One of the issues of maximum interes to our century is the analysis of implications of globalization on the world economy and this proves to be even more important now in the middle of financial crisis. Forecasts from the World Bank are very optimistic oglobalization, crisis, developed countries, developing countries

Culita Gica Gherghina

Niculcea Silviu Petrisor

English

Research Papers in Economics

139 
 
IMPLICATIONS OF GLOBALIZATION ON THE WORLD ECONOMY 
 
Culi ă Gica Gherghina 
Univesitatea  “Constantin  Brâncoveanu”  Facultatea  Management  Marketing  în  Afaceri 
Econonmice Brăila Str. Rubinelor nr 16-18 ggnegrea@yahoo.com 0726149444, 0762383026 
Niculcea Silviu Petri or 
Universitatea „Constantin Brâncoveanu” Pite ti Facultatea Management Marketing în Afaceri 
Economice Brăila Brăila, Str. Rubinelor nr. 18 ucb_braila@yahoo.com 
 
One of the issues of maximum interes to our century is the analysis of implications of globalization on the 
world economy and this proves to be even more important now in the middle of financial  crisis. Forecasts 
from  the  World  Bank  are  very  optimistic  on  achievemen  sot,  we  wanted  to  emphasize  that  opimiste 
feedback on the evolution of the global economy even when the crisis started in America to carry roller. If 
globalization is responsable for most of the generating causes of the crisis remains to be analyzed in the 
paper where I tried also to propose some measures that make it necessary to work for all the world 
countries, both developed and developing. 
 
Keywords: globalization, crisis, developed countries, developing countries 
 
F02 
 
To have power, being powerful is the desire of the moment, more than ever. Ways to obtain 
power, however, differ, depending on the elements and tools available
75.  
The phenomenon of globalization is and will continue to be at the center of the economists 
preoccupation and in the future is very important to analyze the implications that they generate, 
and  will  generate  at  the  level  of  world  economy  as  a  whole  and  on  different  categories  of 
countries.  
Peter F. Drucker, the "father of management," says: "the best way to predict the future, is to 
create it". Starting from this premise, the World Bank, in the report, Global Economic Prospects - 
Managing  the  Next  Wave  of  Globalization
76,  conduct  an  analysis  of  the  phenomenon  of 
globalization and its influence in the coming years. 
According to the report, population growth will be vital for future global events. Current world 
population of 6.5 billion inhabitants, is expected to reach 8.0 billion by 2030, with an average 
growth  of  60  million  people  annually.  Over  60%  of  this  increase  will  occur  in  developing 
countries. Both, the European Union and Japan
77 are expected to decrease in population and 
increases in most developed countries are based on the migration phenomenon. The population of 
the largest countries of the world, China continues to grow but at a pace lower than in other 
developing  countries.  With  a  growth  rate  much  faster,  India,  will  certainly  exceed  China, 
becoming the most populated country of the globe. Labor worldwide will increase from just over 
3 billion, and is currently at 4.1 billion in 2030, with a growth rate higher than population growth.  
Globalization and economic growth will have an uneven impact, resulting in structural changes, 
loss of jobs in certain sectors and regions and remain behind the savings. Increased per capita 
income on average by 3.6% per year, what will happen in developing countries, will be unequal 
regions, with higher values in South Asia and Eastern Europe. That income distribution will be 
characterized, further inequality, being influenced by equipping households but also by sectorial 
                                                       
75  Gica  Gherghina  Negrea  (Culi ă)  –  South-South  Cooperation  (PhD  Thesis),  Tribuna  Economică, 
Bucharest, 2007, Introduction. 
76 www.worldbank.org/gep2007 
77 From 128 millions in 2005 to 117 millions in 2030. 140 
 
changes caused by migration from rural to urban areas or from countries with low incomes to 
those with high incomes.  
As  regards  employment,  it  is  expected  that  the  segmentation  of  the  labor  market  of  the 
agricultural and non-agricultural (especially for unskilled workers), due to urban migration from 
the rural areas in search of jobs paid better. This will cause an upward trend of wages in rural 
areas, exceeding the growth rates of urban employment, a phenomenon that would not occur in 
the absence of rural-urban migration. The report suggests that this would be the determining 
factor of decreasing the share of workers in agriculture in the horizon 2006-2030, from 51% 
today to less than 35% in 2030
78. Due to population growth, this means only a slight decrease of 
agricultural labor, but an increase of over 1 billion people of the city.  
Another  problem  in  determining  income  distribution  is  changing  so-called  "primary 
qualification" (skill) which, according to the report, shall be determined by reporting wage skilled 
workers in the unskilled workers. According to study authors, the share of skilled workers is 
approximately 32% in developed countries and only 10% in those in development. It is expected, 
also an increase skilled workers.  
The report estimated about Millennium Development Goals, global poverty will be reached in 
2015 at 11.8% versus 20.2% in 2003. It provided that purpose, was somewhere below the 14%. 
Poverty will be reduced in most regions, except Sub-Saharan Africa. Until 2030, the percentage 
of those who live under $ 1 per day would represent nearly 8% of the population in developing 
countries, ie almost 55 million people and world production will increase from 35 trillion dollars 
in 2005 to 72 trillion dollars in 2030 (at the exchange rates and constant prices), with an average 
increase of 3% - more specifically, 2.5% in high income countries and 4.2% for developing 
countries. However, incomes in developing countries in 2030 will represent less than one fourth 
that  of  the  developed  countries.  This  would  mean  that  countries  such  as  China,  Mexico  or 
Turkey, will have an average standard of living of Spain today.  
It predicts that, despite population growth, the number of people living in absolute poverty - with 
less than $ 1 a day - will reach 550 million, from 1.1 billion as at present. Similarly, the number 
of people living with under $ 2 per day can reach from 1.9 billion to less than 800 million 
inhabitants. In conclusion, it is considered that poverty will decrease, despite population growth.  
Developing countries, once considered as "periphery" of the global economy, will become the 
"engine" of the global economy. Share in world production will increase from a fifth currently in 
third in 2030.  
Global economic integration will enter a new phase. The share of trade in GDP in all developing 
economies will increase and services will be the most dynamic in the next 25 years.  
One of the problems facing humanity already, and it appears that will have an important impact 
on the world we live in 2030, is the degradation of the environment. If income inequality and 
poverty  is  central  to  debates  about  the  effects  of  globalization,  the  issue  of  energy  and 
environmental impact of carbon should not be neglected, because the long term may increase 
overall problems. Lost from sight during the 90's and early 2000, the energy returns to attention, 
with reported increases in oil prices, and with the alarming manifestations of global warming. In 
our  country,  moreover,  can  be  observed  in  recent  years,  but  especially  this  year,  very  high 
temperatures for the winter, even with more than 7 degrees Celsius, compared to previous similar 
period.  
In terms of future economic growth, averaging 3% per year, a growth of energy consumption 
with an average of 2% per year. It is assumed that this growth will generate more than one price 
increase of 1.4% per year. Demand for gas, tends to increase, exceeding the one for oil and coal, 
as the policies and technologies tend to focus to the less polluting fuel. As a result, noted the 
                                                       
78 Gica Negrea (Culi ă) – Globalization – long term forecasts of the World Bank, Tribuna Economică, nr. 
8-2007. 141 
 
attempts of Russia, the country with the largest reserves of gas and the main supplier of the 
European Union not only to increase the price of methane gas. Renewables (wind, the tides, 
solar, etc..) and nuclear energy, tend to increase the share in consumption, but are far from able to 
meet requirements. Adoption widespread need imposed by the introduction of charges for the use 
of polluting fuels and stimulate investment in energy technologies, to facilitate their use.  
Stagnation  or  even  decrease  in  production  in  developed  countries  and  growth  in  developing 
countries will lead to changes in trade in fossil fuels. The effect will be produced mainly as a 
result of selling of highly-polluting technologies from developed countries to developing ones, 
that are enjoying now the "unconscious" benefits of industrialization.  
Of course, these forecasts may be affected long term by a series of internal factors, especially 
macroeconomic policies chosen and external – like world crisis. The authors report helps ensure 
that it took into account the influence of periods of recession, regional conflicts or crises similar 
to those with which the world has faced over the past thirty years. Proved that the world economy 
has  increased  during  1980-2005,  despite  some  major  events:  the  crisis  of  external  debt  of 
countries  in  Latin  America,  the  disintegration  of  the  Soviet  Union,  the  Asian  crisis  and  the 
tragedy of 11 September 2001. These events have had only short-term effects on global growth 
and  have  very  little  influence  on  the  evolution  of  the  phenomenon  of  globalization  of  the 
economy. Unfortunately, the situation had thought might be even better than forecasted, taking 
into account the possible discovery and implementation of technology and innovation business, 
which could accelerate globalization.  
But  now  the  world  faces  one  of  the  biggest  world  crises.  This  was  not  foreseeable  by  any 
company profile and so the global confidence in these companies dropped a lot. Predictions seem 
to crash, pessimism overtake the most optimistic of analysts and lack of trust prevails. 
In conclusion, the world in 2030 will depend on the choice of the Member: will choose managed 
globalization or direct it. To be prepared to We are the economic policies required to bring "poor 
world" on the road to economic growth through investment in education, infrastructure, human 
resources development, by accepting change, not through resistance to change.  
Necessary so the following measures:  
- and increase the grant amounts provided as development assistance to mitigate the negative 
effects of globalization; 
- global trade liberalization in the World Trade Organization, can generate opportunities for poor 
countries. The most important task in this respect is the resumption of Doha Round and achieving 
an agreement to reduce trade barriers for products in world development, especially agriculture 
and the intensive manufactured;  
- creation and development of international mechanisms to provide the necessary resolve any 
disputes.  
But more important than any measures that would be the world to work together to find solutions 
to implement them seriously so that the global economic crisis effects to be less negative impact 
on the countries. 
„In this era of globalization, advanced technology and a global economy tripolare, developed 
countries, in transition or developing - have made an essential - that import substitution is not the 
solution. It seems that there are solutions which differ Raul Prebish's view, but offers hope of 
solving the problems of countries in the periphery of the global economy. Globalization is here 
and will remain, must accept that, but current world order should be channeled to the developing 
world, through joint efforts”
79.  
 
   
                                                       
79 Professor Lawrence R. Klein - South and East Asia: Leading the World Economy,  13th Raúl Prebisch 
Lecture, United Nations Conference on Trade and Development,  Geneva, 2 November 2005, pag. 3. 142 
 
Bibliography 
1.  Gica  Gherghina  Negrea  (Culi ă)  –  South-South  Cooperation  (PhD  Thesis),  Ed.  Tribuna 
Economică, Bucharest, 2007. 
2.  Gica  Negrea  (Culi ă)  –  Globalization  –  long  term  forecasts  of  the  World  Bank,  Tribuna 
Economică, nr. 8-2007. 
3. Lawrence R. Klein - South and East Asia: Leading the World Economy,  13th Raúl Prebisch Lecture, 
United Nations Conference on Trade and Development,  Geneva, 2 November 2005. 
4. www.worldbank.org/gep2007 

(Culi ă) – Globalization – long term forecasts of the World Bank, Tribuna Economică,

Leading the World Economy,

IMPLICATIONS OF GLOBALIZATION ON THE WORLD ECONOMY

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IMPLICATIONS OF GLOBALIZATION ON THE WORLD ECONOMY

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