4.1.1. Globalisation Flashcards
What is Globalisation?
Economic integration of different countries through increasing freedoms in the cross-border movement of people, goods/services, tech and finance. Has been increasing for thousands of years due to improvements in tech and speed of global connections have increased level of interdependence between nations (increasing integration of the world’s local, regional and national economies into a single international market)
What are the four main characteristics of Globalisation?
1.Increasing foreign ownership of companies
2.Free trade in goods/ services
3.Increasing movement of labour and tech across borders
4. Easy flows of capital (finance) across borders
What are the two main factors that have contributed to the rapid increase in pace of globalisation?
- Containerised shipping
- Innovation in communication technology
What factors are contributing to globalisation?
2000 value of global trade= $6.45 trillion
2020 value of global trade= $19 trillion
-Economies of scale generated by containerisation
-Tech and internet improving communication
-WTO negotiating new trade agreements
-growth in amount of TNC’s
What is containerised shipping?
A system in which many goods are placed in large metal containers for transport by boat
What is containerisation?
Refers to the use of standardized shipping containers to transport goods across different modes of transportation (e.g., ships, trucks, trains) without the need for repackaging or unloading at each stage of the journey (Economies of scale)
What are some impacts of globalisation on consumers?
-More choice since wider range of goods available
-Lower prices as firms take advantage by producing in countries with lower costs
-Can lead to rise in prices since incomes are rising and higher demand
-Worry about loss of culture due to MNC’s
What are some impacts of globalisation on workers?
-Some gain employment while others lose it
-Increased migration may affect workers by lowering wages
-International competition led to fall in wages for low skilled workers in developed but increased for those in developing countries
-Increased income inequality
-TNC’s create new jobs and train
-Sweatshops will see poor conditions and low wages
What are some impacts of globalisation on producers?
-firms able to source more products from more countries and sell in more countries which reduces risk
-Employ low skilled workers and can exploit
What are some impacts of globalisation on government?
-Receive higher taxes but could lose out through tax avoidance
-TNC’s can bribe and lobby governments
-use right policies to maximise gains and minimise losses
What is lobbying?
Act of attempting to influence decisions made by government officials, legislators, or public officials in favor of a particular cause, policy, or issue.
What are some impacts of globalisation on environment?
-Increase demand for raw materials is bad for environment
-Increased trade and production led to more emissions
-Globalisation means world can work together to tackle climate change and share ideas and tech
What are some impacts of globalisation on economics growth?
-Increases investment within countries which represents injection and will have larger impact due to multiplier
-New technology and techniques can have knock on benefits
-Power of TNC’s can cause political instability
