Globalization Theory And Its Impact On The World Trade

Introduction Globalization has been imperative for sustenance of the companies and countries across the spectrum. Growth of free trade has caused changes not only in one aspect. It has brought changes in all the endeavors of people across society. It has been said that globalization is the process of international integration that arises from interchange of world views or products or others aspects of culture (Alon, Jaffe, and Vianelli, 2013). It cannot be delineated to any one aspect. It has caused a number of positive growths across the countries and has caused improvement in the quality of life of the people. However this aspect of globalization is not perfect. There are some inherent gaps and vulnerability to this aspect of†¦show more content†¦It has been involved in the stretching of social, political and economical activities. It has improved telecommunication and travel and made it very easy to access people across the spectrum (Hirst, and Thompson, 2002.). Virtually all the peop le are interconnected and most of the businesses are dependent on the companies and supplied from another country for its survival. There has many facets to this globalization impact the real magnitude of impact of globalization is a staggering volume. It has caused a tremendous impact to the life of the people and the processes of business operation. In this particular analysis, globalization with respect to product and consumption alone has been discussed in detail. Categories of product consumption In the international arena and in the free trade zones there are three kinds of trade activities that are practiced by the countries. The first kind of product and trade exchange that occurs are in the primary level products that are procured from conventional businesses. These include agriculture, mining sector and other essential commodities (Salomon, 2016). In this system the product and the consumptions are influenced by the classic market mechanisms of the nation. Product prices are fixed in this sector. In the second category of product are the intermediate goods that are based on the reference prices. The process of these intermediate