Globalisation & Trade Restrictions

A rise in globalisation has wide effects, and most of them cut both ways.

• International trade. Trade grows as barriers fall and supply chains spread across borders, raising output and incomes.
• Competition. Domestic firms face more foreign competition, which can lower prices and raise quality, but can also drive less efficient domestic firms out of business.
• The environment. More production and longer transport chains can raise pollution and emissions, though the spread of cleaner technology can work the other way.
• Migration. Easier movement of people lets workers go where jobs and wages are higher, helping fill labour shortages but also straining housing and services in receiving countries.
• Income distribution. Globalisation has lifted hundreds of millions out of absolute poverty, but within countries it can widen the gap between skilled workers and capital owners, who gain, and low-skilled workers in import-competing industries, who may lose out.
• Economic development. Access to world markets, foreign investment and technology can speed up development in poorer countries, although those that stay dependent on a narrow range of primary exports benefit less.