Globalization and Canada. Globalization and free trade Essay

Globalization and Canada. Globalization and free trade - Essay Example Globalization of business and economies has changed societies in all countries and Canada is no exception. In fact, the term "global village" to denote the effect of globalization was coined by a Canadian journalist, Marshall MacLuhan at the dawn of the 21th century. Free flow of capital in and out of Canada, free trade and the existence of multinational companies have together linked Canada to the rest of the world's economies. In addition, Canada has become a part of continental integration through the North American Free Trade Agreement (NAFTA) that has already exposed the trading and business community of Canada to the United States. As a result of the interaction of a global business environment and a multicultural population, the Canadian society is undergoing a change that needs to be explored further. Besides, globalization has had an impact on the sovereignty and democracy of the country as Canada's economy as well as its culture has got integrated with that of the United St ates. In this paper, I will discuss the economic, social and cultural effects of globalization on Canada and propose a methodology for further questions.Inter-linkages between economies across different geographies have existed for centuries but it is only recently that the world has become truly integrated into a 'global village' rather than in a state of one group of countries exploiting the other. Capitalism and the Industrial Revolution had its roots in technological innovations like the power looms and railroads in Britain in the middle 19th century but it soon spread across Europe and North America, allowing for growth in commerce (Chirot, 2000). The modernization of the European and North American economies was aided to a large extent on the availability of raw materials (cotton from India in the case of Britain) and labor (African slaves for North America) from the colonies. By the advent of the 20th century, however, the limits of the capitalist development had been reached , leading to the Great Depression of the 1920s in North America and Europe (Giddens, 1986). The two World Wars changed the global economic power balance, with most of the colonies gaining independence over the period and Soviet Russia becoming more powerful and dissociated from the western powers. Post war reconstruction, growing urbanization and technology improvements revived the North American and European economies while Soviet Russia too developed technological capabilities. However, the world got bifurcated between the capitalist (mainly North America and Europe) and the socialist (mainly the USSR) camps while the Third World countries (the developing or underdeveloped nations, most typically erstwhile colonies of European powers) aligned themselves to either of the two camps. The 1950s saw a boom in the United States economy, much as a result of Fordist automation of industries and growth of consumerism, and US multinational companies endeavored to invest in other countries, the nearest neighbor, Canada, being the most convenient. However, in the 1960s and 1970s, even the capitalist economies, Canada being an important example, largely believed in economic sovereignty and foreign ownership was not seen as favorable (Smythe, 2001). The global economic order has significantly changed since the end of the Cold War in the late 1980s. As the divergence of the world between the two superpowers and their respective beneficiaries in the so-called Third World disappeared, the world has now become a 'global village' that is increasingly inter-linked for mutual benefits. The processes of production and consumption have undergone significant globalization, aided be the nearly free flow of capital and technology across political barriers. Over the years, multinational companies (MNCs) have ruled world business and governments have had limited roles to play. A survey by Institute for Policy Studies in 2000 found that the world's top 200