Global Systems 1 Flashcards
1
Q
Globalisation
A
The process by which the world becomes more interconnected on an economic, social and political scale
2
Q
Concept of globalisation
A
- world has always been interconnected
- concept only developed in 1960s
3
Q
Forms of globalisation
A
- Economic
- Social
- Political
4
Q
KOF globalisation index
A
Measures the economic, social and political dimensions of globalisation
5
Q
Most globalised nations
A
- Switzerland
- Netherlands
- Belgium
6
Q
Worlds major economies on globalisation index
A
Major economies (US, China, Germany) tend to be more inward looking and less globalised
7
Q
Factors that affect how globalised a country is 4
A
- Ease of trade
- Foreign investment
- Presence of TNC’s
- Stability
8
Q
5 major areas of globalisation
A
- Economic
- Social
- Political
- Flows of capital
- Flows of labour
9
Q
Economic globalisation is made up of what
A
- Actual economic relations and flows
- Restrictions to trade and capital
10
Q
Social globalisation is made up of… (3)
A
- Personal connections across the world
- Information flows
- Cultural proximity (International influence)
11
Q
Distance decay
A
Process by which actual geographic distance symbolic feels smaller
12
Q
Largest migrant flow
A
- Mexico to US
- 2 million annually
13
Q
Information flows
A
- Quantitative data on how well a country is connected
- based on internet infrastructure, TV viewership and other tech
14
Q
Political globalisation is made up of… (2)
A
- Membership of international organisations
- Diplomatic relations
15
Q
Flows of capital is made up of…
A
- International transactions between countries
- Previously restricted domestically
16
Q
Global FDI difference
A
- $400 billion (1990)
- $1500 billion
17
Q
What drives further capital movement?
A
- Improvements in access to technology
- Interconnected nature of world
18
Q
Value of global financial flows
A
$5.1 trillion
19
Q
Trends of capital flows 3
A
- US highly involved in capital flows
- NA and Europe largest
- Growing significance in Asia
20
Q
Flows of labour is made up of…
A
- Labour increasingly moving internationally
- Generally poor to richer
21
Q
Number of International workers
A
170 million
22
Q
HIC facts in comparison to the world
A
- Purchasing power = 50%
- Population = 14.7%
- Exports = 61%
23
Q
Factors promoting globalisation 5 (PLSCI Please Slowly Look In Cod)
A
- Flows of PRODUCT
- Flows of SERVICES
- Flows of LABOUR
- Flows of INFORMATION
- Flows of CAPITAL
24
Q
Flows of information
A
- Can be spread faster than ever
- Makes the world more interconnected
25
What is Foreign Direct Investment (FDI)
Investment made by a foreign company in the economy of another country
26
Largest receivers of FDI
- Germany, US and UK accounted for 27%
- India and China 7%
27
Flows of product 4
- Changing balance of economies based on global demand
- LIC = Raw material
- MIC = Manufacturing
- HIC = Services
28
Drivers of outsourcing and product flows 3
- Cost savings
- Service quality
- Strategic position
29
UK value of imports change
- £200 billion 1990
- £682 billion 2021
30
UK economy sectors change
- 60% tertiary 1900
- 81% tertiary, 1% primary 2000
31
Flows of services 3
- Financial or insurance services
- Low level services outsourced (Callcenters)
- High level services (Financial)
32
What is a growing trend in outsourcing?
- High level services are also being outsourced to where it is cheaper
- KPMG outsourcing accountancy
33
What does the flow of services rely upon?
Depends on the flow of information and capital
34
Flows of labour
Movement of people from one country to another to work
35
How much has international migration increased since 2000?
40% in 15 years
36
Containerisation
System of standardised transport enabling goods to be transferred anywhere in the world
37
Developments supporting globalisation
- Technology
- Financial systems (SWIFT)
- Trade agreements
- Communications
38
How many shipping containers empty back to China from US
3/4 in 2021
39
Global marketing
Marketing strategy that targets the world as a single market
40
Benefit of global marketing strategy 3
- Economies of scale
- Global appeal
- Develop preexisting products
41
Drawbacks of global marketing
- Cultural differences
- Homogenistation
42
McDonalds as an example of global marketing 3
- Uses consistent imagery internationally
- Adjusts menu based on consumer preferences
- Still carries consistent elements everywhere (Big Mac)
43
Coca Cola operates in all countries except...
Cuba and North Korea
44
How has CocaCola marketed itself globally?
Created single product where only minor elements are tweaked
45
How many people are employed by CocaCola?
700,000
46
How does CocaCola adjust global marketing strategy? 3
- Consistent shape and size of bottle
- Imagery changed to adapt to local culture
- 'Taste the feeling' common theme
47
How did Coke utilise social media? 3
- Can tailor social media presence to target markets
- Retain customers
- Sensationalises brand
48
What elements of Coke's global marketing is similar to other campaigns?
- Create positive association of brand
- Universal movement via storytelling
49
Coke's contribution to globalisation 4
- 0.7 million employed
- HQ in Atlanta but operates in all
- 70% of sales outside the US
- Total value of $235 billion
50
Impact of Coke on host countries (positive) 4
- Training programmes for workers
- Employment of women
- Positive multiplier
- Recycling awareness
51
Impact of Coke on host countries (negative) 4
- Worker exploitation
- Growing obesity crisis
- Profits taken from countries
- Damage to water supplies
52
Coke environmental impacts 4
- Drain on watersheds
- 2.9 million tonnes of plastic in ocean
- Pesticide usage
- Biggest ITW
53
Coke global investment
- $2 billion into India
- $90 million into R&D
54
BRIC nations
Brazil
Russia
India
China
55
MINT countries
Mexico
Indonesia
Nigeria
Turkey
56
Global manufacturing transition
- 95% of global manufacturing in North America, Europe and Japan (1950)
- 50% in LICs (2010)
57
Why does some production remain in HICs?
- Skilled workforce
- Government subsidies
- Access to markets (EU)
- Tesla Berlin
58
Patterns of production, distribution and consumption
- Historical view all contained within local area
- Modern era consumption only in HIC
59
Changing patterns of distribution 4
- Investment into infrastructure making trade easier
- China - Peak railway $62 billion
- Saudi port $20 billion
- Arctic trade routes
60
Diaspora
Group of people with similar heritage moving to the same area
61
Profit repatriation
Profits made by TNCs been taken back to home country HQ
62
Remittance
Transfers of money made by foreign workers back to home country
63
Biggest remittances
- US > Mexico ($22.2 billion)
- Typically countries close to one another
- Global to Philippines ($38 billion)
64
What proportion do remittances make up of Philippines economy?
9%
65
Benefits of flows of labour
- Remittances can help develop nations
- Address worker shortages
- Better quality of life for workers
66
Somalia flows into country
- $12 billion in remittances
- $800 million in Aid
- $500 million in Exports
67
Why are labour markets not as free flowing as financial markets?
- Restrictions on immigration
- Emotional connection
- Cost of movement (transport, visa)
68
Somalia remittances
- $1.3 billion
- Makes up 35% of GDP
69
Causes for the need of remittances in Somalia 4
- Agricultural crisis caused by drought
- Civil war means no central authority
- No developed industry
- 67% youth unemployment
70
What did people resort to in Somalia?
- Piracy
- Terrorism (Al Shabaab)
71
What sanctions were placed on Somalia?
- Removal from global financial system
- Hampered flow of remittances and NGO efforts
72
Why were sanctions put in place for Somalia?
Accusations of international funding of terrorism and piracy as well as money laundering
73
Consequences of sanctions on Somalia
- Reduction in piracy rates
- Intensified civil war
- Famine killing 0.25 million
74
Long term sanction consequences for Somalia
- Declared hungriest and poorest country
- Money sent through unreliable 3rd parties
75
Voluntary migrant
A person who chooses to move
76
Forced migration
Person forced to leave country because of circumstances
77
How are the flows of globalisation connected?
- Economic, social, environmental and political flows all dependant
- Any change can lead to global impact
78
How does global risk vary?
As countries export and depend on different things it means their exposure to risk varies but carry global consequences
79
Migration
Permanent or semi-permanent movement of people from one place to another
80
Examples of migration
- Fleeing conflict = Forced
- Job opportunity = voluntary
81
Unequal flows of people
- People tend to move from where there's a few(LIC) to many jobs (HIC)
- Those that move aren't the poorest
- Restrictions
82
UK unequal flow of labour example
Poland
83
Gini coefficient
A measure of income inequality within a population, ranging from zero for complete equality, to one if one one person has all the income
- closer to zero means greater equality
84
Lorenz graph
85
Proportion of people living on $1.25 per day
Fallen from 47% to 22%
86
8 richest have the same amount of wealth as...
the poorest
87
Gap between poor and rich countries
- 200 years ago gap was 3x wealthier
- in modern day 80x richer
88
Globalisation social effects
- Impact on peoples lives
- Wealth distribution
- Somalia
89
Globalisation economic effects
- TNCs exploitation
- Domestic industry loss
- Domination
90
Globalisation political effects
- Trade blocs
- Global institutions
- Global commons (Global management required)
