Final answer:
Global competition, fueled by globalization and advances in technology, can lead to improved efficiency, innovation, and consumer benefits. There are, however, potential downsides, including reduced profits and job losses for less competitive firms and industries.
Step-by-step explanation:
The forces of globalization and the advancements in communications and information technology have had a significant impact on the level of global competition faced by firms today.
There are several potential benefits of this increased competition. First, firms may improve their efficiency and innovation due to the pressure to compete with international entities offering better or cheaper products.
Moreover, international agreements can act as a counterbalance to domestic protectionist tendencies, allowing for a more open trading environment. Lastly, consumers benefit from the increased variety and potentially lower costs of products.
However, the scenario is not entirely rosy. Heightened competition can lead to reduced profits for some businesses and job losses for workers in industries that can't compete.
On balance, according to some viewpoints, the economic gains from successful businesses and happier consumers outweigh the negative impacts on less competitive firms and their employees.