The world has experienced rapid globalization in the last few decades. Both developed and developing countries are increasingly participating in globalization and becoming part of the global village. The world economy has increased significantly and countries all over the world, whether developed or developing, have seen the size of their national economies grow. Even though globalization has been beneficial for the world economy, it has led to the emergence of certain problems in different parts of the world and in both developed and developing countries.

Globalization has had a tremendous positive impact on poverty reduction. The increasing integration of developing countries to the world economy has led to a reduction in extreme poverty. According to the World Bank, 52 per cent of people living in developing countries lived in extreme poverty in 1981. By 2011, this has decreased to only 17 percent. Large developing countries like India and China experienced rapid decreases in extreme poverty. While China experienced rapid economic growth due to globalization, it lifted 680 million people out of extreme poverty between 1981 and 2001. The significant reduction in poverty in the developing world shows the beneficial effect of globalization on poverty reduction. Globalization opened up developing countries to the world economy. Developing countries experienced substantial inflow of foreign direct investment, technological inflow and the opportunity to serve a substantial customer base in the developed countries. This led to the setting up of factories and companies that employed increasing number of workers and helped them to move out of poverty.

The last few decades have been characterized by the emergence of a growing middle class in the developing countries. This has especially happened in the fast growing developing countries like Brazil and China. Over the