Review of Globalization against protectionism

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Globalization and Protectionism

Globalization is the process that unimpeded movement of goods, services, and money across international borders. Economic, trade, financial, and communication systems and services are integrated as a result of globalization (Hill, Cronk & Wickramasekera, 2013).

Protectionism, on the other hand, refers to government-imposed measures that limit and inhibit international trade with the aim of protecting domestic firms and employment from foreign competition. Through the restriction of imports into a country, protectionism's primary goal is to increase the competitiveness of local industries and firms (Hill et al., 2013).

Benefits of Globalization

In my own opinion globalization is a better practice as opposed to protectionism because the benefits that come as a result of international trade outweigh any economic forecasts created by the government through protectionism. Both globalization and protectionism have their own advantages and disadvantages, but we cannot deny the influence globalization has had on global technological innovation (Hill et al., 2013). The absence of global trade would translate to failure in making the necessary advancements required to sustain businesses. Globalization also has a potential of solving deep-rooted problems in the world economy such as poverty and unemployment, therefore, making the world a better place.

Promoting Global Economic Growth

Globalization emphasizes on global trade which in turn promotes global economic growth through the creation of jobs, lowering of consumer prices and making companies more competitive (Hill et al., 2013). Protectionism uses restrictions such as tariffs to protect the local companies from foreign competitors which in turn leads to the development of competitive advantages. The competitive advantages translate to the growth of the domestic markets and industries which force them to embark on global trade to meet the growing supply and demand (Hill et al., 2013). This implies that eventually, the local companies will need to go global in order to remain relevant and competitive. Globalization is, therefore, a preferred practice as compared to protectionism especially with regard to the long-term success of local industries and markets.

Reference

Hill, C. W., Cronk, T., & Wickramasekera, R. (2013). Global business today. McGraw-Hill Education (Australia).

February 09, 2023
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Industry Entrepreneurship

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