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Globalization: Production Costs and Tariffs

By: Joseph Bensen

Globalization impacts my life and my family members lives in many different ways. One being our ability to purchase cost effective products. Since many popular companies have their factories all over the world, many of these companies create their products in other countries and import them to America. Most often, the products are more cost effective when they are manufactured in other countries; therefore, the cost is dependent upon the country the manufactured goods are produced in. For example, Nike has over 700 factories that produce all of their products including: “124 plants in China . . . and others in Asia” (TheGuardian). Taking advantage of the extremely low wages in other countries allows many companies’ products to be more cost effective and allows consumers, including myself and my family members, to be able to afford buying them.

Recently, globalization has not helped the United States at all. With increases in tariffs on imports, many companies within the United States who outsource their production are being forced to increase their prices, move their factories within the United States, or stop selling their products within the United States. This causes the US to lose income off of the taxes the country would make because the prices are now less affordable for the consumer to purchase. Also, the unemployment levels will rise in the near future because companies will have to balance out their profit margins with the increased cost in labor and goods. However in the foreseeable future, once negotiations in trade between the US and other countries are complete, the US will potentially gain jobs and increase income since there the trade policy’s will be more fair, and there will be an incentive for companies to make their own products in the United States and not worry about overseas’ transportation and foreign markets.

Works Cited:

https://www.theguardian.com/business/2005/apr/14/ethicalbusiness.money

https://www.strtrade.com/f-tariff-actions-resources.html

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