Globalization and Globalization Is the Reason for Trade
Essay title: Globalization and Globalization Is the Reason for Trade
Trade is the reason for GLOBALIZATION AND GLOBALIZATION IS the REASON FOR TRADE
WHAT IS TRADE
Trade can be termed as a means of exchange of goods and services. According to the Oxford dictionary it is:”the activity of buying and selling or exchanging of goods and services between people and companies.” For trade to exist there has to be a buyer and a seller, or rather an entrepreneur and a market. An entrepreneur is the individual or company that provides or produces such a goods or a service.
WHAT IS GLOBALIZATION
Globalization according to the Encarta dictionary: “means to become adopted on a global scale, or cause something, especially social institutions, to become adopted on a global scale.” Simply put, it is making the entire world a field or business environment for the entrepreneur to perform is trade. It is a term used to describe a companies operation around the world. According to Professor C.S Ige of Covenant University it is “a concept that deals with the idea of countries free trading with them.
Trade is the reason for globalization
The job of an entrepreneur as a member of the factors of production is to combine all the other factors of in an optimum way to yield maximum profit. Entrepreneurship is all about trading to yield maximum profit. It all starts with an idea or an innovation which leads to production of either services or goods. Since the original intent and goal of any producer is to maximize profit, this creates a drive for him, i.e. he tries to increase his capacity and thus create more goods in order make more profit. To achieve this he seeks a new, better and efficient ways to combine factors of production, he could also seek new production techniques or better still, a new invention all together. This unending quest which increases efficiency in production and eventually culminates into an increase in the volume of goods and services needs a larger market, such a market is usually sought outside the original shores of the producer. This goes on till the operations of such a company covers the entire globe. This is when trading leads to globalization.
GLOBALISATION IS THE REASON FOR TRADE
Globalization according to Barry Bosworth and Philip H. Govon of the Bookings institute:”globalization is the expansion and the intensification of linkages and flows of people, goods, capital, ideas, cultures, across national boarders. They refer to this term as nothing new due to the existence of large trading companies in the 16th century whose major force(for increase) were the technological advances that increased the speed and the cost of communication