Globalization refers to the interaction of the one economy to another. It allows free flow of trade and business to other countries without any barriers. Globalization has encouraged cross cultural awareness and a sense of global civics. This report will be describing the arguments regarding Ted Levitt’s predictions about the globalization of markets written in 1983. Four arguments will be elaborating in this report which will reflect the favor side of Levitt’s Prediction. The four journal articles will support the arguments which will show the relevancy in the support of argument.
It has been analyzed in the article of Levitt’s prediction about the globalization of market that global market is advanced in comparison of multinational products. There is difference between global and Multinational Corporation. Multinational corporation operations in a number of coultries and the cost of its products and services are high in comparison of others while the cost of products and services of global corporation at low and affordable level. As per Thompson, globalization has the benefits because it helps to enhance the wage rates and purchasing power in previously low income countries (Ezrow and Hellwig, 2014). It has been stated in the article of Thompson that due to globalization the earning power of poor people has been increased. They have become able to gain purchasing power and become efficient markets for the products that other manufacture efficiently. It has been mention in this article that when a country interact in international trade, the purchasing power of house hold will be raised. Income structure of them will be enhanced because they would be able to attain goods and services at lower cost. It would be more beneficial for the country because when country engage with another country’s trade it can be produce more gross domestic products from its labor, land and capital. If the country is to reap the advantages from globalization, it will enhance in both consumer purchasing power and potential GDP (Thompson, 2007).
It has been evaluated that the description about the globalization in the Levitt’s prediction is right because it can be seen in other article that the role of globalization in the progress of world is proved. As it mentioned in the Levitt’s prediction about the globalization of the market that globalization is able to raise the living standard s of people and along with that it is helpful to change the mind of people regarding international trade and enhance the fun while working. Alias, Abidin, Ping, Muhamad and Rahim stated in their journal article that the globalization is worthwhile in the emergence growth of economic globalization. The living standard of people has been improved by the growth of globalization because there are several reasons why this has occurred. They are relaxation of government controls, better transport along with communications, adaption of latest technology, mobility of investment and the promise of effective and useful material for better living standards. As it mentioned in Levitt’s article the benefit of globalization to all people’s living standard, it has been proved by the article of Globalization and its effect on world poverty and inequality. This article reflects the favor point with argument that due to globalization general relaxation of government has been converted in to forces of freer markets. It has been seen that the speed of transport and communication improved which meant that international trade has become aware about the opportunities of profit. New technology is involving in the development of international busines which enhances the level of education of everyone and forces them to get educated. Removal of tariff protection encourages the country to get specialization in particular area where they have a cost advantage in comparison of other countries (Alias, Abidin, Ping, Muhamad and Rahim, 2014).
It has been stated in Levitt’s article that Corporations sell standardized products in the same way everywhere. The main benefit of globalization is that every products sell in different country with same quality and it become easy to every country to consume products related to another country. It is the effort of globalization to push markets towards commonality of global. To the support of this description, The Effects of Globalization on Marketing by Naghi and Para, article has been taken which describing that there is lots of advantage of globalization. The advantage of making a unique brand name which is worldwide for the global company will be able to maintain its brand identity in all over the world. Standardizing operational marketing is able to generate the important economies of scale in a particular packaging and communication. It has been evaluated that globalised firms are centrally plan and able to produce the new products in worldwide within less than one year (Scriven, 2014). Globalization put efforts to sell the same thing in the same way everywhere so that no one could get deprived from consumption of things which has been manufactured by foreign country. “High-touch” products are as pervasive as high-tech. Corporations sell standardized products in the same way everywhere refers globalization has become able to sell products in a same manner in all over the world such as steel, agricultural, cement, petrol, transport, industrial and commercial construction, semiconductors, telecommunication, pharmaceuticals and many more are same for all over the world. It would become easy for the particular country to use product of other country and produce in own country (Ekberg and Lange, 2014).
Globalization is a beneficiary element for the world as per article Ted Levitt’s prediction about the globalization of markets. Cost structure of effective world competitors incorporate superior quality along with reliability. These competitors are selling out same kind of products and services not only at home but also in the wider export market. Their competition is basis on the best combination of reliability, cost, quality and delivery for commodities that are recognized by globally regarding to function, latest trend and function. It has been evaluated that one of the presentable effects of globalization is the quality and the reliability of the products is improved due to global competition. Market under the influence of globalization work on the approaches that is customer is the king which helps to produce improved quality and services (Dumitrescu and Vinerean, 2010). Due to that local market started to fight out with foreign competition, they are forced to raise their standards and the satisfaction of customers in order to live in the market appropriately. Along with that when an international brand invade in to new country, it brings good will along, which is necessary to live up to. This is the way which creates competition in the market. Competition is required for better quality and to survive in the market. Competition is not only found locally, it is the factor which can be finding in every level of area whether it is locally or globally. Due to global competition, each country has become able to adapt new technology rapidly and the information of new technology will enhance appropriately due to globalization (Contractor, 2013).
Alias, M, K, Abidin, Z, Z, Ping, S, D,S, Muhamad, A, I, and Rahim, H, L, 2014, Globalization and its effect on world poverty and inequality.
Dumitrescu, L, and Vinerean, S, 2010, The glocal strategy of global brands, Studies in Business and Economics, 5(3), pp.147-155.
Ekberg, E, and Lange, E, 2014, Business history and economic globalization, Business History, 56(1), pp.101-115.
Ezrow, L, and Hellwig, T, 2014, Responding to voters or responding to markets? Political parties and public opinion in an era of globalization, International Studies Quarterly, 58(4), pp.816-827.
Contractor, F., 2013, “Punching above their weight” The sources of competitive advantage for emerging market multinationals, International Journal of Emerging Markets, 8(4), pp.304-328.
Naghi, R, I, and Para, I, 2013, The Effects of Globalization on Marketing, GSTF Business Review (GBR), 2(3), p.168.
Scriven, J., 2014, The Impact of Globalization on the Consumer, The Nouman Business Review, pp.13-23.
Thompson, R, L, 2007, Globalization and the benefits of trade, Chicago Fed Letter”, The Federal Reserve Bank of Chicago, (236).