Government Role Globalisation

What Roles Do Governments Play in Hindering/Fostering Financial Globalisation?

What Roles Do Governments Play in Hindering/Fostering Financial Globalisation?

Introduction

Globalisation refers to the spread of new forms of non-territorial social activity. Since the vast majority of human activities is still tied to a concrete geographical location, the more decisive facet of globalisation concerns the manner in which distant events and forces impact on local and regional endeavors (Jan, 2000). In popular discourse, globalisation often functions as little more than a synonym for one or more of the following phenomena: the pursuit of classical liberal or free-market policies in the world economy; the growing dominance of Western forms of political, economic, and cultural life; the proliferation of new information technologies; as well as the notion that humanity stands at the threshold of realizing one single unified community in which major sources of social conflict have vanished. This paper discusses the roles of Governments in hindering/fostering financial globalisation in a concise and comprehensive way.

Roles Do Governments Play in Hindering/Fostering Financial Globalisation?

Globalisation is the result of advances in communication, transportation, and information technologies. The impact of recent technological innovations is profound, and even those who do not have a job directly affected by the new technology are shaped by it in innumerable ways as citizens and consumers.

Globalisation, in its rightist sense, also involves the growth of multinational corporations or transnational corporations, and international institutions that oversee world trade and finance play an increasingly important role in this era of globalisation (Jan, 2000). Globalisation shares a number of characteristics with internationalization and is used interchangeably with it, although some prefer to use globalisation to emphasize the erosion of the nation-state or national boundaries. Globalisation has become identified with a number of trends, most of which have developed since World War II. These include greater international movement of commodities, money, information, and people, and the development of technology, organizations, legal systems, and infrastructures to allow this movement (Jessop, 1995).

Very few people, groups, or governments oppose globalisation in its entirety. Instead, critics of globalisation believe the way globalisation operates should be changed. The debate over globalisation is about what the best rules are for governing the global economy so that its advantages can grow while its problems can be solved. On one side of this debate are those who stress the benefits of removing barriers to international trade and investment, allowing capital to be allocated more efficiently and giving consumers greater freedom of choice. With free-market globalisation, investment funds can move unimpeded from where they are plentiful to where they are most needed (Loader, 2000). Consumers can benefit from cheaper products because reduced tariffs make goods produced at low cost from faraway places. Producers of goods gain by selling to a wider market. More competition keeps sellers on their toes and allows ideas and new technology to spread and benefit others.

On the other side of the debate are critics who see neoliberal policies as producing greater poverty, inequality, social conflict, cultural destruction, and environmental ...