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Public policy and technology are the two main driving factors behind the current
globalization boom. Over the past 20 years, governments worldwide have integrated a free
market economic system through fiscal policies and trade agreements. This evolution of
economic systems has increased industrialization and financial opportunities abroad.
Governments now focus on removing barriers to trade and promoting international commerce.
Technology is a major contributor to globalization. Advancements in IT and the flow of
information across borders have increased the awareness among populations of economic
trends and investment opportunities. Technological advancement such as digitalization has
simplified and accelerated the transfer of financial assets between countries.
Internationalization is the designing of a product in such a way that it will meet the needs
of users in many countries or can be easily adapted to do so. In the context of economics,
internationalization can refer to a company that takes steps to increase its footprint or client
base outside of its country of domicile and into international markets. The global corporate trend
toward internationalization has helped push the world economy into a state of globalization,
where economies throughout the world are highly interconnected due to cross-border
commerce. As such, they are greatly impacted by each others' activities and economic well-
being.
There are many differences between globalization and internationalization, starting with
the time they began to occur. Internationalization started as part of the Industrial Revolution
between 1870 and 1914, whereas globalization is a post 1960’s phenomenon. Other differences
between these two terms include their impact on firms, on global trade, and on society and
culture. First of all, while globalization is often used to describe the change in the world
economy to a more liberal and interdependent system, internationalization refers more narrowly
to the activity of firms on an international scale and the resulting impact of their decisions.
Internationalization is, for example, a European firm trying to export its product overseas, and
the causes and the consequences of this act. A firm trying to standardize its products on an
international scale is also considered as internationalization. Secondly, many recent advances
in technological fields such as communication and transportation have helped globalization
increase worldwide trade and investment. The beginning of this ‘free-trade’ era started when the
Soviet Union was defeated by the United States, and the end of the Cold War. On another hand,
internationalization did not really globalize the economy but rather promoted the activity of a
nation and its companies internationally. A typical example would be signing a trade or
investment contract with another country (or countries) to install good economic relations
between them.