How Globalization Has Affected The Economy of Japan
The term globalization refers to the process of integration and interaction among companies, people, and governments of different states that take part in investment and trade with the aid of modern technology. Globalization, impacts the lives, environment, economic development and political system of a nation. This process has been made possible by modern technology that has made the world a global village where businesses use computers to run foreign branches with much ease. Therefore, this paper is going to look at the effects of globalization on the economy of Japan and its automobile industry. In short the paper is going to highlight and discuss the advantages and disadvantages associated with globalization in the economy of Japan.Globalization has led to increased opportunity for Japan investors in foreign countries. With advanced technology in Japan’s automobile industry, investors have had a chance to participate in international trade with counterparts in other countries (Spatz & Nunnenkamp, 2002). This has greatly benefited the economy of Japan as they can tap foreign income by selling automobile products in international markets. Also, Japan-based dealers have been able to open new branches in foreign countries, and they use technology to manage their business, which improves the country's economy.
Also, globalization has enabled Japan to access resources and labor from foreign countries for the automobile industry. Since trade has been globalized, the industry can seek the service of experienced workers from other nations (Bruno, Falzoni, & Helg, 2003). This has helped the car industry to come up with tremendous improvement in their services and product since they attract qualified workers. In turn, this boost the economy of Japan as the goods produced by experienced workers are exported to international market hence earning the country foreign revenue. Also, globalization has helped to boost the growth of the automobile industry since businesses can get access to resources used in the companies from overseas markets. This is important to the economy of Japan, as there will be no shortage of resources in the automobile industry. This implies an increase the output.Globalization has led to competitive prices of automobile goods and services in Japan. Since globalization opens space for international trade, many firms dealing with automobile business have opened their shops in Japan. This has led to a stiff competition between the local and foreign companies in the country, resulting in reduced prices of services and products (Fujita, Mori, Henderson, & Kanemoto, 2004). This sometimes knocks some companies from the market since they cannot afford to produce their products at reduced costs as compared to other that operate in large-scale production. For instance, you may find a foreign firm dealing with spare parts in Japan is selling their quality products at a low price as compared to a home company that sales the same products at a higher price (Spatz & Nunnenkamp, 2002). Therefore, most people will tend to go for services and products that are relatively cheaper, making the local …
