4.1.1 Globalisation

Question 1

What is globalisation

Answer 1

The increasing integration of national economies in terms of trade, financial flows, ideas, information and technology

Question 2

What are some characteristics of globalisation

Answer 2

-increase in the value of trade
-increased FDI
-more global brands
-more specialisation of labour
-more global supply chains

Question 3

What are some causes of globalisation

Answer 3

-containerisation
-trade and investment deals
-transnational companies -economies of scale
-technological advancements

Question 4

How has containerisation helped cause globalisation

Answer 4

-economies of scale
-lower shipping costs

Question 5

How have trade and investment helped cause globalisation

Answer 5

-reduced trade barriers (tariffs and quotas)
-more deals between countries

Question 6

How have transnational corporations helped cause globalisation

Answer 6

-economies of scale via lower costs
-can manufacture in different parts of the world
-major contributors to FDI
-2/3 of global trade

Question 7

How have technological advancements helped cause globalisation

Answer 7

-good internet connectivity (easy to exchange ideas, info, data)
-e-commerce
-payment systems
-outsourcing / freelance services

Question 8

What are some benefits of globalisation

Answer 8

-specialisation and trade increases economic activity
-increased consumer welfare (more choice, lower prices)
-more competition
-reduced absolute poverty
-rapid transfer of ideas leading to innovation

Question 9

What are some problems with globalisation

Answer 9

-increased relative poverty
-threat to global commons (environment)
-macroeconomic fragility
-trade imbalance
-structural unemployment
-loss of domestic industries

Question 10

What is de-globalisation

Answer 10

The process in which counties or regions become less integrated with the global economy

Question 11

What are the causes of de-globalisation

Answer 11

-increased protectionism e.g European Carbon Border Tax (ECBT) (tariffs, quotas, trade barriers)
-economic shocks (may lead countries to focus on domestic
-changing trade agreements (withdrawing or renegotiating)
-environmental concerns (policies to reduce long distance trade and hence emissions)
-health crises (disrupts travel, trade, supply chains)
-economic nationalism (policies to protect domestic industries)