Geography of the global economy Flashcards
What do hyperglobalists believe?
De-regulation, dominance of MNCs and global finance
Single global economy
Distance and location no longer matter
Neoliberalism: free markets spread wealth, reduced state involvement, pro-business environment
What do sceptical internationalists believe?
Globalisation is a myth
World economy actually globally connected in 1890-1914: age of empire and mass migration (50 m Europeans migrated 1850-1914)
Most MNCs ‘home nation’ based
Globalisation and free markets lead to inequality and uneven development
Role of state regulations still important and imperative, still market control
What do transformationalists believe?
Longer term process, recognition of qualitative shift in relations between states, corporations and places
Shallow integration to deeper integration
Rejects homogeneity, globalisation is complex and uneven process creating inequalities and differences
Governance structures can shape globalisation
How has trade grown faster than output?
1950s+ trade of merchandise increased 20x compared to output 6x
Increased global integration but with regional geographical concentrations
Europe: 39% of global trade but 70% of trade is within Europe
Asia: 29% global and 57% internal
N America: 16% and 38% internal
How has FDI grown faster than trade?
Exponential rise of MNCs/TNCs
TNCs account for >2/3 of international trade
1/3 of world trade within TNCs
2011: 30% of global GDP driven by stocks of FDI
2011 UK: 54.4% of GDP driven by inward FDI (20% in 1990)
What are the structural imbalances?
Increased global integration but is shaped by and is shaping uneven geographies of trade and current account surpluses and deficits
Countries with large deficits (USA) borrow from countries with large surpluses (China)
Exporters depend on market growth in deficit countries
Hence contagion effects of 2008 and more recent China slowdown
Continuing geographical concentrations, shifting focus
Growth in developing countries, 2013+ slowing down
75% of all manufacturing and service production in 15 nations
80% of outward FDI from 15 countries (USA and UK 30%)
In developing over half of all inward FDI goes to 5 countries (China and Hong Kong 30%)
USA still dominates, but less so
Overtaken by China in manufacturing production
Still world’s largest producer and exporter of commercial services, FDI
Europe major player, uneven profile
World’s largest trading area and hub for FDI
Germany powerhouse (2nd largest exporter of manufactures)
UK 2nd biggest source of FDI and exporter of commercial services
Post-2008 struggle of ‘peripheral economies’
Asia resurgence
Most significant global shift of last 60 years
1950: 19% of global GDP
Rise of Japan: 3rd largest manuf, 2nd largest services
S Korea, Singapore, Hong Kong, Taiwan, Indonesia, Thailand export led growth
Re-emergence of China
Potential dynamism of India
China Resurgence
1980-2003 growth rates 10% per year, now 8%
Worlds largest manufacturer, agri producer, exporter of merch, 2nd largest importer
50% of GDP based on exports
Global impacts on prices of commodities, manufactures and capital flows
Megatrader and factory of the world
