Lesson 18 — Activity 3: Expansion of Economic Globalization


Warm Up


The expansion of economic globalization increased greatly after the Second World War. After the War, a large part of Europe and parts of Asia were damaged by the fighting and devastation, and the economies of these continents suffered. The United States, on the other hand, profited from the war. They did so by lending money to other countries and selling them military equipment and supplies. 



In this activity, you will learn more about the expansion of economic globalization. 


     
Source: Pixabay.com









During the 1950s, lending rates of the banks were quite low and government-sponsored programs encouraged many people to buy houses. This spending boosted the North American economy.

 The emergence of television (and television advertising) further boosted consumption and the economy of North America. Soon large companies developed and began looking for foreign markets to sell their products to.

Source: Pexels.com


Source: Pixabay.com




Then computer technology developed, which helped increase the manufacturing of goods, and bigger factories were built, especially in poor countries where labour costs were low.

Following that, there was the rise of the Internet and satellite technology.


This technology really improved the ability to communicate cheaply and quickly, and this opened world markets to any company with a website.

Countries began signing trade agreements and working with other countries with similar interests (e.g., the North American Free Trade Agreement).


Different people and organizations have different ideas about the
economic effects of globalization.

Here are some examples:

Environmentalists:

  • are concerned about the impact of economic globalization on the environment; e.g., deforestation, mining runoff,  and big industry pollution

Source: Flickr.com CC BY 2.0


Unions:

  • are concerned with the loss of local jobs to inexpensive labour in other countries, imported workers who work for less money, and the reluctance of multinational companies to allow workers to unionize

Source: Pixabay.com


Human Rights Organizations (e.g., Amnesty International, International Red Cross):

  • are concerned with the treatment of people by big business, which is sometimes driven by economics, rather than concern for the well-being of people

Source: Wikimedia Commons


Self-check!

Try This!


Answer the following questions regarding the expansion of the global economy.

1. How did the United States profit from the Second World War?

2. How did the rise of the Internet affect the global economy?

3. What is one reason that unions are concerned about the expansion of the global economy?



1. The United States profited from the Second World War by lending money to other countries and selling them military equipment and supplies.

2.   The Internet really improved the ability to communicate cheaply and quickly, and this opened world markets to any company with a website.

3. Unions are concerned about the expansion of the global economy because of these reasons:


  •  the loss of local jobs to inexpensive labour in other countries
  • imported workers who work for less money
  • the reluctance of multinational companies to allow workers to unionize




Digging Deeper!

You learned previously about trading that is done between countries in the world.

 Have you heard of Fairtrade? 
 
Fairtrade is another approach to conventional trading and is based on a partnership between producers and consumers. When farmers can sell on Fairtrade terms, it provides them with a better deal and improved terms of trade. Fairtrade offers people who buy Fairtrade products a powerful way to reduce poverty through their everyday shopping.

Click on the Play button to watch a video from Fairtrade Canada that explains more about Fairtrade products.