During the last few decades the global economic landscape has significantly changed due to globalization. Globalization is the multifaceted process that increases the interconnection between the economies in terms of trade, capital and culture. Globalization has a profound effect that has experienced all the nations across the globe. An increase in the exposure to the global economies and the interconnectedness among the nations facilitate to enhance economic prosperity, promote economic prosperity, accelerates economic development. On the other hand, there are many adverse consequences of globalization primarily experienced by the emerging economies. Globalization is associated with the issues of economic inequality, cross border crime, terrorist act, economic dependence, and environmental degradation, risk of macroeconomic volatility, spread of disease and erosion of cultural identity.
This paper attempts to provide a conceptual framework on both the positive and negative impacts of globalization in the context of developing economies.
Globalization has a significant contribution for achieving significant economic growth particularly in developing countries. Globalization in terms of trade liberalization and foreign direct investment has created unique opportunities to emerging economies and promotes sustainable growth and development. Empirical data and statistics provide substantial evidence that exposure to global economy has significantly boosted the economic growth in many developing countries especially in Asian countries like China, India , Japan and Singapore. China and India together account for 6.4% of the total world output and integration into global economy plays a vital role behind it. Most of the nations in the world embrace the changes associated with globalization and growing number of policies are implemented to increase the global integration.
However, globalization, on the other hand is recognized as a highly uneven process where all the nations are not able to enjoy the potential benefits equally.