Activity 1 - Globalization

Student name:
Lesson no. and topic: Lesson 1 – Globalization
Activity number: 1
Name of the country: Germany
Flag of the country:
Answers to the questions:

1. Is the nation the home base of any large multinational companies?
Answer: Yes, Germany is the home based of one of the well-known brand of shoes and this is
also one of the largest sportswear manufacturer in Europe and that is “Addidas”. It is a German
multinational corporation founded and headquartered in Herzogenaurach, Germany. This was
established by Adolf Dassler who was a German cobbler, inventor, and entrepreneur. Aside
from that, he was also the younger brother of Rudolf Dassler who was the founder of “Puma”.
Moreover, the interesting part is the history behind this company name was named before his
name. During his days, his nickname was “Adi” and his last name “Dassler” this two names was
merged into one to come up with a name of “Adi Das”. The “Adi” his nickname and “Das” came
from his last name. Then, later on he renamed his business into Addidas.
Data source: www.top10best4u.com | European Route of Industrial Heritage
2. How does globalization influence the country's jobs and wages, its income inequality, and its
culture, sovereignty, and physical environment?
Answer: According to my research and other sources, globalization has really affect the country
in different aspects. One of the key indicators is the increasing number of population due to
immigrants coming from other country. Moreover, this globalization merely amplifies and
expose some of the demographic challenges that the country is facing. Because of this,
Germany’s workforce is slowly lowering their job availability and opportunities due to
inadequate qualifications for the job. That’s why with regards with their job opportunities and
wages during those times there are really having a hard time transitioning to a more integrated
and interdependent economy. Another reason, is the employment growth which is directly
associated with jobs and wages has become more critical during those times due to economic
recession and also in transitioning toward an economy driven by knowledge-intensive services
of which the vast majority of German workers are affected more by the internal changes and
external factors within the economy.
With regards to income inequality, German people experience a wide inequality during
2008 of which the incomes of the poorest nearly falls by 13% whereas the richest people which
10% of the population has increased by 31%. In their population as a whole the average is 10%
increase in net income per capita of which 25% of all Germans are close to or below poverty
line. And the middle class is being squeezed with only 54% of the population belongs to the
middle income group. I think this only shows during those times the real effect and how
significant this transitioning or shifting can be to Germany. This was really an economic
phenomena. According to IMF or International Monetary Fund based on their empirical
assessment they conclude that the financial deepening can have a moderately negative impact
on income distribution to the extent that there is unequal access to finance between rich and
poor segments of a country’s population and another major source of income inequality is
unemployment. Moreover, the International Monetary Fund concluded also that overall, “that
the main factor driving the recent increase in inequality and other factors is that because of
technological progression.” To the extent that technological change favors those with higher
skills and exacerbates the “skills gap,” it could adversely affect the distribution of income in an
economy by reducing the demand for lower skill activities and increasing the premium for
higher-skill activities and returns on capital.
Going in with their culture, sovereignty, and physical environment the globalization does
not only bring disadvantage within the economy of Germany. But it also provides advantages
which is consistency or it maintains to be one of the largest and most competitive economies in
the world and that is because of the globalization process. Throughout the course and because
of this vast integration with the global economy. Germany’s trade flows have remained strong
and been redirected towards consumption-oriented, rapidly developing nations. Their foreign
direct investment flows to and from Germany are robust. With this kind of economic change,
their physical environment, culture, and sovereignty has been developing prosperously.
Through the help of globalization, in general, in the past decades or years it was a big helped in
raising their real economic growth and to maintain the nation’s status as one of the most
prosperous nations on earth. Further, Germany is Europe’s largest economy, accounting for
roughly a quarter of European GDP. It is the world’s fourth largest manufacturing producer and
the fourth largest producer of automobiles. It is the world’s third largest commercial services
exporter; the third most important source of foreign direct investment (FDI); is third in global
patents, and boasts the third most developed financial sector.
Data source: Germany and Globalization by: Daniel S. Hamilton and Joseph P. Quinlan (2008)
3. How does the country rank in terms of its degree of globalization?

Answer: According to the Globalization Index 2020 of the top 50 countries in the world,
Germany ranked as top 6 (88.83 index value points) in the bracket out of 50 countries. Top 1 is
the Switzerland then top 2 is Netherlands then top 3 is Belgium. The index or the KOF Index of
Globalization aims to measure the rate of globalization of the countries around the world and
the data used to construct this 2020 edition index was from 2018. This is based on three
dimensions: economic, social, and political. In terms of degree of globalization in accordance
with the statistics having these kind of attributes as a country I could say that Germany has
really gone through a long process in adapting with these globalization process and despite of
some of its adverse effects. They still continue to develop and enhance their economy
politically, socially, and economically. This is also shows how really deserving they are to be
included as one of the world’s largest manufacturing producer and exporter of goods. I think
behind that ranking in terms of the degree of globalization is because of these features.
According to U.S. news, Germany employs a social market economy – open-market capitalism
that also carries certain social service guarantees. Its economy is one of the world’s largest and
Germany is one of the globe’s leading importers and exporters. Services, which include
industries such as telecommunications, health care and tourism, contribute the greatest
amount to the country’s economy. Industry and agriculture are other significant economic
sectors.
That’s why I think they’ve become the seventh most competitive nation in the world
according to the Global Competitiveness Index and ranks second worldwide as a destination for
R&D investments by foreign companies during 2008. But come by 2018 and 2019 Global
Competitiveness Report was changed due to some reasons. This report was published by the
World Economic Forum (WEF). The Global Competitiveness Rankings have been paused in the
wake of the COVID-19 pandemic and challenges brought by it to the countries. According to the
report, Germany during 2018 ranked 3 rd place then come by 2019 it returns to 7 th place just like
in 2008.
Data source: Statistica.com - globalization index | World Economic Forum | U.S. News World
Report
4. What benefits can the country offer to businesses seeking a new market or production base?
Answer: I think when it comes to business opportunity Germany has the amazing production
base for those businesses who seeks and who wants to enter to a new market. It’s because
based on their overall statistics in terms of all the attributes that every country must have,
Germany can provide enough resources and sustainability that every business owner needs in
putting up their chosen business in the country. According to U.S. News, with regards to the
Overall Best Countries Ranking in the year 2021. Germany is the top 3 best countries overall
and ranked as top 4 out of 73 countries in 2020. Having $3.86 trillion Gross Domestic Product
(GDP) and $57,530 GDP PER CAPITA, PPP. With this gigantic figures, I could really say that there
would be a lot of benefits that Germany can offer especially to people who plans to open up
business in their country.
According to some articles and resources, these are the benefits that Germany can offer
to these people. First, is it has a strong dynamic economy of which having significant spending
power, an innovative climate, Germany is located at the heart of a dense transport network in
the centre of Europe and highly skilled workers. These are the benefits offered by Germany as a
perfect business location. Second, it has a stable and good home for ideas, meaning the country
can offer a stable political and economic environment for business ideas and what’s more
interesting is those ideas are highly protected by law. Third, it provides a wider range of target
customers of which that person’s background who will put up a business can be a big help in
attracting international customers. The reason is because Germany is a country of immigration.
In 2020 alone, more than 1.2 million people from abroad came to live in Germany. Having these
amount of people, for sure these immigrants has their own and unique taste and desires, could
be a starting point of a wonderful business idea. Lastly, Germany is really helpful in terms of
putting up new business idea and they would also provide you professional support and
funding. Once you have come up with a business idea, there are numerous information centres
who offers comprehensive advice in starting up a business and could provide you also some of
the best approaches and tips in establishing a business. Then after consulting with these
professionals, the next thing to do is to look for capital or fund. Thankfully, the government has
some programs that can provide a start-up fund for those who would like to have business in
their country. Which includes and wraps up some of the benefits that Germany can offer for
businesses who looks for new market and production base.
Data source: www.make-it-in-germany.com – The Federal Government | U.S. News World
Report

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Student name:

Lesson no. and topic: Lesson 1 – Globalization

Name of the country: Germany

Flag of the country:

Answers to the questions:

3. How does the country rank in terms of its degree of globalization?

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