Blog Assignment 4: “What is the relation between economics and globalization?” by Sky Choi( CHOI HA NEUL)

Blog Assignment 4: “What is the relation between economics and globalization?”

by Sky Choi( CHOI HA NEUL)

1.Summary

Economic globalization means that political boundaries are opposed internationally. This trend began in Europe in the 15th century. Currently transnational enterprises are an important part of the development of economic globalization.

For example, TNC is a company that also operates in other countries around the world. Everybody knows that General Motors, Toyota are part of TNC. According to foreign direct investment statistics, which invest directly in foreign countries or make subsidiaries overseas, the international economy is quickly gaining popularity. It is an asset that is not evenly distributed that motivates the development of the TNC. This is called asset-oriented, and asset-oriented is how many TNCs use other countries' natural resources. But the source of human resources is also one of the assets affecting. The TNCs implement mergers and acquisitions(M&A) and strategic cooperation. They will work with local companies to advance into local markets in other countries or to expand their influence. Strategic alliances are a popular method in TNCs. This way only a part of the two companies and a certain part of the company work together to achieve their goals. They can compete and cooperate at the same time.

Company should have an organizational culture that is strongly influenced by the country's culture, customs, and consumer preferences. Because if they don't match, it's hard to survive. TNCs will also increase their chances of success if their subsidiaries in other countries are operated according to local culture. As time goes by, it is becoming difficult to separate countries. Thus, if a subsidiary is formed in another country, or strategic alliances or m&a are made, it is forced to change according to the culture of the local country.

2.What was interesting:

I think it should have an organizational culture that is strongly influenced by the country's culture, customs, and consumer preferences when a company enters another country for invest, M&A, and establishes a strategic partnership,

I also think that if a company try to form a strategic partnership between companies, they should clearly understand what their goals are. If don't understand each other's goals, they are dreaming about each other (同床異夢). That would lead to a rupture. There are many such cases in Korea too. TNCs will also increase their chances of success if their subsidiaries in other countries are operated according to local culture. I also agree that as time goes by, separation between countries is becoming difficult. However, I think it is an advantage to differentiate each company from each other, as culture dilutes and common factors increase.

3. Discussion 

“What is the relation between economics and globalization?”  

Globalization refers to the integration among societies and economies across the globe. The process of globalization ensures the integration individual national economies with the global economy.

 

Globalization has led to social, economic, technical, cultural and ecological interdependence among nations. Globalization has a major impact on the economic scenario of individual countries and the global economy as well. International economic relations have gained paramount importance in the era of globalization. International economic relations undertaken in the light of globalization have led to rapid development and decline in poverty in many developing countries like India and China. 

 

International economic relations play an important role in the growth of economies across the world. For economic relations between nations to be successful, a number of conditions need to be fulfilled. Unrestricted movement of goods and services, flow of capital, mobility of workforce, and reduction of regulatory obstacles need to be ensured for successful economic relations. 

 

Globalization has played an important role in fostering economic relations among nations across the world. In the era of globalization, countries have realized that economic co-operation with other nations is strategically important for the growth of the economy.

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If TNCs enter other countries and are depleting natural resources such as local natural resources and other resources, but are providing jobs and so on, how can they respond in an economic sense? What should we do if resources can be depleted someday and limited?