14.1 Globalisation Flashcards
What is globalisation
The process of increasing economic integration of the worlds economies
What are causes of recent globalisation(2 asp)
Improvements in informational and communication technology (ICT)
Developments in transport
Who are the world trade organisation(WTO)
An international body whose purpose is to promote free trade by persuading countries to abolish import tariffs and other barriers to trade. As such, it has become closely associated with globalisation
What are multinational corporations(MNC)
Enterprises operating in serval countries but with headquarters in one country
What are the 6 main characteristics of globalisation
-greater international mobility or capital and labour
-growth of international trade and reduction of trade barriers(known as trade liberalisation)-encouraged by the world trade organisation
-significant increase in the power of international capitalism and multinational corporations or transnational companies
-the deindustrialisation of older industrial regions and countries and the movement of manufacturing industries to newly industrialist countries
-decrease in gov power to influence decisions made by MNCs to shift economic activities between countries
-more recently, the movement of internationally mobile service industries, such as call centres and accounts offices, to NICs
What is trade liberalisation?
growth of international trade and reduction of trade barriers
Diagram for characteristics of globalisation
What are less economically developed countries?
Countries considered behind in terms of their economy, human capital, infrastructure and industrial base
What are less economically developed countries characterised by?
High unemployment
High population growth
Poor infrastructure
Ovezrderpendece on commodities
What do the critics of globalisation argue
Low paid workers end up working to quality for IMF
People prefer goods for global cooperations than traditional local produce
What are more economically developed countries?
Countries with a high degree of economic development, high average income per head, high standards of living, usually with service industries denominating manufacturing and investment having taken place over many years in human capital and infrastructure
What does the dependency theory of trade and development disagree with?
The belief less economically developed and more economically developed countries benefit from globalisation
What do dependency theorists argue?
Many economically developing countries possess little capital because the system of world trade and payments has been organised by developing industrial economies to their own advantage
(In terms of trade industrialised countries benefit at the expense of primary producers
How does globalisation allow benefit developing economies?
Country must export more in order to buy the same quantity of capital goods or energy vital for development
Globally the movement of the terms of trade in favour of Economically developed countries has…
Raises levels of income and standards of the living in the richer countries at expense of economically developing countries
(Exceptions such as oil producing non-industrial countries which has benefited from substantial increases of oil over recent decades)
What do free market economists view about the growth of globalisation?
It is inevitable
What do free market economists argue the benefit of globalisation?
Expansion of political freedom and democracy as well as the economic benefits of more production and higher living standards
What are the disadvantages of globalisation?
-destruction of local cultures
Rising inequalities
What is the EU?
An economic and partially political union established in 1993 after the ratification of the Maastricht treaty by members of the European community and since expanded to include numerous central and Eastern European nations
What are 4 factors encouraging the overseas location of call centres?
-highly reliable and cheap telecoms
-24-hour shift employment
to overcome the problem of time zones
Relatively low wages in economically developing countries and in eastern and Central Europe
Workers fluent in English (buisniness language of the world)
What is one thing slowing globalisation
Immigration controls
What does the EU’s expansion cause?
Increasing both capital mobility and labour on a regional basis
Reduces county’s power to control multinational cooperations(less freedoms for tariff controls)
What are the 4 ways MNS have driven globalisation?
Economic integration and increased trade
Investment and technology transfers
Chasing employment patterns an global capitalism
The global market place and international brands
What are the 4 ways MNS have driven globalisation?
Economic integration and increased trade
Production process broken down to specialise labour in different countries in global supply chains
What are the 4 ways MNS have driven globalisation?
Investment and technology transfers
Technology is transferred from developed to developing countries
Erodes technological advantages of developed countries
What are the 4 ways MNS have driven globalisation?
Changing employment patterns and global capitalism
Manufacturing and industrial employment decreases in developed countries leading to structural unemployed
Creation of jobs in developing economies
Affects inequality: poorest get jobs in factories reduces income inequality slightly
Has risks of environmental degradation,pollution , and long dangerous hours
What are the 4 ways MNS have driven globalisation?
Global market place and international brands?
MNCs compete against each other in the world , they develop globally recognisable brands, standardised products erode national boundaries
(Same products sold to different people in different countries)
