Being one of the most spoken of topics, Globalization has been defined in many ways connected to different perspectives. This is because integration is taking place in all aspects of our lives. For the sake of clarity, this paper will illustrate a broad definition of Globalization, one that entangles a broader point of view. According to the Levin Institute (The State University of New York):
“Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world.”
A new development towards a so called “shrinking world” is the changes in governmental policies of free trade (such as by the World Trade Organization) in the last hundred years that encouraged cross-border trade, investment and migration.
A vast development of information technologies and air transportation had an enormous impact on trade- international trade has increased by 20 times since 1950 and foreign investment has doubled between the years 1997 and 1999. Moreover, the strive for globalization is not new- for centuries people have been investing in companies in other countries, as well as trading.
Furthermore, the wave of regulating domestic and international policies of free trade and the reduction of commercial trade barriers increased the potential of many companies to create factories and offices abroad, making countries’ borders to slowly disappear and the creation of a “never-sleeping” global economy.
In addition, technology, such as air transportation and the internet, is considered to be the main driver of globalization in the pursuit of economic opportunities.
A major industry, air transportation, according to Prof. Ken Button of School of George Mason University, USA, impacts the economy, the politics, and social processes of a given country. It can facilitate in many industries, such as tourism, and boost efficient growth. As with every other industry, Globalization has an effect on air transportation as well- airlines started forming global networks, for example, international air transport in the EU can be seen as one single market.
Communications development and air transportation go hand by hand; air transport assists in the opening of labour markets and has been benefitting from communications in terms of traffic control, navigation, logistics optimization and safety.
Air transportation moved in the past years from being highly regulated and playing mainly a huge role in military goals, to integrated industry dealing with the transport of people and goods for personal and commercial purposes. Further, statistics show that approximately 1 per cent of EU’s and US’ GDP is of aviation, as well as 40 per cent of the world trade value; the industry today operates in a liberal context market and governmental intervention has been removed, especially in the EU. Some of the implications of globalization on airline markets are: the shift in fares, the creation of “open-sky” policies, which removed capacity constraints, both of which contributed to demand shifts and allowed price flexibility, as well as bigger competition; it liberated international services and linked domestic and international aviation companies. (4-40)
Similar to air transportation, the Internet has a rapid growth during the years and it started its existence for military purposes- it dates back to 1969, when it was part of a Defence Department project, which subject was digital communications, according to the internet encyclopaedia. The only communication system until that time was telephone communication. Moreover, the first network was created, the “catenet”, and the internet program was launched by DARPA (Defence Advanced Research Projects Agency).Since mid 1980s the network available was called the ARPANET and was used by huge computers connected to it, and most features of the internet that we recognize today were placed, such as IP and TCP protocols. Late 1980s was the time for the PC revolution and early 1990s of the address exhaustion. Only in mid 1990s the World Wide Web was created. Since then, a free information flow has been created, allowing businesses and people to communicate throughout the world for free. This in turn allowed businesses to operate with base offices in different countries. Communication and negotiation became easy and vast, making international markets to grow even faster. Businesses started the usage of intranets, such as Web 2.0, in order to optimize organizational flow of information and delegation; internet networks assisted information reaching the right places and companies to always be updated.
In conclusion, the benefits of air transportation and the Internet vary from industry to industry, but in general, the main benefits are the assistance in the creation of free trade, which in turn globalized markets and transformed economic life forever, allowing businesses to analyze economic trends in a faster way that was never possible before. As for many other things, globalization, with the help of air transportation, the Internet and other communication systems, has proponents who argue that poor countries now have bigger opportunities for development, while others disagree and claim that the creation of international corporations and globalization gain on the expense of domestic and national companies. The balance between these two lies upon the understanding of Globalization and its importance to our economy, as well as to our every-day lives.
Bibliography Button, Ken. School of George Mason University, USA, 2008. The Impacts of Globalization on International Air Transport Activity. Print The Internet Encyclopaedia. Internet History. n.d. Web. 23 Nov, 2011. <http://www.freesoft.org/CIE/Topics/57.htm> The Levin Institute, The State University of New York. What is Globalization?, n.pag. Web. 23 Nov. 2011.
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