Description
The debate on the advantages and disadvantages of 'Globalisation' has been going on for many years. Laymen and experts alike are divided whether the process will result in more or less welfare for humanity. Even though the benefits are obvious, especially for consumers, there seems to be much attendant pain. We often hear of plant closures or massive job- cuts because of foreign competition'. In addition, globalisation is associated with economic crises, environmental damage, erosion of sovereignty and cultural dilution. Moreover, opinions over the issue of globalisation can be very intense and emotional as manifested by the violent street demonstrations that regularly accompany WTO and IMF meetings. Unfortunately, the picture on the net benefit or loss as a consequence result of globalisation is as unclear as ever. As a result, policy-makers are unsure whether the process needs to be encouraged or curtailed.
In this book, the author argues that the process of globalisation as an economic phenomenon is not a new thing. It has in fact been going on for thousands of years. Moreover, the process has generated tremendous benefits for humanity. Through international trading activities, our forefathers have been able to enjoy varieties of goods from different parts of the world at the lowest price.
However, the picture changes drastically with the rise of a recent phenomenon called 'hyper-competition'. Firms all over the globe are now forced to compete fiercely in order to ensure their own survival. Overseas markets need to be penetrated to increase revenues whilst domestic markets need to be defended from foreign competition. Underlying the process is the lending-for-profit industry or more commonly known as the Finance' industry. The author explains in detail how this relatively new industry is the force which has been building up firms into becoming bigger and fiercer competitors. Besides operating on a large scale, highly leveraged firms are also pursuing strategies which emphasise rapid and expensive innovations. As a result, they become even more indebted. This intensifies already fierce competition to the point where losing can be so devastating it often entails massive job losses and bankruptcies.
The author also explains how the finance industry has been the factor that causes nations to become highly indebted and thereby severely exposed to external shocks. The resulting negative outcomes have often been wrongly attributed to the process of globalisation' rather than to the powerful effects of the operations of the lending-for-profit industry. ISBN:9789831004012
