The definition of globalization according to (International Business, 2009) is to Trend away from distinct national economic units and toward one huge global market. This means that instead if just using resources from a business’s country of origin that business may use several countries to manufacture or provide a service to the rest of the world. Some of the traditional trade theories were that if a business uses or outsources its labor or materials it is only hurting the labor force in its own country. However, from history it shows that if only the country of origin is used it ...view middle of the document...
To start with the labor costs to make car parts in America the average pay is about nine dollars an hour when in Malaysia it would be about 75 cents an hour the same would be true in Mexico and other less developed countries. When looking at cost of manufacturing there is not only labor but also environmental regulations that are more on the business side, and even safety. When there are fewer rules to follow the manufacturing, process costs can be lowered because of fewer regulations to follow. Third is the 24-hour marketplace where some computer companies use places like India to outsource their customer support. Another is Microsoft who uses India as their night shift to debug programs while their engineers are sleeping.
Effects of globalization on the community where William Davidson is from are very evident from the selection of cell phones and low cost of each to how the global market affects the military and the rate of deployments. Because of the global economy, I have enough gas for my car, and it does not cost a year’s salary to put new tires on it not including that almost half of the car owned by William was made in a different country and only assembled the United States of America. Without globalization much of what is enjoyed in my community would not be there and many of this community would be farmers instead.
Hill, C. W. (2009). International Business (7th ed.). New York, NY: McGraw-Hill.