Global Context Of Modern Business Essay Example | Topics and Well Written Essays - 2500 words

Global Context Of Modern Business - Essay Example Globalization is increasing the interdependence among the economies. However, the developing countries are enjoying increasing access to markets of developed economy that facilitates easy transfer of technology and capital movements but it is increasing the inequality among the global economies. The negative aspect of globalization is that instability or downturn in any major economies of the world results in the downturn of the global economy as a whole. This is because the domestic economic developments of countries determined not only by the domestic policies but also by international policies and economic situations. Thus in order to implement any developmental policies not only the domestic impact but also the global impact of that policy has to be considered (Balakrishnan, 2004). Moreover globalization may create more unemployment problems because of increasing firm closure and lower wages of the employed. This is because increasing competition often wipes out the small firms t hat are incapable to compete and secondly more use of modern and advanced technology in production adversely affects some companies manufacturing unimproved machineries (Moffatt, 2011). There is coexistence of both positive and negative impacts in every aspects and globalization is no exception. Thus to study modern business in the global context the most important issue that need to be considered is the impact of the global financial crisis which triggered the global economy during 2007. Globalization has increased the financial movement across countries because of lucid monetary controls and regulations and thus financial globalization is associated with the financial crisis of 2007. The paper discusses the nature and impact of the crisis on the countries’ business environment. The Financial crisis – nature and impact The people of topical times are still living with the recollections of the Great Depression of the 30s. There has been no record of economic avalanche of same scale and duration till this date, but the recent global financial crisis is not less important. The economic recession of 2007 has already found its position in the records of American politics. It is less brutal than the great depression of 1929 but has thrown its shadows on worldwide politics and economy. The crisis of 2007 will be considered as a short follow-up to the 1929 depression. The government policies and concern have been held responsible once again for the financial crisis – â€Å"Americans have lost faith not only in the [Bush] administration, but in its economic philosophy: a new corporate welfarism masquerading behind free-market ideology; another version of trickle-down economics, where the hundreds of billions to Wall Street that caused the problem were supposed to somehow trickle down to help ordinary Americans. Trickle-down hasn’t been working well in America over the past eight years.† (Stiglitz, October 2008) The social, political and economic perils of the global financial crisis of 2007 will continue to persist for another few months. The American government and European Union have thrived for a united effort to counter the recession. It seems like a group action on the part of the national leaders will be more valuable in restoring the backbone. The world has altered a lot since the Second World War. The harmony among different nations and their joint effort to expand the world as a whole had come