Effects of Economic Globalization

Effects of Economic Globalization

Globalization has led to increases in standards of living around the world, but not all of its effects are positive for everyone.


3 - 12


Social Studies, Economics, World History


Bangladesh Garment Workers

The garment industry in Bangladesh makes clothes that are then shipped out across the world. It employs as many as four million people, but the average worker earns less in a month than a U.S. worker earns in a day.

Photograph by Mushfiqul Alam
The garment industry in Bangladesh makes clothes that are then shipped out across the world. It employs as many as four million people, but the average worker earns less in a month than a U.S. worker earns in a day.
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Globalization is how different parts of the world are connected. People, ideas, and goods move more easily around the world than they did in the past.

Globalization also changes the way companies and countries trade with each other. This shows how globalization affects economies. Globalization has improved people's lives in poor countries. However, globalization sometimes doesn't bring new jobs or money to other countries.

Globalization in the Past

Globalization is not new. People have always traded goods with their neighbors. At one point, people began traveling to distant places. People traded their own goods for other products.

The Silk Road is an example of early globalization. The Silk Road was an old system of trade routes. The routes connected the continents of Europe, Africa, and Asia. China is a country in Asia. The Silk Road was helpful because there were no trains then. Europeans traded products made of glass and other goods for Chinese silk and spices.

Later on, trade developed between Europe, Africa, and America. Sadly, most of it involved slavery. This showed how globalization can truly hurt people. European ships carried products from Europe to Africa. In Africa, the products were traded for enslaved Africans. These enslaved Africans were then forced to go to the Americas. From the Americas, the ships carried raw materials like sugar, tobacco, and cotton back to Europe. In Europe, the raw materials were used to make products. Then those products were brought back to Africa again. The cycle started over. This cycle was called the Triangular Trade.

Globalization has grown in recent years. It is easier to send money and products to other countries. It is simpler for companies to contact other countries. Countries signed agreements that make it all easier for them.

Benefits of Globalization

Globalization gives large companies an advantage. Companies can get materials for less money in poorer countries. They can pay less money to workers in those countries.

Also, different parts of a product may be made in different countries. T-shirts made of cotton are one example. Cotton is a plant. It might be grown in one country. Then, in another country the T-shirt is woven from those pieces of cotton.

The result is more jobs in countries where jobs are needed. More jobs make people's lives more comfortable. People who buy the products are doing better, too. In general, globalization makes prices of goods lower. For example, globalization makes t-shirts cheaper. Also, there are more goods for people to choose from.


Not everything about globalization is good. Many jobs were moved to different countries. The people who had those jobs before were left without jobs.

In poorer countries, the working conditions of people are often very difficult. People there are paid very little for a whole month of work. A worker in the United States may get more money in one day than they do in a whole month. Also, children of poorer families may quit school so they can work.

Into the Future

Globalization is not perfect. However, globalization will continue. The result is a more connected world.

Media Credits

The audio, illustrations, photos, and videos are credited beneath the media asset, except for promotional images, which generally link to another page that contains the media credit. The Rights Holder for media is the person or group credited.

Tyson Brown, National Geographic Society
National Geographic Society
Production Managers
Gina Borgia, National Geographic Society
Jeanna Sullivan, National Geographic Society
Program Specialists
Sarah Appleton, National Geographic Society, National Geographic Society
Margot Willis, National Geographic Society
Clint Parks
Last Updated

February 20, 2024

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