3.2.1.1 GSGG globalisation Flashcards
capital
Money that is invested – it is spent on something to produce an income or increased profit from it
Economies of scale
The cost advantages that result from the larger size, output or scale of an operation as savings are made by spreading the costs or by rationalising operations.
Financial deregulation
A process undertaken by governments where they relaxed rules about what banks were allowed to do. Banks could charge more for their services and invest in a greater range of businesses. Barriers to capital coming into and out of a country were also removed. removal of rules to increase competition.
Foreign direct investment
When a person, company or other group spends money in another country.
Globalisation
The process of the world’s economies, political systems and cultures becoming more strongly connected to each other.
Global systems
This refers to any organisations, groupings or activities that link different parts of the world. TNCs, for example, operate in 2 or more countries, therefore linking their economies.
Outsourcing
When a company pays another company to do work that in the past would have been done in-house e.g. call centres
Services
Economic activities that aren’t based around producing any material goods e.g. banking
Tariff
A tax or duty on imports or exports.
Trade agreement
Set of rules that cover trade between countries (who make the agreement
Bilateral - between 2 countries
Multilateral - between several countries.
Bilateral and multilateral trade agreements make up the global trade system
Trade blocs
Associations between different countries that promote and manage trade.
Transnational corporations
Companies that operate in more than one country
