The Changing Demographics of the Global Economy

The Global Economy
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Abstract
Over the years international trade has evolved into a sophisticated element thanks to development of trading policies and integration of services across the global platform. Before the First World War, most of the national economies relied on immobile factors of production, however after the war most of the factors of production became mobile. Elaborate networks were also developed ensuring proper integration of services. As such, the global economy is a mesh of interconnected economies at the national level. This means that if one of the economies is affected by financial difficulties the rest of the countries highly dependent on the same are bound to suffer (Hill, 2015). Globalization of the trading system has allowed economies to outsource goods and services that they do not produce in plenty or have limited capabilities to do produce. This has led to the formation of the global trading system, where countries rely on one another. However there are some ethical issues associated with the international trade; among them exploitation of the weaker economies, pollution and dumping among other vices (Hill, 2015). This paper evaluates the demographics of global economic trade and the ethical implications.
Introduction
The global economy has continually evolved over the last century, with much of the changes coming from innovation, technology and social political issues. As a result, there have been changes in demographics of the global economy (Hill, 2015). The global markets have experienced low cost in communication networks such that people can easily interact with one another across the globe creating a global communication mesh. Innovation and technology have also played a great part in the development of the global economies. As countries adopt technology, they develop their industries and ability to connect with other countries outside their economies (Hill, 2015). Using technology, it is now much easier for companies to source markets and labor among other aspect of business processes. As a result, large and small companies now have a level playing field to expand to other uncharted territories. In the past, western companies and by extension the western nations have been at the helm of the global economy. Although they are still leading in a number of elements, there are some upcoming economies that have in the past been relegated to the lower tiers of the third world.
Countries such Brazil, Taiwan and China have been poor performers in the past but are now rising to the occasion and taking a leading role. At the moment china’s is economy is the fastest growing in the world. If this trend in China continues for another two decades, it is going to be at the top of the most powerful economy in the world and will have risen to the top faster than japan. Out of the largest multinational corporation in the world economy have in the past come from the western nations with America leading the pack followed closely behind by Europe (Hill, 2015). However, companies from emerging markets such as china have also made their way to the top. It is also no longer a norm that only the largest corporation that make the largest impacts within the global economic stage as mini-multinationals are also making massive strides. Countries that have previously embraced communism have also changed and adopted capitalism, china being one of them. It is however crucial to note that despite the various projections that can be made relative to the current trends, there are risks of associated with the same. The paper evaluates the various demographic changes that have taken place at the global economic front, relative aspect such outsourcing, international trading, ethical issues and globalization trading systems (Hill, 2015).
Problem statement
Globalization of the world economies has brought about massive shift in the economic development in various countries. In the past the western nations have been at the top tire of the world economies, but smaller economies are slowly catching up and this could lead to massive shifts in the global economy. It is crucial to understand global demographic economics and the impacts that it has on the rest of the world.
Literature review
Outsourcing
As the world becomes a global enterprise with highly sophisticated connections between people, businesses and governments the global economies have become more reliant on one another more than ever before. Outsourcing is one of the most common development that has engulfed the global economic demographics. Outsourcing basically refers to the element of companies contracting other firms to carry out some of the business processes for them as they concentrate on other agendas (Lach, 2012). It is an aspect that is quite common in the technology spheres among others processes that have in the past been thought of as belonging to the intrinsic processes of business management. Relative to the growth that has been experienced in some of the industries specific to certain countries, outsourcing has become of the most reliable choices in business as it increases the level of productivity and at cheaper costs. I is not entirely limited to companies hiring other companies to do their work but it also common in terms of labor (www2.deloitte.com, 2015). As the world becomes more connected, companies and employees are finding it easy to find work in other countries outside their borders. As companies seek specialized skills in various fields, they are open to the fact that they can get such talents outside their borders and thus contract persons on the global market. Globalization has also ensured that availability of job creation opportunities have increased exponentially (Hill, 2015). This relative to the fact that persons with special skills are no longer confined to their countries in terms of providing services, but rather they can also seek employment in other countries of choice and the companies that they like and would fit in well.
The element of demographic changes is therefore underlined by this element of availability of labor at the global scale, such that nations do not have to limit their labor expertise to their citizens but there can further seek skilled labor globally, bearing in mind the level of skill at this level (Lach, 2012). One of the industries that is highly appreciative of the outsourcing elements is that innovation and technology. More often than not, companies that rely on big data, find it easy to have their data managed by expert companies instead of having in-house arrangements (www2.deloitte.com, 2015). This means that the entire information system management process is outsourced to better equipped companies which strategically specialize in data management. As such, companies that have sought the help of the data management companies delegate the responsibilities of data management and then concentrate on other processes. A company such as IBM has been leading the group offering data storage and management to millions of companies not just in America but also abroad (Hill, 2015). Due to their reliable systems setup and quality guarantees, large multinational corporations trust them with their data for security purposes and general management. Data management especially large and medium corporations can be quite expensive relative to the systems setup and the expertise required to run and maintain the systems. Delegating to a companies with dedicated services ensures that the company gets the best services in the market worth global standards, flexibility as well as security (www2.deloitte.com, 2015).
In the manufacturing industry, different companies have specialized in the specialized in development and manufacturing of specialized parts of a larger component. In the technology sector for example, where large corporations are rushing to produce the next best mobile devices, companies have to concentrate on certain aspects of the devices and delegate some parts to other companies (Hill, 2015). It is common within the technology industry, relative to mobile phones production to have a company outsource their processing chips, touch screens, batteries and cameras among others from specific companies. In the smart phone industry Qualcomm is one of the best companies that specializes in research, development and manufacture of the state of the art processing chips for mobile devices. As such, companies from across the world such Sony, do not concentrate on the manufacture of their own chipsets, but rely on a company such as Qualcomm to provide them with the best processing chipsets for their smartphones. On the other hand, Sony is one of the leading in camera technology and thus it concentrates in the research, development and the manufacture of their cameras. Other companies in the smartphones industry come to Sony for the cameras to put on the smartphones as they concentrate on other aspects of their devices. This is a situation that highly illuminates the element of the global shifts in demographics of the economic front in the world (Hill, 2015).
Outsourcing has become one of the driving forces not just at the individual level but at the global level and has brought massive leaps in growth. Economies are no longer limited in terms of their technology of expertise as they can easily outsource the same from countries that have them or at lower level, companies that specialize in whatever service they seek (Lach, 2012). Most of the western companies have in the past and even in the current times been outsourcing services and labor from the east. Places such as India and china offer preferably cheaper labor and expertise compared to the west relative to strict labor laws in the west. A country such as India offers preferably high quality expertise at slash of the costs that western companies would have to pay worker in their nations. To be able to compete favorably in the global markets, companies therefore outsource labor to other nations that have relatively lower rates to make up for other costs and maximize (www2.deloitte.com, 2015).
Global trading system
Globalization has made it that no one country is self-sufficient, such that every other economy is reliant on another for certain aspects. Relative to the various developments in the last century, countries now rely on one another within the global economy. It is for this reason that when an economic crisis occurs in one country it affects the rest of the national economy within in the global platform. In 2008 and 2009 the financial crisis associated with the American banks offering too much housing finance leading towards a financial bubble caused a global financial crisis. This is an indication of how connected the global economies are and how they all affect one another (Hill, 2015). It is crucial to understand that the basic element of the global economies is not based on the countries but the corporation within their borders that interact with other cu...