4.1 Flashcards
Growth of a country measured by
GDP -the total value of goods produced by a country
What are emerging economies
Economies that have increased growth rate but low income per capital e.g India
Uk growth
Tends to be lower than emerging economies due to a decline in manufacturing sector as businesses choose to manufacture in emerging economies due to lower labour costs.
What are the emerging economic powers of countries
BRICS Brazil Russia India china and South Africa they have a growing middle class which means disposable income increase, better for international firms selling in these countries
Implications of growth for people and businesses
People - reduced unemployment as more demand,
Businesses - larger profit as entering new market and customers
Indicators of growth
GDP
literacy
Health
HDI
Specialisation and competitive advantage
S-a business or country focus on one good,apple tech can increase quantity and quality which leads to economies of scale. Which helps them to gain competitive advantage ,
FDI
Inward - when a forging business invests in local economy
Outward - when a business expands operations to a foreign country .
Benefits - increased growth as inflow of money and increased job oops as outward fdi
Trade liberalisation
Reduction or removal of barriers to trade
+increased international trade, increased output and economies of scale.
-infant industries may not be able to compete with international firms
Factors contributing to increased globalisation
Political change - changes in gov , china joined WTO which led to more exports.
Reducing cost- economies of scale and containerisation
Increased fdi- important for job creation.
Migration- allows workers to have more flexibility to find work
Protectionism
When govs seek to protect their industry from foegein competition with tariffs
Tariff
Placed on imported goods, increases prices which shifts demand away from foegein business
Import quotas
The gov limit on amount of a particular product allows in the country
Other trade barriers
Gov legislation - laws as to what can be imported to protect customers e.g USA chicken made with chlorine .
Domestic subsides - payments to own businesses tower costs.
Trading blocks
European Union . Association of southeast Asian nations )ASEAN)
