4.1.1: Globalisation

Question 1

What is globalisation?

Answer 1

A process in which national economies become integrated and interdependant.

Question 2

What are the characteristics of globalisation [GDP & FDI]?

Answer 2

-Increase in trade as a proportion of GDP.
-Increased migration of people & movement of financial capital.
-Increase in foreign direct investment (FDI).
-Increased international specialisation & division of labour.

Question 3

What are the factors contributing to globalisation [TNC]?

Answer 3

-Improvement in transport infrastructure.
-Reduced protectionism.
-Transnational companies (TNCs).
-Improvement in technology and communication.

Question 4

What are the impacts of globalisation for consumers?

Answer 4

-More choice, since there is a wider range of goods available.
-Lower prices, as firms produce in countries with lower labour costs.
-A rise in prices, since incomes are rising, and there is higher demand for goods and services.

Question 5

What are the impacts of globalisation for workers?

Answer 5

-Large scale job losses in the Western World in the manufacturing sector, as these jobs have been transferred to countries such as China.
-TNCs tend to provide training for workers and new jobs.
-Increased migration towards countries with vacancies in an industry.

Question 6

What are the impacts of globalisation for producers?

Answer 6

-Products can be produced through different parts in different countries (e.g. car manufacturing).
-They can employ low skilled workers for much cheaper in developing countries.

Question 7

What are the impacts of globalisation for governments?

Answer 7

-Receiving taxes from TNCs and their employees.
-TNCs can bribe governments, leading to corruption.
-Some governments might lose their sovereignty due to the increase in international treaties.

Question 8

What are the impacts of globalisation for the environment?

Answer 8

-Increased demand for and transportation of raw materials is bad for the environment.
-Globalisation means the world can work together to tackle climate change and share ideas and technology.

Question 9

What are the impacts of globalisation for economic growth?

Answer 9

-TNCs may bring world class technology.
-Increased competitiveness (e.g. telecommunication).