Improvement In Technology And Market Innovation

How Do Improvement In Technology And Market Innovation?

 

Introduction

The emergence of neoliberalism along with globalization created a new era in the political and economy of various countries around the world. The concept of neoliberalism is made its significant presence in the mainstream of economy for almost 30years. The neoliberal approach assures everyone in the society that the people would be gaining from the effects of globalization. However, the real world scenario is somewhat different. This assignment highlights the various advantages and disadvantages of neoliberalism and globalisation and its effects of the economy and global politics. The advantages and disadvantages of the concepts of globalization and neo-liberalism have been highlighted in details in this assignment.  

 

Neoliberalism

According to the concepts of neoliberalism, the economic policy highlights the fact that the flow of the economy needs to be maintained by the desire of expanding the market and intensifying it (Arkorful and Abaidoo 2015). This would result in minimizing the intervention of the government, along with assuring that all the people of the society would be gaining from the globalization.  Neoliberalism often describes the free-market economics and the trade free policies and privatisation. Price deregulation and flexibility of the labour market is also an essential part of the  neo liberal concept (Babb and Kentikelenis 2017). The various examples of the neo liberal approach includes the adoption of the free market policies in Chile in the late 1970s. This also includes, deregulation and reduction in the intervention of the government. Though, this approach assured the people of the society, that the economy is likely to be beneficial for all, however the reality is quite different.  

Advantages of neoliberal approach  

1. Free market: With the neoliberal approach, the free market system was introduced with price deregulation and flexibility in the labour markets. This free market initiated globalization, with market innovation and control (Barker 2014). This is advantageous from the perspective of globalization. Moreover, the free market enhanced trade and commerce thus, giving a boost to the global market.
2. Reduced governmental intervention: The concept of neo liberalism resulted in the reduction in the governmental intervention and control over the global market. Thus, the economy and politics of the world witnessed a new concept, where the control of the market was on the regulators itself. The concept of neo liberalism also resulted in the Free Trade Agreement (FTA), among the various countries. This, the products of one country could be easily traded in the other countries, giving rise to globalization.
3. Economic and political stability: Economic and political stability is achieved with neo liberalism. With FTA and rise of globalization, political stability among the countries, exchanging commodities is achieved. Moreover, the free market resulted in significant rise in the economic condition of the countries around the world, that has been incorporating neo liberalism
4. Improvement in technology and market innovation: The free trade and free market increased the urge of innovation by the rulers of the market. Thus, use of new technologies was introduced in the market, increasing the overall market condition. These new technologies enhanced the overall market condition, thus providing an economic boost.

Disadvantages of neoliberal approach

1. Increase in the gap between poor and rich: Neo liberalism and globalization causes increase in the gaps between the poor and the rich. The increase in the efficiency of the market and the easily availability of trade increases the gap between the rich and poor of the society. While, one group of people has been gaining financially, the other group of people has been in deep poverty. The rich people are becoming richer and the poor is burdened with the economic hardship. Moreover, rise in completion with any governmental control has resulted in the increase in the gap between the individuals and the enterprises (Boratav 2016). This increase in the gaps among the rich and the poor, increased social discrimination in the society, which is not desirable.
2. Provoked destruction in culture: Globalization has been bringing in products of various countries along with the adoption of the culture of the country. This results in provoked destruction of the culture of one country, with which trade relation has been established (Carmody and Owusu 2016). Over-globalization resulted in destruction of the culture of the developing countries, since the market of such countries have been over flooded with the commodities of various foreign lands.
3. Monopoly power: The market has been experiencing increase in the monopoly of one or two market players. With the reduction in the intervention of the government and reduction in the governmental control, monopoly in the market is caused. Thus, the local traders have been deprived. This resulted in the social gaps to increase.
4. Growth of financial flow: With a significant increase in the globalization, the flow of money in the market has been increased. This often results in inflation in the market, causing economic instability.
5. Market fundamentalism: One of the greatest disadvantages of the neo liberal approach is the market fundamentalism. While advocating the usages of the free markets, the critical sector such as education and healthcare is often misplaced. These crucial sectors are not subjected to the same profit motivation. Moreover, the free market often results in ignoring the critic sectors like healthcare, proving detrimental for the society.   

Globalization

One of the greatest effects of neo liberalism is globalization. Globalization refers to the concept of free trade and exchange of commodities for the purpose of trade and commerce. With the advent of globalization, free trade, free market and enhancement of economy has been witnessed (Ozer and Schwartz 2016). The concept of globalization is closely related to the concept of neo liberalism. Neo-liberalism ensures that globalization and free trading is caused assuring the benefit for all the people of the society. However, in the real world both neo-liberalism and globalization fails to benefit all the people of the society (Vassallo 2015). The advantages and disadvantages of globalization, in contexts to the offered benefits for all the people of the society have been mentioned below.

Advantages of globalization

1. Opens acceptance among the people of various nation: One of the greatest advantages of globalization is the acceptance of the culture of people of various nations. The people of the country might adopt the culture of other countries, thus enriching the culture of both the countries. This is essential in creating society with free access to the commodities of the world.
2. Offers global market: Free trade among the countries enriches the global market and the global economy. The products that were not available in one country could be procured from other country, with which free trade agreement is signed (Dalton and Rama 2016).
3. Rise in the wages of the unskilled labours: The unskilled labours experience increase in their wages since new avenues if trade are opened as a direct effect of globalization (O'Malley 2016).
4. Foreign direct investments: Globalization welcomes foreign direct investments in various sectors such as healthcare and education. Thus the enhancement if these crucial sectors is caused as a direct effect of globalization. With the foreign direct investment, the crucial sectors are benefitted and enhanced technically.

Disadvantages of globalization

Along with various advantages of globalization, there are certain disadvantages. These are as follows:

1. Unprecedented speed in human lives: Globalization has brought with itself unprecedented speed in the human lives of the people of the society (Larson 2016). This speed results in the increase in the mobility and decrease in the quality of human lives. Thus, economy and society might face lack of balance.
2. High competition: The rise of competition from the foreign trades resulted in very high competition, thus the local trades ceased to survive. The competition is so high that local traders fail to survive the speed and rise in competition (Davidson et al. 2014).
3. Invasion of infectious diseases: With the exchange of commodities, goods and traders, infectious diseases are also brought in to the countries, thus putting the lives of the people of the nation in stake (Metz 2013).
4. Migration of population: People from the developed countries often travel to the developing countries for setting up their business in those countries (Hirst, Thompson and Bromley 2015). Migration of the people in a huge number might cause degradation of the lives of the local people.
5. Decline in the balance of the society: With the rise of globalization, the economic gap between the rich and the poor has been rising constantly (McNabb 2015). Thus, the balance of the society is somewhat lost. Thus, the rich people is becoming richer and the poor people is becoming poorer.

Hence, as seen, the concept of neo-liberalism and globalization promised to bring in a revolutionary change in the lives of the people, along with the assurance of giving advantage and benefit to all people of the society. However, in reality, the gap between the poor and the rich has been rising.

Conclusion

Neo-liberalism and globalization has indeed brought in revolutionary changes in the society all around the world. It is true that the economy of the world has increased and stabilized due to globalization. However, the expectations that people had from the two concepts were not fulfilled, as these concepts were focused to make the poor people rich. However, in reality, the rich people became richer, and the poor people remained under the burdens of poverty. Thus, these two concepts were designed to achieve a specific goal. Yet, it ended up in having a different effect on the society, that might prove to be an adverse one, for the economy of the society.

References

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Babb, S.L. and Kentikelenis, A.E., 2017. International financial institutions as agents of neoliberalism. The SAGE handbook of neoliberalism. Thousand Oaks: SAGE Publications.

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Boratav, K., 2016. The Turkish Bourgeoisie under Neoliberalism. Research and Policy on Turkey, 1(1), pp.1-10.

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McNabb, D., 2015. The role, advantages and disadvantages of regulating social work education in Aotearoa New Zealand.

Metz, F., 2013. Globalization. Advantages and Disadvantages.

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Ozer, S. and Schwartz, S.J., 2016. Measuring globalization-based acculturation in Ladakh: Investigating possible advantages of a tridimensional acculturation scale. International Journal of Intercultural Relations, 53, pp.1-15.

Vassallo, S., 2015. A critical consideration of the alignment between the discourse of self-regulated learning and neoliberalism. Emotional and Behavioural Difficulties, 20(1), pp.82-97.