This post intends to provide you with a list of quality MBA thesis topics and how to structure your own MBA thesis. Move universities differ when it comes to writing a thesis, this includes referencing style and word count. The MBA thesis structure below will provide useful when structuring your MBA thesis, I have used the below structure on a couple of occasions and benefited from it.
MBA Thesis Structure – Essential Components
Writing a dissertation introduction is perceived as a relatively straightforward aspect of the dissertation writing process. The reason for this may be that we often find typical components in an introduction that we can use, regardless of the study we are writing. One of the challenges of writing a good introduction, however, is to be brief, and to stay focused – This will help you with to write the best MBA thesis topics.
An incoherent or unfocused introduction, or one that is over-lengthy, may detract from the overall grade of the dissertation and will not create a good impression on the reader(s). Be mindful that you should avoid being anecdotal in your introduction (i.e. writing as if you are telling a story) and you will also need to avoid wasting words by stating the obvious and writing a series of over-generalized statements.
a clear statement of your MBA thesis aims and objectives;
the problems to be solved to reach your objectives, and initial ideas on how to solve them;
you may also indicate a gap in knowledge, if applicable
research questions – if a research project
Unearthing new theories don’t materialise easily out of nowhere; they build upon the findings of previous academic research and explorations. A literature review illustrates how the academic investigation you are conducting fits with what has been written before and puts it into perspective. A literature review demonstrates to your reader that you are able to:
• Understand and critically analyse the background research • Select and source the information that is necessary to develop a context for your research • Shows how your investigation relates to previous research • Reveals the contribution that your investigation makes to this field • Provides evidence that may help explain your findings later
If you are doing a dissertation, or significant assignment it is likely that you will need to include a literature review. If you are doing a lab write-up or a shorter report, some background reading may be required to give context to your work, but this is usually included as an analysis in the introduction and discussion sections.
What is a literature review?A literature review is an analysis of existing research which is relevant to your research topic, demonstrating how it relates to your investigation. It explains and justifies how your investigation may help answer some of the questions or gaps in this area of research.
A literature review is not a straightforward summary of everything you have read on the topic and it is not a chronological description of what was discovered in your field. A longer literature review may have headings to help group the relevant research into themes or topics. This gives a focus to your analysis, as you can group similar studies together and compare and contrast their approaches, any weaknesses or strengths in their methods, and their findings.
One common way to approach a literature review is to start out broad and then become more specific. Think of it as an inverted triangle. (1) First briefly explain the broad issues related to your investigation; you don’t need to write much about this, just demonstrate that you are aware of the breadth of your subject (2) Then narrow your focus to deal with the studies that overlap with your research. (3) Finally, hone in on any research which is directly related to your specific investigation.
Proportionally you spend most time discussing those studies which have most direct relevance to your research. How do I get started? Start by identifying what you will need to know to inform your research:
What research has already been done on this topic?What are the sub-areas of the topic you need to explore?
What other research (perhaps not directly on the topic) might be relevant to your investigation?
How do these sub-topics and other research overlap with your investigation?
A discussion of the technical literature you have read, explaining why it is relevant for your project critical analysis, e.g. strength, applicability and weakness
Identify any knowledge/research gap and how you may address this gap, if applicable
Note down all your initial thoughts on the topic. You can use a list to help you identify the areas you want to investigate further. It is important to do this before you start reading so that you don’t waste time on unfocused and irrelevant reading.
Searching for sources It’s easy to think that the best way to search for texts is to use the Internet – to ‘Google it’. There are useful online tools that you may use, like Google Scholar. However, for most literature reviews you will need to focus on academically authoritative texts like academic books, journals, research reports, government publications. Searching Google will give you thousands of hits, few of them authoritative, and you will waste time sorting through them. A better idea is to use databases. These are available through the Library in paper and electronic (usually online) forms.
Requirements – MBA Thesis Topics
User requirements for the target system, if applicable; or
Requirements to achieve the success of your project
Evaluation of your proposed system (if building a software system); or
evaluation of your research project, including e.g.
quality of data used: e.g. reliability, coverage/completeness
quality of data collection method, e.g. limitations of sampling methods
quality of analytical methods used, e.g., any limitations? Any bias?
quality of conclusions drawn, e.g. are they affected by potential bias of input data due to methods used, incompleteness of data, etc.
quality of presentations, e.g. which visualisations used to view complex data – what diagrams have been used, are they suitable?
quality of tools used, e.g. are they appropriate? Have you encountered any problems, if so, how did you overcame them?
initial design of software or design of experiments, if applicable; or
methodology for carrying out your research project, inc. where/how you plan to source your data, how you plan to group them, what methods you plan to deploy for analysis,
you can draw a methodology diagram for this.
Questionnaire, if any.
Timetable and work plan for the whole year, agreed with your supervisor, and specifying activities, deliverable and deadlines. See an example timetable here: project management information:
Make sure that you have clearly labelled your time allocation on evaluation and how you will meet the deadlines, etc.
Risk analysis and remedies/management
Appendix (as needed)
An appendix (plural is “appendices”) is a section added to the end of your dissertation. It includes material that expands and explains the subject matter you have discussed in earlier sections. Each appendix should cover a distinct aspect of your subject. Follow the steps below and you will learn how to write an appendix and its importance to your writing. This is essential for MBA thesis topics.
Blank consensus form (if interview/survey are to be conducted)
Blank questionnaire (if interview/survey are to be conducted)
Data tables or diagrams (if appropriate)
Copy of questionnaire or survey
Copies of personal correspondence
Transcripts of interviews
Illustrations or photographs
Explanation of technical information or formulas
And that’s it, everything you need to include. As with everything, it’s a good idea to check with your dissertation supervisor before handing in as they’re the authority on how your University wants your dissertation. Remember, it’s the starting that’s the hard part, once you’ve sat down and committed the time, it should come quite easily.
MBA Thesis Topics Notes
Always check the marking sheet/rubric and make sure that you have meet all of the required work. Also make sure that you observe the percentage allocation for each of the categories and that you have provided sufficient to meet the percentage.
The above is the minimum set of requirements. If you have done more than what is suggested here, for instance a preliminary implementation or tests of existing software tools, by all means report it.
Make sure you do not exceed the maximum pages allowed. If you have useful graphs and data, you can include them in appendix.
Make sure you run spell checker to make sure there is no spelling errors.
Thanks for taking the time out to read this MBA thesis topics blog post and I hope you found it useful. I would be grateful if you could share this blog post via Twitter, Facebook, or Google+ I would like to generate as much social media buzz around this post.
Globalization is a phenomenon that has swept across most sectors of the globe leaving firms to adjust to the changes that are occurring. The rise of competition Is one example of an aspect that has emerged within the twenty-first century, especially due to a dissolution in trade barrier that marked numerous markets as impenetrable. With globalization escalating gradually, businesses have gained an exposure opportunity to learn more as well as share tips on better ways of approaching futuristic growth. The following report will expound on globalization as a phenomenon, as well as its associated impacts within the modern day era.
From an entrepreneurship perspective, the duties and functions that defined the modern-day capitalist or businessperson, have significantly complicated with time. Ideally, the 21st century, unlike its predecessors, has been defined by a revolutionary economic, educational, political, and social landscapes, elements that have emerged as a result of globalization.
Interestingly, the emergence of the phenomenon has transformed the manner in which man does business, given that it has erased the limitations that were nurtured by geographical borders as well as trade barriers, an aspect that has resulted in man embracing new synergies that will offer him or her competitive advantage over other similar players in the same market niche. The following report will further expand on wise investment moves as well as tactics such as outsourcing and offshoring that managers can apply to realize a wider economy of scale as well as achieve a greater competitive advantage. By utilizing the Case study of Telstra Call center services Outsourcing and offshoring, this report will expound on the impact, opportunities, as well as challenges, Globalization, and its associated strategies, have imposed on business operations especially on the global scale.
The World as we know it is currently evolving at unprecedented levels, an aspect that is reconfiguring and transforming the manner in which business, as well as trade, is conducted. As a result of the rampant transformation, goods and services have become easily accessible for most people across diverse regions of the globe. In addition to this, the international business community has continuously expanded as a result of favorable influences that have been nurtured by the economic reconfiguration and transformation. But, what is all this economic reconfiguration and transformation? The 21st century, unlike its predecessors, has been defined by a revolutionary economic, educational, political, and social landscapes, elements that have emerged as a result of globalization. The emergence of globalization as a phenomenon has transformed the manner in which man does business, given that it has erased the limitations that were nurtured by geographical borders as well as trade barriers (Beck, U. 2018, P. 35).
From an entrepreneurship perspective, the duties and functions that defined the modern-day capitalist or businessperson, have significantly complicated with time. Why and How? With factors such as competition escalating as a result of the globalization aspect, most entrepreneurs have embarked on redefining the rules of trade and business engagement provoked by the need to craft and embrace new synergies that will offer them competitive advantage over other similar players in the same market niche (Hay, C. and Marsh, D. eds. 2016, p. 52). As a result of the shift in momentum, it is crucial to note that today’s economic environment has shifted its dependency from the public sector to the public sector, given that the later has emerged to be the global powerhouse, while the former segment has continuously shrunk in size, cumulatively losing its prior influence and relevance in the economy setting.
Globalization and Expansion
In spite of Globalization nurturing numerous advantages from an economic growth perspective, it is crucial to note that the phenomenon has also escalated the rate of competition present across all trade sectors. The given aspect has manifested as a result of numerous entities across diverse regions entering the market, with each unit producing a similar commodity, to an already existing product. The escalation of competition has provoked most organizations to invest heavily in expanding their operations onto a global scale, efforts that have emerged based on the need to grow and expand the market niche that each organization claims and controls (Beck, U. 2018, P. 27). As an approach, the expansion to international markets has provided firms with an opening to increase their returns, realize other potential economic opportunities, as well as improve their image perception and brand loyalty. Although there are also challenges associated with the entry into foreign markets, the manner in which a venture tackles the emerging challenges significantly determines its survival chance in the new territory.
Outsourcing and Offshoring
Outsourcing is a strategy that has been employed by numerous institutions, which have pursued the global expansion route, based on its cost-cutting approach. When entering new markets, firms have always been primarily challenged by their ability to adopt, embrace, and conform to new customs, cultures as well as language that define the new market (Solli-Sæther, H. and Gottschalk, P. 2015, p.90).
Outsourcing as a platform provides a solution to such challenges among others, by utilizing the local manpower within the new economic niche as the organization’s workforce. The following report will expound on globalization and its impact on today’s businesses as its foremost agenda. Furthermore, this paper elucidates on tactics that managers pursuing expansion into the international market should observe if they wish to remain ahead of the game. In the second segment, the publication will analyze outsourcing and offshoring, coupled with their contribution to globalization, based on an Australian firm Case study.
Globalization and Today’s International Managers
Globalization as a concept is not new as one may perceive it to be, given that the concept has existed for centuries, only evolving with time to its present state. By definition, Globalization is a term that refers to the gradual but global integration of the numerous states economies, through the production of goods and services, trade escalation, as well as investment flows (Hay, C. and Marsh, D. eds. 2016, p. 11). From a phenomenon perspective, globalization emerged as a result of the global outreach fever that swept most nations, transgressing through each of the states military economic, trade and geopolitical niches. The cumulative impact of the global outreach manifested in the erosion of national economic borders, an element that embraced the emergence and growth of integrated international economies.
From a profile perspective, globalization has been defined by; the emergence of global corporations, robust internalization of production related economic activities, growth in the level of specialization, and escalating disaggregation of production. How has this been possible? Globalization as a phenomenon has consistently relied on policy changes as well as technological growth as catalyst platforms (Teece, D. Peteraf, M. and Leih, S. 2016, p. 19).
From a policy perspective, the creation and amendment of numerous trade policies has resulted in the dissolution of trade tariffs and barriers, an element that has opened up and exposed the local markets to international products, while also local products from different nations have been able to trade on the global market platform (Beck, U. 2018, P. 42). Evidently, nations such as Australia, China, and Dubai, all of which opened up their markets to trade and embraced international brands, have gained immensely from Globalization, an aspect that is visible in each state’s current market situation.
Technology as the second catalyst factor propelled the evolution of globalization to what it is today. How So? As a result of its rampant evolution, technology has been integrated into man’s life as a crucial platform in his civilization. The emergence of a technology-based lifestyle, shifted the manner in which consumers’ access, shop, and order for their products, as well as the strategy in which manufacturers, industrialists, and producers advertise, retail, and distribute their products (Hay, C. and Marsh, D. eds. 2016, p. 52). Given that the dependency on technology is still expected to escalate with time, the business world has realized of its importance in globalization and the influence it imposes in the productivity, of goods and services as well as the consumption of the products.
Impact of Globalization: A Business Perspective
Globalization as an economic exposure platform has brought along with numerous advantages as well as implications both from the producer as well as consumer’s perspectives. When focusing on the producer side, which primarily made up of entrepreneurial organizations within the private sector, it is crucial to note that globalization has exposed the sector to competition, fluctuation in prices, as well as the substandard quality of products (Kraidy, M. 2017, p. 31). The following segment will offer an in-depth view of Globalization from a business perspective.
It is crucial to note that from the consumer’s end, globalization has been perceived to bear numerous benefits over time. However, that may not be necessarily the case when the aspect is perceived from a business perspective. The increased exposure of markets has also escalated the vulnerability of ventures both in local and international economies to a myriad of unforeseen risks, aspects that will be expounded on below.
Competition as the first impact of globalization emerges from the opening up of local markets as well as the integration of economies. It is crucial to note that exportation and importation, as well as outsourcing of product and services are crucial aspects of globalization. Unfortunately, the given elements have created an influx of substitute commodities to most products in diverse markets (Donati, P. 2017, p. 15). The cited aspect which has emerged as the entry of new players into the market culminated in the escalation of competition between existing firms and the new entrants. Cumulatively, although the approach has compelled previously existing firms to improve their quality of products and services, it is unfortunate to note that the cost of competition has been overwhelming for firms in markets that are defined by numerous players.
Fluctuation of prices as the second impact of globalization is highly associated with competition and market saturation. It is crucial to note that although globalization opened up local and international markets, the platform also led to the saturation of various markets that were already defined by a presence of numerous existing local players. Most of the international entrants into local markets were able to supply the consumers with alternative or substitute commodities, to local options at a lower price and even a better quality (Teece, D. Peteraf, M. and Leih, S. 2016, p. 27). Case in point, China’s products are renowned for their cheap price, although inconsistent quality. The given aspect nurtures price fluctuation of commodities because local producers will always be compelled to adjust their prices in a bid to compete with foreign producers, and the cost of their commodities, an aspect that culminates in the unsteady prices of goods.
Substandard Quality of Goods
The quality of a product as well as the brand it has crafted for itself, are aspects that significantly shape customer loyalty and satisfaction. Globalization as a phenomenon has compelled most firms operating in the international platform to outsource their products to developing nations, in a bid to realize a wider competitive advantage, margin when compared to other firms operating in the same niche (Kraidy, M. 2017, p. 22).
The downside of outsourcing is that for most organizations, the ability to observe a given set of quality standards becomes impossible especially when the firm focuses on offering services, or manufactured goods. Cumulatively, although globalization is inevitable, its impacts can be positive as well as be overwhelming for organizations without adequate control structures. The following segment will expound on strategies that international managers can adopt in a bid to remain afloat if not advance in the face of stiff and harsh globalization-induced changes.
Today’s International Managers: Winning tips amidst fierce competition
Drawing from the above analysis of globalization, it is evident that the phenomenon has significantly reshaped the manner in which organizations functions, and conduct business, especially within the international market platform. In spite of the prevalent changes, there are several tactics that wise international managers can utilize to continuously attain growth in returns, and market share. In addition to this, the tactics will enable an organization to establish a reputable image that retains a wide base of loyal customers.
Globalization, Identifying and analyzing the existing and potential Competition
For an organization to stay ahead of its competitors within any market niche, the firm should be aware of the existing threats, an aspect that can only be realized by conducting a thorough competitor’s analysis. It is crucial to note that any industry with new players and startups joining every day is considered to aggressively active, and as such, any firm operating within such a niche should consistently update its analysis in a periodical manner (McLean, M. 2018, p. 35). When analyzing the potential threats, it is crucial to identify the primary and secondary competitors as well as the level of threat each player imposes on your particular firm. By doing so, a manager can analyze the strengths and weaknesses of potential and existing competitors, in addition to making strategic moves that will consistently position the organization ahead of the competition.
Assessing and Understanding the Target Market
In any business competition, it is crucial to note that the clients or consumers always represent the judges, as their choice embodies their final opinion about their desired product. In any market niche, a wise international manager will always assess the audience, its expectation, and needs, as well as demands. It is crucial to note that consumer behaviors keep on changing depending on the influence of macro factors such as economic conditions (McLean, M. 2018, p. 54). In such an instance, an astute director establishes constant communication with the organization’s existing and prospective clients, as an approach to remain informed and update on consumer concern, predictions as well as desires. By doing so, a firm can adjust its product pricing, market strategies, product packaging, and promotional campaigns in a manner that will attract potential clients and retain the existing ones.
Outsourcing and Offshoring, Telstra Case study
Outsourcing, when defined, refers to the process whereby a firm subcontracts the organization’s tasks and mandates to various external organizations that have specialized in providing the desired service. In other cases, outsourcing also involves a practice whereby an organization acquires a smaller firm with adequate resources and employees to run its tasks. Cumulatively, outsourcing revolves around the breaking down of a given function, and it’s subsequent assigning to third parties (Oshri, I. Kotlarsky, J. and Willcocks, L. 2015, p. 15).
Offshoring, on the other hand, refers to the purposeful relocation of a specific or cumulative business procedure to another new location, such as a country. A good example of offshoring would be when an industrial firm physically relocates its manufacturing process to a new state. The main difference between offshoring and outsourcing is that the former focuses on establishing an operation in a new state as a result of repositioning, while the latter primarily refers to the subcontracting of a firms’ task or duty to a third party which in most cases is usually an external organization (Solli-Sæther, H. and Gottschalk, P. 2015, p.90).
The fierce aspect of globalization has compelled firms’ overtime to search for innovative and alternative approaches to getting the work done efficiently. Outsourcing and Offshoring have emerged to be promising alternatives means of meeting the production needs of any company. By employing the two approaches, numerous international firms have been able to regulate and cut down operational costs, free up internal resources to support other crucial sectors, and streamline time-consuming functions (Oshri, I. Kotlarsky, J. and Willcocks, L. 2015, p. 48).
Telstra within Australia is presently recognized as the largest media and Telecommunications Company, offering services that include; operating telecommunication network, as well as a vast range of entertainment and communication product and services. As a firm, Telstra prides its purpose to be creating a brilliant and connected future for everyone, a vision it has managed to achieve over time through the expansion of its products and services towards the international telecommunications market.
Expanding into the international market is a move that Telstra implemented provoked by the need to grow the company’s portfolio onto the next level, in addition to embracing the global market platform (CX Central. 2018b, p1). In its expansion operations, the firm has gradually relied on outsourcing and offshoring as approaches to realize its economies of scale and competitive advantage over other players present in the telecommunications industry. One particular and crucial department that the firm has constantly outsourced and offshored to India, Manila, and Perth is its call center operations (CX Central. 2018, p1).
Essentially, under the firm’s international operations plan, Call centers are usually overwhelming departments that are defined by large volumes of low severity type of work. If the firm was to house most of call center operations within its main headquarters back in Australia, evidently quite extensive resources would be committed to the department, to the extent of overwhelming significance performance targets of the institution. Thus by outsourcing and offshoring call center services, the firm is primarily able to focus its resources on dealing with challenging and more severe issues affecting its product portfolio, brand depiction, and customer market base (CX Central. 2018, p1).
Challenges of Outsourcing and Offshoring
Two of the major challenges that Telstra has realized in its international expansion conquest, are cultural and language barriers. As a telecommunication firm, Telstra is constantly in touch with its customer base compelled by the need to introduce and sell new products, as well as offer supportive services (CX Central. 2018b, p1). Given that the firm opts to outsource and offshore its call center operations, most of its customer base across the western world have been complaining of an ineffective call center support base, as in most situations their needs and demands have often been unmet (CX Central. 2018b, p1).
One good example was a recent scenario, where an American customer received poor call center support services that were perceived to be abusive and culturally insensitive, especially after the firm had withdrawn its support for same-sex relationships (CX Central. 2018, p1). It is unfortunate to note that the given aspect resulted from a conflict in cultural and linguistic customs between the firm’s support staff and a worried client, an aspect that could have been deterred if the firm offered locally based call support from America or Australia.
Globalization, Outsourcing and Offshoring Opportunities
From an opportunity perspective, Telstra was able to run its call center support services at a lower cost especially given that the standard labor wage of employees in most of the countries that the firm outsourced its operations are way below what Telstra was offering its initial employees. Additionally, the firm, thanks to outsourcing and offshoring was able to free up more resources back at home and commit them to more severe and demanding issues associated with the firm’s growth and future projections.
In conclusion, it is evident that Globalization is a phenomenon that is here to stay. More so, firm’s that do not embrace this occurrence will gradually become outdated in our ever-changing and first paced world. As economies integrate, there is a crucial need for managers to begin “thinking out of their market niche, and across the globe.” Customer preferences change from time to time, and with that being a significant determining factor of choice, firms should consistently lay down moves that will secure more potential customers besides retaining the existing ones. Additionally, with competition emerging to be a significant defining factor of today’s markets, there is a pressing need for firms to adopt positive elements of outsourcing and offshoring, besides other competition analysis schemes, all in a bid to remain ahead of the curve that is a saturated market full of numerous existing and emerging start-up players.
Beck, U., 2018. What is globalization?. John Wiley & Sons.
CX Central. 2018. Telstra call centre staff in Perth have language problems – CEO | CX Central.
CX Central. 2018b. Telstra’s offshore call centre has a cultural alignment shocker– CEO | CX Central.
Donati, P., 2017. Globalization of Markets, Distant Harms and the Need for a Relational Ethics. Rivista internazionale di scienze sociali, 1(1), pp.13-42.
McLean, M., 2018. Understanding your economy: Using analysis to guide local strategic planning. Routledge.
Oshri, I., Kotlarsky, J. and Willcocks, L.P., 2015. The Handbook of Global Outsourcing and Offshoring 3rd Edition. Springer.
Solli-Sæther, H. and Gottschalk, P., 2015. Stages-of-growth in outsourcing, offshoring and backsourcing: Back to the future? Journal of Computer Information Systems, 55(2), pp.88-94.
Teece, D., Peteraf, M. and Leih, S., 2016. Dynamic capabilities and organizational agility: Risk, uncertainty, and strategy in the innovation economy. California Management Review, 58(4), pp.13-35.
Kraidy, M., 2017. Hybridity, or the cultural logic of globalization. Temple University Press.
Hay, C. and Marsh, D. eds., 2016. Demystifying globalization. Springer.
Impact of Government Involvement in International Trade
International trade can be described as the exchange of services and goods between countries, which gives rise to a world economy where prices are affected by global occurrences (Ajami & Goddard, 2013). As indicated by (Wild & Wild, 2013, p. 123), international trade has the benefit of offering people in different countries a more expansive selection of goods and services at competitive prices.
Given that the idea of international trade has dominated business scholarship for some time, differing opinions exist on whether the international trade should adopt a free trade approach or opt for a protectionist approach. Free trade, in this regard, implies the application of a laissez-faire style of commerce, without market restrictions. The central concept in the international free trade is that demand and supply factors, applied on a global level, ensure efficient production, requiring nothing to be done to either promote or protect business growth. In contrast, the philosophy of protectionism insists on the importance regulating trade to ensure proper functioning of markets. Proponents of protectionism hold that certain market inefficiencies can impede the benefits of international trade, thereby requiring the application of mechanisms to guide the market accordingly. This paper explores the primary motives of government interventions and critically analyzes the consequences of the methods of intervention.
Government intervention in international trade has had a significant impact on trade patterns. Unfair government intervention practices thus have had lasting negative lasing impacts on global economics. This paper looks at the global political economy, reasons for governments to intervene in international trade, consequences of government involvement and ways to prompt the global economy despite the political influence.
The Motives for Government Trade Intervention
Though free trade implies the pattern of exports and imports without any barriers, most governments impose controls on trade for cultural, economic and political reasons. While political motivations include protection of jobs, preservation of national security, response to apparently unfair trade practices of other nations and the quest for influence over other countries, the economic motives include the protection of infant industries and pursuance of strategic trade policy.
Political Motivation: One category of reasons offered for government intervention is political. Most of the political motivations for government interventions are connected to the need for the government to remain popular among its citizens. As indicated by Ajami and Goddard (2013), the political motivations may have little or nothing to do with the economic performance of the country (p. 21).
One such political motive is to protect jobs and, therefore, prevent an increase in unemployment levels. The idea informs the motive for restricting trade to protect jobs that international trade lowers the number of jobs available locally for the citizens of a country (Wild & Wild, 2013, p. 132). Though this may be true for certain industries, studies have established that trade does not necessarily reduce jobs, since business offers consumers a chance to purchase products at competitive prices, which, subsequently enables them to buy more goods and services. Given that most of the products are locally produced, the enhanced purchasing power of the consumer is likely to stimulate the creation of jobs internationally and locally. Moreover, the protection of certain jobs may not be entirely beneficial, and has been shown to lower economic efficiency. According to Silva, Afonso and Africano (2010), an economy can function at maximum efficiency only when its labor force is mobile, and people are willing to alternate jobs need arises (p. 369). Governments must acknowledge that the nature of the economy and, consequently, jobs are constantly metamorphosing, meaning that even their labor force must be flexible and ready to change.
Another political reason often offered for government restriction of trade is national security interests. According to Ajami and Goddard (2013), the argument of national security is often a legitimate argument, especially when it concerns the production of weapons and printing of domestic currency (p. 34). Consequently, industries that are pivotal to national security are offered protection by governments for both imports and exports.
Governments can, for instance, place restrictions on imports to guarantee domestic supply which preserves national security. It is important to note that national security as it is used here is not exclusive to issues of war and armed security. Rather, the concept of national security implies those goods and services that are critical for the wellbeing of the citizens of the country, including currency, agricultural products, oil, and weaponry. For instance, many countries actively protect their agricultural sectors since countries that depend on agricultural imports to feed their citizens risk starvation in the event of war. Governments also place restrictions on the export of defense-related goods, especially if such exports pose threats to international security.
The government can also restrict trade in response to apparent unfair trade practices by other nations. In situations where there is a feeling that their governments give certain industries an unfair advantage through subsidies or reduced restrictions, unilateral reduction in restrictions can be applied. For instance, Fertö and Hubbard (2003) show that, compared to industrialized countries, developing countries have significantly relaxed environmental laws, reducing the costs of operation (p. 245). Governments are often inclined to introduce trade restrictions especially in the face of restrictions by other countries.
States can also use trade restrictions to gain influence over other nations, especially the economically less developed. For instance, the China Uses trade interventions to increase its influence in Africa. The idea here is for an economically stronger country to use its position to influence less developed countries, which ultimately offer a market for its products.
Economic Motives: Besides the political reasons for governments’ intervention in trade, arguments are often fronted on the economic foundations for intervention. Some of the arguments from the economic perspective include the protection of infant industries and pursuance of strategic trade policy. The case for the protection of infant industries is often made so that young industries are protected by the government until they become self-sustaining (Silva, Afonso & Africano, 2010, p. 369).
However, it is not only infant industries that seek protection. According to Melitz (2003), some mature industries insist that they are protected to enable them to adapt to new business environments and conditions (p.1696). Nevertheless, the idea of protecting companies seems to go against the spirit of healthy competition that allows only the most successful businesses to be sustained. This presents problems to the government seeking to intervene on trade based on the argument of the infant industry. The first challenge would concern how to pick winners and reject losers. The idea also leaves room for people within the echelons of power to use that power to initiate protection for their companies. Besides, protection has the potential of encouraging complacency by domestic companies towards innovation and can limit company competitiveness.
Regarding the pursuance of strategic trade policy, government intervention can enable a company to enjoy the first-mover advantages and the subsequent economies of scale. The concept of first-mover advantage can be described as a type of competitive advantage that accompany attains by being the first entrant into an industry or a market (Fertö & Hubbard, 2003, p. 251). The understanding here is that, by being the first competitor in a new market, the firm can gain an advantage over its actual and future rivals. This idea applies whether a company is seeking to develop new demographic markets or sections of existent markets, or whether it is looking to introduce new products into its already existent market segments.
When a business is the first to enter a market, it can form a defensible ground, allowing it to capture the large sections of the market share quickly without being concerns about rivals competing for the same market. Also, by the time the competitors arrive, the first-mover is likely to have advantages in the competition because its products will have gained familiarity, besides other factors like brand loyalty established distribution systems. For instance, being a first-mover in soda production, Coca-Cola was able to develop its brand and build a reputable force in the beverage industry. The biggest problem with the strategic trade policy is that government support is often subject to political manipulation, and certain interest groups can usurp gains with no benefit to the consumer.
Cultural Motives: Cultures are created and modified through interactions. Consequently, the exposure of citizens of a country to other people and products from other nations can gradually alter the culture of a country. In this line of thought, the undesirable cultural influence caused by interaction with certain products can cause the government to block imports. The United State, for instance, is often perceived as a threat to national cultures due to its influential entertainment, consumer goods, and media.
Methods of Promoting Trade
Other than specialization and increased business potential, international trade has been linked to greater efficiency and greater opportunity for foreign direct investment. As described by Wang et al. (2012), foreign direct investment implies the amount of money invested by individuals and corporations in business as well as in research and development (p. 627). By attracting foreign direct investment, economies can grow in their level of competitiveness and production efficiency. For the receiving government, foreign direct investment is a way through which expertise and foreign exchange can enter the country, further stimulating economic growth. Given the importance of international trade to governments as well as consumers, various states adopt steps such as subsidies, export financing, foreign trade zones, and individual government agencies to encourage international trade.
Subsidies: For our purposes, a grant can be defined as financial assistance to domestic companies in the form of low-interest loans, cash payments, product price supports, or tax breaks. The primary intention of applying subsidies is to increase the advantage of the local companies and compete favorably with international firms. According to the World Trade Report (2006), export subsidies generate incentives for producers to supply products for export rather than for domestic use within a country (p. 56). This can be a drawback since the withdrawal of supply from the local market can lead to increases in the local price of the products. Simultaneously, due to increase in supply to the world market world prices of the product is likely to fall. If the re-importation of products from the world market into the domestic market is prevented, the result is a wedge between the world price and the local price. All the same, the impact of export subsidies on the domestic country is contrary, with local consumers having to pay higher for a product that they are prevented from sourcing from the world market as a lower price.
Export Financing: In export financing governments promote exports by assisting companies to finance their trade activities through loans as well as loan guarantees. Since funding is crucial, especially for entrants into the export business, the philosophy informing export financing is that by offering loans that would have otherwise been accessible of loans at reduced rates, the government can encourage export business, and enhance the competitive edge of the company. In the United States, for instance, export financing is offered by Export-Import Bank.
Foreign Trade Zones: A foreign trade zone is an area where goods can be landed, handled, reconfigured or manufactured, and even re-exported without going through customs authorities. The goods only become subject to the prevailing customs duties when they are moved to consumers in the country within which the zone is located. Organized in areas with various geographical advantages for international trade such as Singapore, Stockholm, Hong Kong, and Gdańsk, the primary purpose of the foreign trade zone is to eliminate seaport, border, and airport barriers to trade, often associated with complex customs regulations and high tariffs. Lowering customs facilitates international trade since customs duties elevate the cost of production as well as the time it takes for the products to reach the market. In the United States, for instance, the lowered customs duties are balanced by the created jobs.
Special Government Agencies: As a way of encouraging international trade, various governments create agencies charged with the promotion of exports. The agencies organize trips for business persons and trade officials to visit other nations and institute trade offices in other countries. These organizations, such as the Japan External Trade Organization not only promote exports but also occasionally encourage imports.
Trade Unions: Trade unions today play a critical part in moulding the lives of workers, though their influence has considerably diminished over the recent past. The union is often mandated to negotiate conditions and contracts with employers on behalf of the employee. Though the roles of trade unions are numerous, some being more prominent than others, the trade unions core functions can be summarized as social, militant, regulative, and fraternal. In this regards, the militant function implies the struggle that is likely to occur as the union tries to get employers to increase worker remuneration or to address the grievances presented by employees. The main issue addressed here is whether the perceptible incompatibility between industrial relations and employees can be resolved. Resolution of the conflict between trade unions and employers is only possible given the assumption that both parties share the objectives of employee development, fairness, and equity.
Unions need to acknowledge that collective bargaining may require some redesigning to include a lesser component increasing pay than in the past, and should push for involvement in skill-based and flexible elements of pay. Industrial relations remain the principal way of maintaining industrial order and should focus on approaches to avoiding and resolving disputes and conflicts.
Methods of Restricting Trade
Most governments restrict international trade to protect domestic companies from external competition, mostly from multinationals. One such method of restriction is through tariffs. Tariffs are taxes levied on imported products as they enter or leave the country. Tariffs can be categorized as import, transit and export. Import duties are further subcategorized into ad valorem, specific, and compound. An ad valorem tax is levied as a percentage of the cost of the imported good while specific tariff is levied according to each unit (by weight or number). On the other hand, the compound tax is levied as a percentage of the stated price of the imported product, and partly as a specific fee for each unit. According to Wild and Wild (2013), besides protecting local producers and employees from foreign competition, tariffs perform the function of raising revenue for the government (p. 232). Though domestic producers gain from import duties as they are shielded from foreign competition, this protection comes at a cost to the consumer. The consumers often have to pay more for some imported goods. Also, though the producers benefit from the lowered foreign competition, the lack of competitiveness may lead to laxity and reduced overall efficiency.
Quotas and Voluntary Export Restraints (VER): Quotas and Voluntary Export Restraints (VER) are restrictions directed towards the quantity of certain goods that can be imported into a country (Wild & Wild, 2013, p. 143). The quota limitation is usually imposed by allotting import licenses to a group of firms or individuals. The reason for issuance of allowances is to protect domestic producers by limiting the entry of certain goods into the country. This limitation enables local producers to maintain a considerable market share in to offer decent prices for their products within the country. Like in tariffs, the gain by producers comes at a cost to consumers, who have to contend with high prices caused by impeded competition. A VER, on the other hand, is a unique type of quota imposed by the exporting country upon the request of the government of the importing country. If the domestic producers do not limit production, consumers gain because of lowered prices from the increased supply. Other measures that can be applied by governments to restrict trade include embargoes, content requirements, administrative delays and even currency controls. Ultimately, the reasoning behind restrictions is to protect local companies from foreign competition and to ensure that the economic interests of the country are not ignored during the international trade.
Despite the theoretical benefits associated with international trade, governments are not always eager to openly welcome free trade at the expense of domestic businesses. This paper examined the reasons behind the government interventions to protect some of their local industries and the methods they use to offer such protection. Though it is evident from the analysis that many of the strategies like tariffs, the quota system, and subsidies appear to support domestic producers, this support often comes at a cost to the consumer, who often has to pay more for goods. Measures must be put in place to ensure that even in protecting the domestic companies, healthy competition that is important for production efficiency and reasonable pricing of products is not compromised.
Chaney, T. (2008). Distorted gravity: the intensive and extensive margins of international trade. American Economic Review, 98(4), 1707-21
Girma, S., Görg, H., & Wagner, J. (2009). Subsidies and exports in Germany, evidence from enterprise panel data. Applied Economics Quarterly, 55 (3), 175-195
Martincus, C. & Carballo, J., (2008). Is export promotion effective in developing countries? Firm-level evidence on the intensive and the extensive margins of exports. Journal of International Economics, 76, 89-106
Wang, C., Hong, J., Kafouros, M., & Wright, M. (2012). Exploring the role of government involvement in outward FDI from emerging economies. Journal of International Business Studies, 43(2012), 655-676
Wild, J., & Wild, K. (2013). International business: The challenges of globalization. Upper Saddle River, NJ: Pearson Education, Limited
World Trade Report. (2006). Exploring the links between subsidies, trade and the WTO. World Trade Organization
Project Management Standardization Dissertation – Poor project performance has led to industry calling for Standardized Project Management tools, yet it is the organizations themselves who have chosen to overlook or ignore the tools while implementing organization strategy that exists for their assistance. This paper investigates the implications change management practices have on individuals as a result of strategy change, whilst challenging the poor Project Management knowledge and understanding of individuals within project based organizations.
It also identifies the currently poor application of Project Management theory including the alarming levels of academic qualifications many practicing Project Managers currently hold. The purpose of the dissertation was to explore this call for standardization by conducting a review of the knowledge, understanding and opinions of individuals regarding: change management implications of organization strategy implementation; and organizations? application of Project Management theory.
However, while conducting the review, offering discussion points or arguments, it is important to recognize when talking about Project Management Standardization, it is not an exact science and there are several fundamental floors such as the theory is relatively abstract and many parameters are difficult to be measured as they are usually based upon the opinion of industry personnel with predetermined beliefs.
The aim of the dissertation was to identify and understand evolving management theory and how it aligns with organization strategy as it was believed that with such a large amount of capital being spent on projects, organizations did not place a high enough level of priority on Project Management processes or academic qualifications. Whether this is a result of ignorance, or just a pure lack of understanding of the implications on the behalf of executive level management, was the basis for discussion throughout the dissertation. Finally projects are aimed solely at either increasing profit in line with organizational mission requirements or increasing efficiency through productivity. So the dissertation is written with the intention of raising awareness to improve project performance and not just to highlight organizational short comings.
The dissertation aim is to investigate how evolving Project Management theory, organizational strategy and change management implementation and Project Management academic levels influence individual’s perceptions and actions within project based organizations.
To identify and introduce evolving management theory
To analyze the role that Project Management has within organizations strategic management processes
To investigate the level of understanding individuals within organizations have of Project Management processes
To investigate the academic levels of individuals within project based positions
Conduct a questionnaire based on the aims, objectives, and literature review formulating a strategic set of questions to challenge senior managers with an interview in relation to the concerning trends
If you enjoyed reading this post on standardization of project management, I would be very grateful if you could help spread this knowledge by emailing this post to a friend, or sharing it on Twitter or Facebook. Thank you.
Over the past few decades, the global scenario has changed considerably with increased interdependence amongst nations and economies. This intertwining amongst nations and sharing of ideas and technology has been termed as “Globalization”. Globalization has been a buzzword of late, with heated discussions about its pros and cons. Some consider it to be a blessing for mankind while others take it as a curse. For some it has brought about material prosperity while others have become unemployed due to it. This paper tries to analyse the effect of Increased International Trade and Globalisation on the US economy. The first section discusses the pros and cons of Globalization while the second section discusses how globalization has lead to increased foreign trade. Thereafter, it discusses the effect of globalisation and increased foreign trade on the American economy.
Trade is believed to have taken place throughout much of recorded human history, whether as barter or in exchange of currency. Till the 1800’s, trade was limited due to difficulties in transportation, communication and restrictive trade policies. However, in the mid 19th century, with advent of free trade and nation advantage concepts, trade started to pick up (Daniels & Sullivan, International Business and Operation). Although international trade has been present throughout much of history, for example Silk Route, its economic, social, and political importance have increased in recent centuries, mainly because of Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing. Worldwide, countries are doing away with trade restrictions and lowering trade tariffs, thereby supporting free trade and making the world a global village (Daniels & Sullivan, International Business and Operation).
Globalization – Boon or Bane
The global economy is no longer an individual event and USA no longer plays the dominating role. This is apparent from the fact that ten years ago the World Trade Organization had only 80 members whereas now it has 153 members (WTO Data, 2010). Also countries like China and India are getting more bargaining power day by day. Globalization is the deepening relationship and broadening interdependence amongst the different countries of the world. The World Bank defines globalization as “the growing integration of economies and societies around the world.” This integration of regional economies into a global village has lead to increased international trade, investment, capital flows and technological advancements. Technological advancements such as the internet and cell phones have literally reduced the world to a Global village. Globalization has both its critics and it supporters. Some interpret it as a way of countries losing their cultural identities and becoming “Americanized.” Others see it as a way to reduce costs and to increase profits and efficiency. The debate over globalization is perceptible in demonstrations against the WTO in Seattle in the fall of 1999, against the Summit meetings in Quebec and Genoa and against several annual meetings of the IMF and World Bank. While on the other hand, supporters of globalisation look forward to a global village, linked together by the Internet, and enjoy the ever-increasing material well being (Daniels & Sullivan, International Business and Operation). The United States is seen by much of the world as the strongest supporter of globalization – in fact, as pushing it on everyone else. Over the years, globalization has resulted in increased foreign trade and capital flows, thereby contributing immensely to the domestic economy. In the 1990s, globalization and free trade, resulted in integration of China and the former Soviet bloc into the trading system thereby lowering inflation and opening new markets. However, as the emerging markets got stronger, the prices of commodities started rising immensely and competition from foreign workers lowered the average US wage rates. Jeffrey Garten, professor of international trade and finance at the Yale School of Management, points out that in 2000, the world’s wealthiest countries accounted for about 70 percent of the global economy, compared with 30 percent for developing economies. These rates are slowly but surely reversing. Thus, USA has seen both the positives and the negatives of globalization.
One important effect of globalization is the increased interdependence among nations which has demanded increased liberalization of markets, the dismantling of almost all trade barriers (Lee, 2005; Czinkota and Ronkainen, 2007). As a result, the forces of globalization have necessitated trade liberalization (Martin, 1993), leading to increased international trade, not only in good and services but also currency and capital. Ever since independence, America has been a supporter of Free Trade. In 1988, USA signed a Free Trade Agreement with Canada that progressively eliminated tariffs over a ten‐year period, thereby making Canada USA’s premier trading partner. Further, in 1994 the Mexican Government, in pursuit of market reforms, signed the North American Free Trade Agreement (NAFTA). The passage of the NAFTA agreement signalled the continuing support of U.S. policy‐makers for the worldwide march toward free markets and further economic globalization (Paul. S Boyer, 2001). The above agreements lead to immense increase in trade and greater market efficiency. However, by 1999 USA had a huge trade deficit of around USD 200 billion (Paul. S Boyer, 2001). The trade boom of the 1990’s had ended in a recession marked by serious job losses and the nations policy of “free trade” was being questioned. President George W. Bush insisted that America’s economic future lay with the global economy, but early in 2002 political pressures led him to slap import duties on cheap foreign steel. However, he was forced to withdraw it in 2003 due to retaliation against US exports and WTO sanctions (Paul. S Boyer, 2001)
Competition and Business Restructuring
International competition goes hand-in-hand with globalization. A company that has been very successful in the domestic market may suddenly find itself facing competition from a yet unheard of company from the other end of the globe. Survival in this new business environment calls for improved productivity, reduction in costs, up gradation in technology and advancements in supply chain management (O’Reilly, E., & Alfred, Diane., 1998). For example, In the 1980s American automobile manufacturers began losing market share to Japanese competitors who offered American consumers higher quality cars at lower prices (Brewer, G., Managerial Accounting). However, from the consumer’s point of view, increased competition promises greater quality, reduced prices and a greater variety of goods and services. China’s entrance into the global marketplace has proved that globalisation leads to competition and changes the business environment. For example, from 2000 to 2003, China’s wooden bedroom furniture exports to the United States increased by more than 233% to a total of $1.2 billion. During this same time, the number of workers employed by U.S. furniture manufacturers dropped by about a third, or a total of 35,000 workers (Fishman, T., 2005).
In a 2002 speech, the Economic counsellor to the US Embassy, Mr Lee Brudvig, said, “We have not resisted the free flow of money, goods, services, and ideas. Rather, we have subjected our companies to market competition and limited the role of government on the whole to that of facilitator, regulator and, when necessary, safety net provider. As a result, we have seen a massive reorganization of business structures. Whereas in 1960 manufacturing accounted for 27 percent of GNP, by 2001 it had dropped to below 15 percent.” The changes brought about by technology and productivity is causing both markets as well as organisations to undergo restructuring.
Labour Market Developments
An important trend in labour markets in the advanced economies has been a steady shift in demand away from the less skilled toward the more skilled (Slaughter, M., & Swagel, Philip., 1997). Studies have shown, for the advanced economies as a whole, that trade with developing countries has led to about a 20 percent decline in the demand for labour in manufacturing, with the decline concentrated among unskilled workers (Swagel, Philip., 1997). This trend has produced dramatic rises in wage and income inequality between the more and the less skilled. In the United states, wages of less-skilled workers have fallen steeply since the late 1970s relative to those of the more skilled (Slaughter, M., & Swagel, Philip., 1997). According to a study conducted in 2007, the impact of trade flows in 2006 increased the inequality of earnings by roughly 7% (Bivens,J., 2007). The study goes on to prove that although “liberalized trade” is a win-win proposition for nations, it reduces the income of most workers. Workers employed in industries directly in competition with low-cost imports from abroad can expect to see immediate job dislocation and/or downward wage pressures.
The rise of labour abundant nations, like China and India, has increased the global labour pool. The price of labour-intensive commodities falls as a result of this increase in the global labour pool, and these falling prices harms the labour in professional-abundant nations like the United States. DVD Players, clothing and call centre operations, all provide examples of reduction in prices due to expansion in the global labour pool (Slaughter, M., & Swagel, Philip., 1997). Outsourcing and offshoring, has further increased unemployment and decreased national earnings. 22-29% of the U.S. workforce has been rated as potentially offshorable over the next one or two decades (Blinder, 2006). The implied loss due to offshoring would push these wages well below the 1979 levels, completely undoing the entire increase in these wages over the past three decades. The trade adjustment assistance (TAA) program has been formed as a way to compensate globalization’s victims in the United States. In 2006 TAA allocated $655 million in income supports for workers harmed by globalization, and, another $200 million for training. As quoted by Bradford, Grieco, and Hufbauer in their study, “While the gains from increased trade generate a permanent rise in income, the associated losses are temporary. Nevertheless, they are very real, and are concentrated on a small fraction of Americans”.
Financial Market Globalisation
Financial globalization has been one of the most important trends in the world economy in recent decades. Financial globalization has been one of the most important trends in the world economy in recent decades (Lane and Milesi-Ferretti 2003). International financial liberalization was also accompanied, in a
somewhat chicken-and-egg causal relationship, by the abandonment of the Bretton Woods system of adjustable exchange rate pegs and the shift to floating exchange rates among the major currencies or regional currency blocs (Eatwell 1996). When currency fluctuations are considered, it is the exchange rate between the US dollar and the euro that gets the most attention. This not only reflects the size of the respective economies using these two currencies, but also the fact that the US dollar is the most widely traded currency today. That’s because it effectively serves multiple roles: as an investment currency; as a reserve currency for many central banks. According to an IFSL research conducted in April 2007, the US dollar was involved in 86% of foreign exchange transactions, followed by the euro (37%), which proves its importance (Safar, L., 2008). The report further states that foreign currency trading increased by 70% in 2008 compared to 2004. This increase in currency trading makes it imperative for companies to learn to deal with exchange fluctuations and how to benefit from all situations. The US dollar has fallen since January 2004 against the euro as well as against most major European and Asian currencies. This has caused many companies to introduce a “fluctuation clause” in their contracts to protect themselves from losses due to exchange rate fluctuations and has also lead to the development of many financial instruments to help companies hedge their currency risks. However, times such as these when the dollar becomes weaker often works well for US producers with a larger proportion of their costs being in dollars but selling worldwide. International revenues not only translate to higher US-denominated revenues, but they also contribute to higher margins which can be achieved globally (Safar, L., 2008). For example, Q1 2008 for instance marked a milestone for Google, whose international revenues exceeded US revenues for the first time. Revenues from outside of the United States represented 51% of total revenues in the period, compared to 47% in the first quarter of 2007 and 48% in the fourth quarter of 2007. In Q2 2008, this had increased further to 52%. According to Google, “Had foreign exchange rates remained constant from the second quarter of 2007 through the second quarter of 2008, our revenues in the second quarter of 2008 would have been $249 million lower.” (Safar, L., 2008). Nothing can be predicted with 100% accuracy when it comes to exchange rates, and the only thing that can be safely said is that there will be no “business as usual” when it comes to currencies.
Political and Institutional Changes
According to CIA Global Trends 2015, 2000,” The rising tide of the global economy will create many economic winners, but it will not lift all boat. It will spawn conflicts at home and abroad, ensuring an even wider gap between regional winners and losers than exists today. Regions, countries and groups left behind will face deepening economic stagnation, political instability and cultural alienation. They will foster political, ethnic, ideological, and religious extremism, along with the violence that often accompanies it.” One of the most important and necessary features of the current process of globalization is the proliferation of international organizations. Scholars point to the emergence of expanding web of international treaties and institutions, which regulate and adjudicate on matters of interstate behaviour. The number of international organizations rose from 61 in 1940 to 260 by 1996 (Barnett 2002:110). Since 1995, when the World Trade Organization (WTO) was formed, transnational corporations have increasingly influenced political leaders to push international trade laws in the same direction of liberalization and deregulation. In addition, existing international organizations like the IMF, the World Bank and the GATT/WTO have transformed their roles substantively, gaining further powers and responsibilities (Camillery and Falk 1992:94-7; O’Brien et al. 2000). The United States has enjoyed a position of power among the world powers, in part because of its strong and wealthy economy. Due to this reason, the United States enjoys considerable bargaining powers in the WTO and World Bank. With the influence of globalization and with the help of The United States’ own economy, the People’s Republic of China has experienced some tremendous growth within the past decade, and now enjoys as much bargaining power, if not more, as USA. If China continues to grow at the rate projected by the trends, then it is very likely that in the next twenty years, there will be a major reallocation of power among the world leaders. China will have enough wealth, industry, and technology to rival the United States for the position of leading world power (Fishman, T., 2005).
Crime and Terrorism
At the end of the 20th century, a new phenomenon appeared—the simultaneous globalization of crime, terror, and corruption, an “unholy trinity” that manifests itself all over the world. This unholy trinity is more complex, however, than terrorists simply turning to crime to support their activities or merely the increased flow of illicit goods internationally. Rather, it is a distinct phenomenon in which globalized crime networks work with terrorists and both are able to carry out their activities successfully, aided by endemic corruption. Crime groups and terrorists have exploited the enormous decline in regulations, the lessened border controls, and the resultant greater freedom, to expand their activities across borders and to new regions of the world. The United States has been one of the worst sufferers of this new “global” terrorism. Since September 11, 2001, numerous resources have been shifted in the United States and elsewhere from addressing trans-national crime to fighting terrorism. It has increasingly become clear, that for a nation to advance, it has to keep its crime and terror activities in check.
Cultural and Other Issues
The growth of cross-cultural contacts has helped the United States participate in a new World Culture. It has helped Hollywood reach remote corners of the world while at the same time Bollywood has reached out to the Americans. Globalization has also lead to greater international travel and tourism thus greatly benefiting the tourism industry. WHO estimates that up to 500,000 people are on planes at any one time. (WHO Data, 2009). In 2008, there were over 922 million international tourist arrivals, with a growth of 1.9% as compared to 2007 (UNTWO Data, 2009). Globalization has also increased the number of illegal immigrants entering USA. The Rockridge Institute argues that globalization and trade agreements affected international migration, as laborers moved to where they could find jobs. The Mexican government failed to make promised investments of billions of dollars in roads, schooling, sanitation, housing, and other infrastructure to accommodate the new maquiladoras (border factories) envisioned under NAFTA. The 1994 economic crisis in Mexico, which occurred the year NAFTA came into effect, resulted in a devaluation of the Mexican peso, decreasing the wages of Mexican workers relative to those in the United States. Unemployment, corruption, low wages and few opportunities cause Mexican laborers to look for greener pastures and migrate illegally to the United States.
Globalization leads to increased international trade and reduction in trade barriers, which is beneficial for all the trading nations. Increased globalizartion has increased competition in the global economy, making it tougher for organisations to survive, and leading to greater productivity, efficiency and quality. This has in turn lead to the rise of countries like China and India, which are rich in labour. Due to the rise of labour abundant nations, the US labour market has suffered with fewer jobs being available for unskilled workers and lowering of wages. Further, outsourcing and offshoring have lead to loss of jobs and unemployment. In order to establish a set of trade rules and monitor the trading nations, institutions like WTO, IMF and World Bank have gained in importance. The United States hold a very important place in all these institutes, due to its strong economy and political power. Thus, it has a huge bargaining power when it comes to trade regulations. Overall, globalisation has affected America both positively as well as negatively but it is primarily due to globalisation and increased trade that America has a strong economy today.
Bivens, J., 2007, Globalisation and American Wages: Today and Tomorrow,
The author examines the effect of globalisation on wages and predicts what the future is going to be, based on mathematical models.
Blinder, Alan. 2006. Off-shoring: The next Industrial Revolution. Foreign Affairs magazine.
Boyer, P., Foreign Trade, U.S., The Oxford Companion to United States History.2001.Encyclopedia.com.
Boyer, P., Global Economy, America and the., The Oxford Companion to United States History. 2001. Encyclopedia.com. Accessed on 22 Apr. 2010 at
Daniels & Sullivan, International Business and Operation, 11th Ed, Pearson Education
Eatwell, John. 1996, International Financial Liberalization: The Impact on World
Development, Office of Development Studies, Discussion Paper Series (September). New York: United Nations Development Programme.
Fishman, T., 2005, How China Will Change Your Business, Inc. magazine,
O’Reilly, E., & Alfred, Diane., 1998, Innovations in Technology and Globalization,
Slaughter, M., & Swagel, Philip., 1997, Does Globalization lower wages and export jobs?, IMF Report,
UNWTO World Tourism Barometer (World Tourism Organization) 7 (2)