Category:	Science and Technology
Domain:	Economics
Keywords:	Economics - economics, telecommunications, globalization
Outlook:	The next wave of global trade may be driven by a trend towards sourcing off-shore services and information-processing tasks that can be delivered electronically.
Summary Analysis:	The first modern wave of globalisation, which drove economic growth during the 1990s, was largely based on deindustrialization in developed countries, and the re-location of manufacturing to Asia. China is today what Manchester was in the 18th century – the world's workshop. Advanced telecommunications systems allow close coupling of supply and demand into a single global system of production. While this phenomenon will continue to contribute to future growth, there are limits to its impact in the next 50 years – much of the potential has already been exploited. However, the massive telecommunications capacity deployed in the 1990s is enabling a second wave of globalisation, but in service and information industries rather than manufacturing. To date, the two sectors most heavily affected have been software development and telephone-based customer service operations such as airline reservations. Over the next 20 years, firms in Western countries will begin to off-shore information analysis tasks to take advantage of wages that are 1/5 to 1/4 of their Western counterparts. This trend may produce negative political backlash in the developed economies, which may experience significant labour market shocks, similar to those that affected its blue-collar workforce during deindustrialisation. For example, there are approximately 500,000 call-centre jobs in Britain alone that may be at risk in the next 20 years. However, off-shoring is a very successful strategy for global firms to increase their competitive edge through cost savings and many of these lost jobs will be replaced with new more highly-skilled positions. (Economist, 2004)

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	Enablers/drivers:	Global bandwidth glut, continued spread of English as dominant global business language, regulatory reform in India According to a major survey of economists' predicitions for the 21st century, approximately 90 percent predicted that globalization would proceed at least as fast as it did during the 1990s. Furthermore, half expect globalization to proceed at a faster rate than in the 1990s. (Pryor, 2000)
	Leaders:	Tata Consultancy Services [link] CompuPacific International, China [link] Centre for Business Research, University of Cambridge [link]
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	Sources:	India First Foundation [link] "Offshoring and its Implications for the Information Systems Discipline." 26th International Conference on Information Systems. 2005 [link] "Customer Service in the UK -- a Response to the Contact Centre Off-Shore Debate." UK Trade and Investment, BT eLocations and Call Centre Association [link] "Off-Shoring and the City of London." March 2005. ISMA Centre, University of Reading, and London School of Economics [link] "Special Report: Outsourcing in China." Economist May 6 2006 Economist. Nov 11, 2004. "The rich world's Bangalore: How Britain gains from offshoring" [link] Friedman T. 2005. The World Is Flat: A Brief History of the Twenty-First Century. Pryor, F L. 2000. "The Millennium Surveys: How Economists View the U.S. Economy in the 21s Century". American Journal of Economics and Sociology. Vol 59, No. 1.

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