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GLOBALIZATION (BENEFITS (2) Accessibility to factors of production (a)…
GLOBALIZATION
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CAUSES
1) Economical
a) Trade liberalization based on comparative advantage to lower costs and increase world efficiency in allocating resources.
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3) Technological
a) To reap internal economies of scale to lower cost of production and general price level. This increases demand for exports and increases export price competitiveness.
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COSTS
1) Brain drain
Especially in poor developing countries, talented people are likely to migrate to developed countries to find better jobs and living standards.
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DEFINITION
Globalization refers to the integration or inter-connectedness of national economies through trade of goods and services such as FDI, capital flows and transfer of technology and labor