4.1.3 Factors contributing to increased globalisation Flashcards
What factors contribute to increased globalisation?
- Trade liberalisation.
- Political change.
- Reduced cost of transportation and communication.
- Increased significance of global companies.
- Increased FDI.
- Migration.
- Growth of the global labour force.
- Structural change.
What are the benefits of trade liberalisation to the consumer?
- Lower prices.
- wider range of goods.
What are the benefits of trade liberalisation to the business?
- Can expand to foreign markets.
- More competition, investment and productivity.
- Access global resources.
What is the impact of political change on businesses?
Protectionist policies such as tariffs and quotas, as well as more open trade between countries.
How has the reduced cost of transportation and communication increased globalisation?
- The internet makes information travel quickly.
- UK citizens can travel.
- People can come to the UK for better paid jobs.
- Businesses can ship materials from all over the world.
- Bigger ships reduces the cost of transportation.
How has the increased significance of global companies increased globalisation?
- Use cheap labour to mass produce products.
- Heavy global advertising.
How do global companies affect domestic businesses?
- low minimum wage means they have low costs.
- Global companies have higher profits.
- Can invest in new tech and innovation to crush competition.
How has FDI led to increased globalisation?
- Businesses will set up operations inside a trade bloc to avoid tariffs.
( led to globalisation due to more companies in a country)
How has FDI affected businesses?
Can negatively affect domestic businesses.
How has FDI affected countries?
More jobs, GDP growth, skills transfer and more income.
How has migration impacted businesses?
- Some MNC’s move to less developed countries to give migrants jobs.
- Immigration provides lower income workers.
