Essay: Loss American Comparative Advantage Globalization

Politics / Samples May 9, 2011

Sample Essay

Different countries are considered at the winning end because of globalization and organizations are getting competitive advantage just because of globalization but researchers depict that Americans and their organizations are not favoring from this phenomenon. The employees of American organizations started to fret about the issue of globalization nearly three years ago.

They believe that although companies and corporate sector is flourishing because of globalization but individuals in the United States are experiencing job losses because companies are hiring low cost labor from India and China. These losses of jobs and lower wages in the economy are an offset for the entire economy and this strategy would have a long term negative effect on economy of United States. China is emerging as a powerhouse in the globalization arena and it is the most benefitted country when it comes to globalization. The Chinese products are exported nearly everywhere in the world and they are slowly and gradually capturing the market share of different US organizations (Hitt, Ireland and Hoskisson). This strategy of low cost operations is quite beneficial for the Chinese and they are on a winning streak because of this strategy. The strategy formulators are not focusing on this issue and the jobs related to programming, engineering and other white color highly paid jobs are moving towards countries like India, China, Canada and Philippines. The economists believe that US is losing is strategic advantage and its corporations are following the strategy. However, the best strategy in these circumstances would be to employee your own people and attain a sustainable competitive advantage in such a way that it cannot be copied by other producers and especially by Chinese producers. This strategy is favorable for the US in both the short and the long run.