Question

Please read the following:

The merits of globalization, it can lower cost of product and spread jobs throughout the world. Doing so can bring money to poorer regions of the world, empowering them with job opportunities. With the potential to improve the economics and quality of life in certain regions.

The pitfalls, Less people own and control more of the world than in history. Which means more money in the pockets of less and less people. This can hurt local economies by out sourcing jobs to different regions of the world where workers are cheaper. like the automotive and tech industries, auto out sourced to places like mexico, due to cheaper labor compared to the cost for american works in Detroit. Another possibility is a factory moving to a poor country, becoming the only employer in an area. This means everyone would be locked into working for the factory. which a lot of times uses harsh working conditions and minimal pay to preserve profits for those at the top. Nike is a perfect example of this.

In addition to Nike, find an example of another company and explain.

Answer 1

Other example would be of Textile company lie Zara which is manufacturing most of its product in South Asian country like Bangladesh which source most of the raw material (cotton) from the nearby nations and manufacture mostly out of Bangladesh where the labor is in abundance and is cheap leading to competitive advantage for the firm. Textile manufacturing has tremendously boosted the Per capital income and GDP of Bangladesh leading it to become one of the fastest growing nation in th world. The migration is leading to loss of jobs in the developed region and leading to high margins for companies like Zara with benefits to Bangladeshi economy in general. Although there lies several laws enacted by Bangladeshi govt to protect employees from exploitation but there has been some bad examples especially where the manufacturing is outsourced to local vendor where there are grave concern s with regards to working environment for the labors.