What does Globalization mean for you?
Globalization. Something that has evolved throughout history to define the way we communicate and interact with each other today. Why did China have such massive investment growth throughout the late 20th century? Why are the majority of call centers located in India? Globalization is the defining feature of change in modern society, and affects everyone, whether they realize it or not.
So, what is globalization? As defined by google, it is the free movement of goods, services, people, capital, technology, and information. That was lengthy and not even close to the full story. In reality, it is much more than that, it is the spread of culture, the creation of interdependent countries, and a more efficient and capitalistic world. The first well documented case of globalization was with the advent of the silk road, where goods from the east were traded to the west, and vis versa. It was one of the first large scale connections of very different people and culture, and grew to feed the growth and prosperity of the ancient China, Rome and Persian empires for centuries. As transportation and technology grew at an exponential rate with inventions such as the steam engine, globalization also grew at an exponential rate, and as a result, people today are more connected with on another than ever before in history. Take for example the fact that you’re reading this from some guy you’ve never met and never heard of on an online blogging site. Pretty cool when you stop and think about it.
The interesting thing about globalization is that it won’t ever stop. People want to get the best goods for the lowest price, and if that means importing various goods and exporting labor that’s what will happen. Or people will turn to illicit behaviors, such as smuggling, to achieve this goal. This is exactly what happened in Argentina when they said that the only cellphones that could be sold in Argentina had to be made there. Originally, all seemed to be going well, employment and industry were on the rise, but people weren’t getting as many phones as they demanded, and the phones that they did get were outdated. As a result, there was a large market for smuggled phones from a different country, and the Argentinian phone plants eventually failed, and they returned to importing phones. The reason for this is comparative advantage, a concept coined by David Ricardo in 1817, is the idea that every country should specialize in and produce only the goods that they can make the cheapest. This is why so many goods are manufactured in China, they have the infrastructure and factories to mass produce most goods, and have the enough people who are willing to work in factories that China has resulted in having a comparative advantage in manufacturing. It’s a similar story with India and call centers. India had both the workforce and infrastructure to justify moving call centers there. Interestingly, in this case, jobs at call centers are considered very good jobs and are very competitive because the pay is high. So, a job that in most western countries would be considered low paying and undesirable has yielded a desirable and high paying one in a different country. Comparative advantage at its finest.
Either way, how does this affect you? As a consumer, it means that you will be able to buy the best product for the lowest price possible, which is spectacular and pretty straight forward. It’s like Walmart, brand name products at dirt cheap prices. As a worker, you can expect the job market to be especially competitive because instead of competing with just your local area or country, you will be effectively competing with the world for the job. It’s pretty stressful and relatively unprecedented in human history, but it has reached this point. So what can you do to compete at world level? Depending on who you talk to, you’ll probably get a variety of answers, but in my experience the best move is to get educated, and make sure that you don’t stop learning even after you get a degree. Stay up to date on the newest technology and information, seek advice from other successful people and learn from their mistakes. Another very important part of learning that is somehow never taught, yet super useful, is the ability to network, communicate well and be a good member of a team. The soft skills. If you need any help with these, a new company called Eyesight Collective has super cool videos, workbooks, and courses to help master these.
Either way, as Bob Dylan once said, “the times they are a changin’”, and this could not be clearer than with globalization. The only question is what are you going to do about it?