Updated September 2, 2023
Difference Between Globalization vs Internationalization
Globalization means connecting the economies of the world for free trade and economic policies to integrate the world into the global village. Globalization is at the core of any of the policy planning by the International Monetary Fund (IMF) or United Nations. It is the process of opening the nation’s economies to other nations and to sync the rules and regulations with other nations. Internationalization means to produce goods or deliver services that have the capability of entering into the international markets and have standards that are globally accepted. Internationalization means to expand the business and enter into the market of different countries. It is the process in which a business, firm, or individual expands and becomes part of other countries; it may be for goods supply, customer base, or other demand fulfillment.
The 21st Century is the age of technology, which has no barrier. It’s a century of the world which should not have any constraint in relation to communication, trade or, commutation, or goods movement, or it may be related to strategic thinking. In India, in 1991, the wave of the liberal economy started, opening the door for globalization in India. With this, various International brands put their footprints in the Indian Market, and many Indian brands started going globally, coming into the limelight of the international market. With these terms like globalization and internationalization were coined by economists and businessmen. Many people consider both terms the same; however, both globalization vs internationalization are different.
In 1991, India accepted Liberalization, Privatization, and Globalization and opened the economy for world-class companies to invite foreign investment in the nation. With these, foreign brands like MacDonald, Google, Citi Group, HSBC Inc, Starbucks, etc., started investing in India, and Indian brands like Tata, ITC, Reliance, etc. started expanding outside India and becoming eminent leaders in their area of work.
Here, we can see that Globalisation is the result with which free and open trades are end result of global business markets. To achieve this result, various brands started putting their steps outside the nation and started delivering goods and services that are up to the mark of international standards, which is nothing but the internationalization of that brand or product.
Head to Head Comparison between Globalization vs Internationalization (Infographics)
Below is the top 7 difference between Globalization vs Internationalization:
Key Differences Between Globalization vs Internationalization
Let us discuss some of the major differences between Globalization vs Internationalization:
- Globalization is the end result, while internationalization is one of the tasks/tools/processes to achieve them.
- Globalization is more with the nations and their economies, while internationalization is more related to the individual, firms, and corporations for doing up their businesses.
- Globalization is a process, and internationalization is part of the same
- Major factors that affect globalization are infrastructural and logistics setup, telecommunications, etc., while internationalization is affected by cultural tastes and preferences, local traditions, etc.
- The major example of Globalisation is the Elimination of Visa Obligations, removing tariff and non-tariff trade barriers, liberalizing investment-related obligations, etc., while an example of internationalization is sourcing, producing or selling materials or delivering services from one or more countries, setting up branches and subsidiaries in other countries, etc.
- Globalization is an economic process as it aims to integrate the economies, while Internationalization is an improvisation process as it will lead to the expansion of the business across the nations.
- Organizations like IMF, World Bank, WTO, etc., observe and work to implement globalization while institutions like the EU, APEC, NAFTA, etc. boost internationalization.
Globalization vs Internationalization Comparison Table
|The Basis of Comparison Between Globalization vs Internationalization
|Globalization is a result which is desired by the global economies
|Internationalization is the task/process with which globalization can be achieved.
|Set and Subset
|Globalization is the structure that people want to set up.
|Internationalization is part of that structure and, hence, can be termed as a subset of globalization.
|Globalization is more related to the economies of the nation.
|Internationalization is more related to the individual, firm, or business for their goods and services.
|Factors that affect
|Infrastructural setup, telecommunications, logistics, etc., highly affect globalization.
|Cultural tastes and preferences, Local traditions, etc., play a major role in the internationalization.
|Eliminating 1. visa obligations for visitors, 2. tariff and non-tariff trade barriers, 3. Liberalization of investment regulations, etc.
|Sourcing, producing, and selling materials from one or more countries, setting up branches or subsidiaries in other countries for carrying out business, etc.
|It is an economic process.
|It is an improvisation process.
|International Monetary Fund, World Bank, World Trade Organisations, etc., are handling globalization implementation.
|European Union, Asia Pacific Economic Cooperation, North American Free Trade Agreement, etc., work to boost Internationalization.
In short, Internationalization is related to a firm’s movement overseas. While globalization is the rapidly growing integration of communication, financial, as well as a political ideology. Although internationalization is the process that results in globalization as firm movements could be said to be the cause of globalization.
With the passage of time, Free traders would say we want to become less self-sufficient and more globally integrated to satisfy the consumer needs more adequately. In the end, this increased interdependence will also eliminate war-related situations, ultimately leading to harmony among the nation. Free trade, specialization, and global integration mean that nations are free to trade. Yet freedom not to trade is surely necessary if a trade is to remain mutually beneficial.
There is a substantial difference between globalization vs Internationalization. Internationalization is to perform at the international standards with our domestic labor and natural resources to compete for the international market. It is an effort with own nation’s national labor, capital, and resources by operating in domestic as well as international markets, but globalization is to integrate the economies with integrity and unity around the globe to use other nations’ labor, capital, and resources of all to reach the best results.
This has been a guide to Globalization vs Internationalization. Here, we also discuss the key differences with infographics and comparison table. You may also have a look at the following articles to learn more –