Disadvantages of Globalisation

1. Instability in the Market:

The removal of trade restrictions and increased freedom of movement are cited as reasons why national policies and regional cultures are being undermined by proponents of globalisation. Labour markets are impacted when people cross borders in quest of higher-paying jobs or when businesses outsource work and positions to cheaper labour markets.

What is Outsourcing?

One of the significant effects of globalisation is outsourcing. Outsourcing is the practice of contracting out third-party activities that were previously handled by the organisation. For instance, many businesses now contract with other organisations to provide security services. Due to the development of faster methods of communication, especially the development of information technology, it has become more intense in recent times. Modern telecommunication systems allow digitized text, speech, and visual information related to these services to be transmitted in real-time across continents and national boundaries.

2. Causes Environmental Damage:

Transporting products and people across borders releases greenhouse gases and has a negative impact on the environment. Industries like fishing and logging frequently relocate to areas with the best economic opportunities or rules, which has led to overfishing and deforestation in some regions of the world.

3. Encourages Worldwide Economic Recessions:

A greater likelihood of global recessions exists in tightly integrated global markets. A good illustration of how interconnected global markets are and how financial issues in one country or region can quickly influence other parts of the world is the 2007–2009 financial crisis and the Great Recession. The ability of individual countries to effectively use monetary and fiscal policy to govern the national economy is diminished by globalisation.