Economic globalisation Flashcards
What is economic globalisation?
Economic globalisation is the increasing integration, across international borders, of trade, finance and labour
Advantages of economic globalisation
• Strength economy
It strengthens the UK economy, allowing a wider range of economic policy options
Advantages of economic globalisation
• Multinationals
The power of multinationals means that policies to tackle issues like tax avoidance and evasion, excessive bonuses, and banking regulation can no longer be effectively made at a UK level, but instead require international co-operation and agreement
Disadvantages of economic globalisation
• Control of movement of labour
Effective control over the movement of labour has become more difficult, and has been relinquished altogether in respect of the EU, making attempts to preserve “British jobs for British workers” largely meaningless
Disadvantages of economic globalisation
• Financial crisis
Financial crises, such as the credit crunch since 2008, cannot be contained within individual countries. Instead, there is likely to be a ‘domino effect’, meaning that the Eurozone crisis may impact significantly on the UK. These crises also have a knock-on effect on areas, such as money supply and interest rates
Disadvantages of economic globalisation
• International investment
Globalisation makes it both more important and more difficult to attract international investment, particularly given the increasing challenge from the BRIC countries
Disadvantages of economic globalisation
• Economic sovereignty
Responses to economic globalisation and to crises tend to strengthen the powers of international bodies, such as the EU and IMF, further eroding economic sovereignty.
Advantages of economic globalisation
• More powerful
If action can be co-ordinated with other countries then it can be much more powerful than in a pre-globalised world.
