Advantages claimed by the advocates of competition are temporary and in the long run are neutralized by adverse effects. Competition brings in its train unethical practices by attempts of firms to snatch away business and market share. Bribing is one tool liberally used by many claiming to have immense competitive strength. Heavy advertising boosts up costs of marketing and the burden is ultimately reflected on the price charged to the consumer. The intrinsic value of the material is much less compared to the cost of advertisement. So avoidable wastes occur. This cost exceeds the level required to create awareness of the product among the consumers and to provide information. This danger of unhealthy competition has been recognised by international agencies. This fear has given birth to organisations like WTO.
Hence they have evolved better methods of ensuring production and distribution on global scale. A good beginning is made in this direction through cooperation. Several international agencies like the European Union; European Economic Cooperation etc give proof of this trend. This principle of cooperation has been welcomed and adopted by bodies like the WTO. In the ultimate analysis we have to eliminate competition. The main reason is that, it gives rise to strategies, which are based on expediency, and unethical practices, which are harmful to the people. It benefits temporarily firms promoting competition. Because of this many firms particularly small business firms, are thrown out of business. They are unable to command the resources on a scale required to withstand the onslaught of major competitors. So some firms close down and massive retrenchment takes place. This gives rise to unemployment.
The world is now shrinking into a global village. This situation calls for cooperative effort and cooperation has to replace competition in as many fields as possible. More organizations should be formed on the lines of WTO protecting the interests of all countries instead of allowing each to fly at the throat of others economically. Firms in the industry should organize on regional basis on the lines the oil companies have done regarding sharing and distributing their products. Such regional cooperation will definitely help to sustain all firms in the industry and make available the transfer of know-how, managerial practices and technology.
A global federal approach as in the case of multinational companies industry wise and national federal approach based on cooperation will be helpful .The units forming part of the federal organization will retain the freedom of management subject to cooperation being observed as the cardinal principle. They will consult and act on common interests and strategies.
Such a system of international and national cooperation will ensure better results and better use of resources. There will be self-regulation and saving in advertisements costs and other marketing costs. The role of governments should be to facilitate this arrangement for working such a system so that globalisation with cooperation and not competition becomes the accepted economic policy of all governments. Such a world will usher in lasting prosperity for all (Concluded)