countries has increased. The international institution like World Bank and International Monetary Fund have also contributed significantly in the expansion of trade. Due to this the producers have got an opportunity to sell their goods in the world market along with their domestic markets.