What is globalization, and what are some of the traditional international trade theories that support the concept of globalization?.

             Globalization is best described as the global integration of national economies, including trade, production, finance, and labor allocation (Hill, 2003). The main drivers of globalization over the past few decade years have been the technological revolutions in communications and information processing, and a liberalizing, pro-market introduction to national and international economic policy making.

             There are quite a few international trade theories that support the concept of globalization. The modern neoliberal/free-market capitalism theory is one such theory (Marouka, 2005). "[T]he inexorable integration of markets, nation-states, and technologies to a degree never witnessed before-in a way that is enabling individuals, corporations and nation-states to reach around the world farther, faster, deeper and cheaper than ever before . . . . the spread of free-market capitalism to virtually every country in the world " (Friedman, 2000, p. 9). .

             This theory discourages government intervention in the economy, promoting free-market practices, limited restrictions on businesses, and property rights (Wikipedia, 2006). In foreign policy, neoliberalism promotes the expansion of foreign markets by political means, using economic pressure, diplomacy, and even military intervention. Expanding markets increases free trade and an international division of labor. When it comes to globalization, this theory can be expanded to focus on utilizing the world's resources: cheap labor, raw materials, markets, in the most efficient way, and ultimately, make more markets open to entrance by developed nations.

             Capitalism is a theory that takes various forms across the world (Smith and Smith, 2002). While it creates wealth for many people, it creates suffering for many others. The gap between rich and poor has grown as globalization has expanded, demonstrating the supportive link between the two theories.