![]() The many macro-economic impacts and implications of globalization being witnessed today had become most notable with the close of the cold war. The most interesting fact and important aspect, at the same time here, is that nowadays, globalization greatly influences the world from business and economic points of view.Įven though the phenomenon of globalization has been there since the beginning of time, it was only in recent years when its impacts on global societies would be visible (Levitt, 2003). ![]() This way, people would be able to see the right balance between costs and benefits associated with the disruptive trend. ![]() This, however, comes as the critics continue blaming the phenomenon for all the uncountable economic nightmares facing the world today.Īs a matter of fact, the impacts and implications of globalization for a global economy are immense, but people of all regions should first of all be able to identify the policy choices facing their societies and how these would impact globalization. Globalization is also viewed by proponents as an irresistible force that will certainly bring economic prosperity to people all over the world. Whereby its proponents believe that it facilitates economical developments in poor nations, the opponents would have a different perception that the outcomes of this universal trend over the years have only succeeded in benefiting Western multinational corporations at the expense of local cultures and enterprises. The issue of globalization is deeply controversial and a highly contested issue in the contemporary world. This paper provides a general analysis of the major impacts of globalization and the effects this would have on the global business. However, the recent policy and technological advancements, as observed over the past recent decades have opened economies locally and internationally for many countries, thus triggering increases in cross-border investment, trade, and migration. Globalization is arguably one of the most significant forces impacting the world economy today, and is usually characterized by its many incessant effects on political systems, on culture, on the physical well-being of humans in regions around the world and also on economic prosperity (Kraemer, 2002).Īs it would be observed, the trend of globalization is not new to the world, for people and corporations separated by great distances have been trading with each other for thousands of years. However, the most general definition for globalization is that it is a process of integration and interaction among governments, companies, and individuals of different regions, a process driven by information technology and international trade, among other factors. According to these authors, many of the positive impacts observed in these countries are largely due to increased investment opportunities and financial development induced by greater openness of capital markets.Globalization is a term that has increasingly become very popular in the present world and is applied differently in various contexts of the literature. In acknowledging the existence of these potential impacts, the industrialized countries have been committed to capital account liberalization policies for over a quarter of a century. While dominant economic theory suggests that capital account liberalization has a more or less significant impact on economic growth, there are also a number of works that call into question the existence of capital mobility-related benefits.ĭominant economic theory suggests that financial globalization and international financial integration may foster more efficient resource allocation, facilitate risk diversification, increase specialization in production, create technological spin-offs, contribute to the development of the financial system, improve investment rates and boost growth (refer, in particular, to IMF (2001) Edison, Klein, Ricci and Sløk (2002a and 2000b) Henry (2000) King and Levine 1993) Mougani (20) Obstfeld (1994) Prasad et al. ![]() The purpose of this study is to provide an empirical analysis of some of the impacts of international financial integration on economic activity and macro-economic volatility in African countries.
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