Globalization is a phenomenon that started in a primeval form in the last half of the 20th century, and has briskly and steadily advanced in recent times, due to rapid technological advancements. International boundaries have become almost non-existent as multinationals are using strategies to expand their scales of operations worldwide. The socioeconomic, technological, and political environments have further aided in such expansions as such environments have become more supportive of international business activities. While multinationals often propagate globalization basing their argument on the claim that it helps developing countries economically, socially, and politically, the reality is that outsourcing of production activity, which is a critical aspect of globalization, is not good for developing economy because it exhausts the environment and labour while all the benefits or profits are enjoyed by the developed countries. Thus widening the gap between the rich and the poor. .
While globalization creates different opportunities and opens the markets in developing countries, it exacerbates income inequalities within developing countries and between industrialized and emerging economies (Dasgupta & Nederveen, 2009). In a research conducted by Adelman (2005) to determine the impact of globalization in 42 nations, it was uncovered that the per capita GDP of developed nations such as Japan, Denmark, and Finland increased by €1,000 yearly as a result of globalization. Sadly, per capita GDP of developing nations such as India, South Africa, Brazil, and Mexico increased by approximately €100 only. Germany, for instance, earns an extra €2 trillion as a result of globalization. Similarly, developing nations gain differently from globalization (Dasgupta & Nederveen, 2009). This increases the income imbalance. Consequently, the poor countries continue being poor while the developed rich countries continue progressing from proceeds generated in the developed countries.
