Development Gap & Patterns, Exports and Imports, Globalisation, Multinational Companies. Flashcards
What is development?
The process of change for the better this can be economic, social or political
What does the term ‘development gap’ mean?
The widening difference of development between rich and poor.
What is the world bank?
An international financial institution that provides loans to developing countries for capital programmes.
What is the development continuum?
A linear scale from high developed countries to those with a low level of development.
What 4 categories of wealth does the world bank place countries in?
- High income countries (HIC’s),
- Upper-middle-income countries,
- Lower-middle-income countries,
- Low income countries (LIC’s).
Gross domestic product (GDP) is one way to measure economic development. What is it?
The total value of all goods and services produced within a country in a year (Total value of the economy)
The average wage of a countries population is known as…
Gross national income (GNI)
Give 2 other ways we can measure economic development.
- Poverty: The percentage of the population that earn less than $1.90 per day according to the world bank.
- Employment structure: The type of work people do (Primary-Like farming, Secondary-Factory work or tertiary -Services).
What is Purchasing Power Parity (PPP)
A way of comparing the average wealth of a country by taking the cost of living in those countries into account it converts the GNI into a figure that describes what that money will buy in local prices.
What are the limitations of using economic measures of development?
They measure only wealth and do not include social factors, They do not recognise the inequality within a country, Without PPP it does not consider the cost of living and what people can afford within that country.
What does NIC stand for? Can you give a named example of one?
Newly industrialised country - India, China, Mexico, Brazil.
Malawi is an example of an LIC country which is landlocked what does this mean?
It has no coastline and therefore has no sea ports.
What key issue does being landlocked create for Malawi?
Difficulty trading with other countries.
What types of products does Malawi export?
Tobacco, Tea, Cotton, Sugar - Low value goods
What types of products does Malawi import?
Oil and Farm machinery - High value products
What to HIC’s export?
Manufactured goods
What do LIC’s export?
Primary goods
What is globalisation?
The process by which the world’s economies, societies and cultures have become integrated through communication, transportation and trade.
What 4 factors drive globalisation?
- MNC’s (Multinational companies),
- Communication technologies,
- Trade,
- Culture.
Give 5 ways that NIC’s such as India and China benefited from globalisation?
- Rapid economic growth,
- Cheap labour so manufacturing industry boomed,
- Changes in technology so they can invest and encourage MNC’s to locate to them,
- Flows of people- Migration,
- Flows of idea and culture - Bollywood
Give 5 reasons MNC’s such as Nike locate to NIC’s & LIC’s
- Weaker legislation on staff safety, welfare and environment
- Lower labour costs
- Reduced costs of buildings and land
- Government incentives
- Closer to markets where goods are sold.
What are the positives of MNC’s such as Nike locating to NIC’s & LIC’s?
Investment provides jobs and skills for local people, Multiplier effect
What are the negatives of MNC’s such as Nike locating to NIC’s & LIC’s
Profits sent back to HIC where the MNC is based
MNC’s can drive out local businesses.
If the MNC decides to close its factory to relocate people can be made redundant.
Lack of laws mean that they operate in a way that they wouldn’t be able to in a HIC e.g polluting rivers, Sweatshop conditions for workers etc.
What country did you study for where Nike produces sportswear?
Vietnam
