For good or ill, globalization has become the economic buzz-word of the 1990s. National economies are undoubtedly becoming steadily more integrated as cross-border flows of trade, investment and financial capital increase. Consumers are buying more foreign goods, a growing number of firms now operate across national borders, and savers are investing more than ever before in far-flung places.
Whether all of this is for good or ill is a topic of heated debate. One positive view is that globalization is an unmixed blessing, with the potential to boost productivity and living standards everywhere. This is because a globally integrated economy can lead to a better division of labor between countries, allowing low-wage countries to specialize in labor-intensive tasks while highwage countries use workers in more productive ways. It will allow firms to exploit bigger economies of scale. And with globalization, capital can be shifted to whatever country offers the most productive investment opportunities, not trapped at home financing projects with poor returns.
Critics of globalization take a gloomier view. They predict that increased competition from low-wage developing countries will destroy jobs and push down wages in today’s rich economies. There will be a race to the bottom as countries reduce wages, taxes, welfare benefits and environmental controls to make themselves more competitive. Pressure to compete will erode the ability of governments to set their own economic policies. The critic also worry about the increased power of financial markets to cause economic havoc, as in the European currency crises of 1992 and 1993, Mexico in 1994～1995 and South-East Asia in 1997.
National economies are becoming more integrated as a result of ().
A. increasing flows of cross-border trade, investment and financial capital
B. more and more consumers going abroad to buy goods
C. many companies establishing new businesses
D. savers investing more in developed areas than in developing countries
