4.1.3 Flashcards
What is ‘globalisation’?
International influence or starting to operate on an international scale, the growing integration of the world’s economies and increasing interconnectivity of modern trade
What is ‘trade liberalisation’?
The reduction of restrictions on international trade, it its true form, free trade
What 3 main effects does trade liberalisation have?
- Increases competition
- Forces continual development
- Supports industrial specialisation of certain countries and helps to find their USP
The World Bank, IMF and WTO are all examples of what?
Inter-governmental organisations
What effect does ‘foreign direct investment’ have?
Investing in growing markets means businesses move into fast emerging economies to be near the increasing demand
What effect does ‘migration’ have on business?
Ability to relocate internationally has increased and people’s ability to relocate internationally has increased
What 4 things have reduced costs in international trading meant for transportation of goods and communication?
- 90% of non-bulk products were moved by standardised container globally in 2009
- Larger container ships = economies of scale
- Instant ‘free’ global communication
- Internet - especially as a marketing tool
What is a TNC?
A Trans-national corporation, such companies have offices or factories in different countries with a centralised Head Office where they coordinate global management, they are a main cause of globalisation
What 5 factors have lead to growth in the labour force?
○ Population growth - doubled since 1970
○ Improvements in mortality rate
○ Cultural developments - women in the workplace
○ Employments rights - greater access to employment
○ Skill sets - increasing
What increased with demand?
As demand increases, so does the need for imports, contributing towards globalisation
What 3 things signify structural change of an economy?
- A shift in the structure and operation of an economy
- As developed and fast emerging economies move towards and through the tertiary sector, more skilled labour is demanded (secondary industry is capital intensive through automation)
- Higher income levels, greater and more varied demanded results
What is an FDA?
A Free Trade Area, which aim to abolish all trade barriers between participating countries. Barriers such as tariffs, quotas and administrative barriers must be completely removed for free trade to exist
What are the 3 main types of free trade agreement?
- Bilateral, which involved an agreement between two countries to allow free trade
- Regional, where agreements exists between several countries, usually with close proximity to each other, to allow free trade
- Multilateral, where there is an agreement between a wider range of countries to allow free trade
