Technological Globalization – Examples, Pros and Cons

Technological globalization is one of 8 types of globalization that helps us describe what globalization looks and feels like in the 21st Century.

It refers to the spread of technologies across borders and around the world. This includes both:

  • The spread of technological knowledge (how to create technology)
  • The literal movement of technology around the world (trade in technological goods)

With rapid developments in technological innovations in the 21st Century and increased ease and speed at which we can move technologies across the world economy, technological globalization is occurring at a faster rate than ever.

While technological globalization has been good for many people in developing economies [1], there are also concerns that a digital divide between the rich and poor can make economic mobility (people getting wealthier within one generation) more difficult.

Definition

Technological globalization can be defined as the increasing speed of technological diffusion across the global economy. It refers to the spread of technologies around the globe, and particularly from developed to developing nations.

The global flow of technologies has been extensively researched by Arjun Appadurai who considered technological globalization to be one of five ‘spheres of globalization’. He labelled technological globalization the ‘technosphere’ and explained that it’s both an effect and cause of globalization.

As an effect of globalization, we can see that technologies spread more easily thanks to political globalization (the increased interconnection of nations) and economic globalization (the rise of a global economy facilitated by liberalization of trade). For example, free trade agreements can make it easier to move technologies across borders; and manufacturing in the developing world can make it cheaper to produce those technologies.

But it’s also a cause of globalization because new technologies like the internet and cell phones make it easier to conduct cross-border trade and interactions. Similarly, technologies that have made air flight more efficient have helped increase the flow of people around the world.

Examples of Technological Globalization

1. Growth of Multinational Technology Corporations
Liberalization of trade and economic globalization have facilitated the growth of multinational corporations like Microsoft, Apple and Sony. Traveling around the world, chances are the televisions in all the airports are from one of the four or five major television brands. Anywhere in the world, chances are the phones will be made by Samsung, Apple, or another of the major multinational mobile phone corporations.

technological globalization examples

2. Mobile Banking
Mobile banking has allowed people to access money both at home and around the world at a faster pace than ever. In particular, smartphone stock trading apps allow for the ownership of capital to be shuffled around the world faster than ever, helping to speed up globalization and lower the cost of start-up capital to facilitate new business development.

3. Mechanization of Manufacturing
While not the first thing we think about when considering examples of technical globalization, this is one factor that has an enormous impact on our lives. Using machines for manufacturing lowers labor costs which has two competing effects: downward pressure on labor costs (leading to cheaper goods) and loss of traditional manufacturing jobs.

4. Media Globalization
One effect of the spread of technologies and technological knowledge (primarily from the developed to developing world) has been to also globalize the media that is presented on technologies like computers and cell phones. The United States has become a big exporter of media culture (through Hollywood films, for example). Some worry that this can dilute indigenous cultures and develop one world culture (called cultural homogenization).

Advantages of Technological Globalization

1. Easier International Trade
With digital technologies we can speed up customs at nation-state borders, move money more efficiently and even move goods faster as air flight innovation improves. A clear example is the rise of international currency conversion apps like TransferWise.

technological globalization advantages and disadvantages

2. One World Economy
Technologies that automate trade can help create a more cohesive globalized economy. This will speed up the development of market efficiencies and economies of scale (such as those discussed in my article on economic globalization). One example of this is if one nation has a competitive advantage in producing a particular good, they can produce it en masse and make it cheaply available to the whole world.

3. Economic Growth
The World Bank [2] found that technological globalization has “contributed to rising domestic productivity levels in advanced and emerging economies.” Technologies can help us produce good more efficiently and with less man power, which in turn makes those goods cheaper and allows businesses to scale faster.

4. Reducing Poverty
The World bank [1] also found that technological globalization has overall reduced poverty rates around the world. They state: “Rapid technological progress in developing countries has been central to the reduction of poverty in recent decades”. Despite this excellent outcome, there are also clear losers from globalization, which is discussed below.

5. Faster Technological Innovation
The global spread of technology has also enabled scientists and engineers around the world to engage in global competition. Each nation observes other nations’ innovations and builds on them, enabling technology to be developed faster and faster.

6. Rise of Online Communities
Those with access to the internet are able to develop contacts with others who share their own hobbies and interests around the world. This has allowed people to ‘find their tribe’ and helped people to develop their identities in unique new ways, rather than around traditional nationalistic or regional identity formations.

Disadvantages of Technological Globalization

1. Has not Closed the Digital Divide
The digital divide is a phenomenon that occurs when wealthier people have better access to technology than poorer people. The inequality in the distribution of technology gives a comparative advantage to wealthier developed nations. While technological globalization has allowed technologies to spread around the world faster, the digital divide still exists between and within nations around the world.

2. Replacement of Workers by Machines
New technologies have been implemented in factories to replace workers in menial tasks. While this has been good for making cheaper goods, many worry that it will destroy entire industries and leave people unemployed and disillusioned. For example, Andrew Yang warns of the impact of automated driverless trucks on the trucking industry:

3. Cultural Homogenization
As people around the world get access to global media technologies, the dominant media producers (namely, the United States and in particular Hollywood) spread their cultures around the world. This has led to people blaming globalization for the “Disneyfication of culture” while indigenous and local cultures become diluted.

4. Rise of Fake News
As internet technologies have enabled anyone to develop their own podcast, YouTube channel or blog, control over the spread of information has been diluted. There are concerns that new technologies have allowed for conspiracy theorists and extremist organizations to spread their nefarious messages online.

Conclusion

Of the eight types of globalization, technological globalization is one that touches on all the others. Technology helps speed up economic and cultural globalization, for example. In this sense, the ‘types’ of globalization aren’t self-standing concepts, but each one impacts the other.

Technological globalization has had wide-reaching consequences for our world. The jury is still out on whether the spread of technology around the world (what we often call ‘technological diffusion’) has had positive or negative impacts. And the truth is it’s had good impacts in some senses and negatives in others.

REFERENCES IN APA FORMAT

Cristadoro, R. (2018). The Unintended Consequences of Globalization and Technological ProgressInternational Macroeconomics in the Wake of the Global Financial Crisis, 73-96.

Grossman, G. M., & Helpman, E. (2015). Globalization and growthAmerican Economic Review105(5), 100-104.

Milner, H. V. (2019). Voting for populism in Europe: globalization, technological change, and the extreme right. In Conference on Frontiers in Comparative and Political Economy, London School of Economics and Political Science, London, UK.

Reddy, P. (2017). Globalization of technology: issues in technology transfer and technological capability building. Encyclopedia of Life Support Systems.

World Bank (2008). Global Economic Prospects 2008: Technology Diffusion in the Developing World. Retrieved from: https://elibrary.worldbank.org/doi/abs/10.1596/978-0-8213-7365-1

World Bank (2018). Globalization and Technological Transformation. Retrieved from: https://www.worldbank.org/en/events/2018/10/18/globalization-and-technological-transformation