These benefits have led to a higher standard of living in the U.S. and abroad. Firms also benefit from globalization. They gain the ability to diversify more broadly. A U.S. firm that operates in many countries will find that recessions and booms in the many markets in which it operates are likely to be out of sync. This helps to stabilize companies' profits.
Firms also gain the ability to make use of financial markets worldwide.
In the last few years, we have seen that globalization can also provide a safety valve against overheating of the U.S. economy. One reason inflation has remained so low in the U.S. during this business cycle is that competition from foreign producers has made it difficult for firms producing in the U.S. to raise prices even when they face robust demand for their products. And firms that produce not only in the U.S. but also in other countries have been able to expand production abroad, and then ship to the U.S. as their U.S. production facilities run out of slack. That has helped avoid bottlenecks. Not everyone benefits.