Explanation/Reference:
Grid computing is a technology architecture that virtualizes and pools IT resources, such as compute power, storage, and network capacity into a set of shared services that can be distributed and re- distributed as needed. Grid computing involves server virtualization, clustering, and dynamic provisioning.
Note: With Grid computing, groups of independent, modular hardware and software components can be pooled and provisioned on demand to meet the changing needs of businesses. Grid computing is really a form of distributed computing and it aims to deliver flexible and dynamic infrastructures using tiered optimization. It uses virtualization at various levels of the middleware and database layer to achieve it.
Reference: Oracle Reference Architecture, Application Infrastructure Foundation, Release 3.0