What is globalization?

Globalization refers to the process of increased interconnectedness among countries, which encompasses the expansion of international trade, investment, technology transfer, and cultural exchanges. This phenomenon has been driven by advancements in communication and transportation, leading to a more integrated global economy where goods, services, information, and people move more freely across borders. As trade barriers decline and markets open up, countries engage more significantly with one another, resulting in mutual economic growth and cultural exchange.

The alternative choices reflect concepts that stand in contrast to globalization. A decrease in international trade suggests a retreat from interconnectedness, while a focus on local economies emphasizes a more isolationist approach, often arising in response to the effects of globalization rather than being a part of it. Similarly, a strategy for increasing tariffs indicates a movement towards protectionism, which would limit trade and counteract the principles of globalization. Therefore, the second choice effectively captures the essence of globalization as it highlights the increasing linkages and dependencies created among nations worldwide.