4.1.1 Globalisation

Question 1

What are the Characteristics of Globalisation?

Answer 1

1. Increased International Trade: the growing interconnectedness of economies fuelled by the exchange of goods and services across borders.
2. Information and Communication Technology (ICT): Advances in technology, particularly the internet and communication technologies, have played a pivotal role in globalisation by facilitating instant communication and information sharing across the globe.
3. Multinational Corporations (MNCs): the rise of multinational corporations that operate in multiple countries, seeking markets, resources, and labor efficiency.
4. Cultural Exchange: through media, travel, and immigration. This has resulted in greater cultural diversity and cross-cultural influences.
5. Interconnected Financial Markets: The global financial system has become highly interconnected, allowing capital to flow easily across borders and impacting the stability of economies worldwide.
6. Migration and Labor Mobility: Increased global mobility has led to the movement of people across borders for work, education, and other opportunities.
7. Global Supply Chains: complex global supply chains, where components of products are manufactured in different countries before being assembled elsewhere.
8. Standardization: of products, services, and business practices to meet international expectations and norms.

Question 2

What are some Factors Contributing to Globalisation in the Last 50 Years?

Answer 2

• Technological Advances: The rapid development of information technology, including the internet and mobile communications, has significantly reduced communication and transportation costs, facilitating global business operations.
• Trade Liberalisation: The removal of trade barriers through international agreements like the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) has promoted international trade.
• Economic Liberalisation: Many countries have adopted market-oriented economic policies, including deregulation and privatization, which have encouraged foreign investment and trade.
• Transport Infrastructure: Improvements in transportation infrastructure, such as containerization and the expansion of shipping routes, have made it easier and cheaper to move goods globally.
• Financial Integration: The liberalization of financial markets and the ease of cross-border capital flows have connected global economies more closely.
• Multinational Corporations: The expansion of multinational corporations into new markets and the establishment of global production networks have furthered globalisation.
• Political Stability: Greater political stability in many regions has reduced the risks associated with doing business abroad.

Question 3

What are some Impacts of Globalisation?
for each agent

Answer 3

1. Individual Countries: Globalisation can stimulate economic growth by increasing trade and foreign investment. It can also exacerbate income inequality within countries, as benefits may not be evenly distributed.
2. Governments: Governments may have reduced control over their economies due to international trade agreements and global market forces. International cooperation becomes essential in areas like climate change and financial stability.
3. Producers and Consumers: Producers gain access to larger consumer markets, but face increased competition. Consumers benefit from a wider variety of products and lower prices.
4. Workers: Globalisation can create job opportunities, but it can also lead to job displacement in certain industries. Concerns arise over labor standards, worker rights, and exploitation in some countries.
5. Environment: Globalisation can contribute to environmental degradation through increased resource extraction and pollution. There’s a growing emphasis on sustainability and responsible business practices to mitigate environmental harm.

Question 4

Define globalisation

Answer 4

Globalisation is a process by which economies become more inter-connected through global networks of trade, capital flows, and spread of technology and global media.