Globalisation

Question 1

What is Globalisation

Answer 1

Globalisation is the process by which the world becomes interconnected as a result of trade, improvements in transport and communications.

Question 2

What are the reasons for Globalisation

Answer 2

•Improvements in Technology: Internet and mobile technology has improved communication between business and consumers internationally (around the world).

•Consumer Demands: as income levels increase and consumer awareness expands, consumer may want products from overseas.

•Freedom of Trade: The W orld Trade Organisation (W TO) encourages free trade between countries which leads to globalisation.

•Transport Improvements: Goods and people can travel quickly and easily between countries

Question 3

What are the positive impact of Globalisation

Answer 3

1. Wider Consumer Choice: Consumers can buy products previously not available to them. This involves sharing experiences & culture. This means competition for Irish businesses.
2. New Businesses: Large companies may set up a business in Ireland to meet the needs of Irish consumers. They may buy raw materials from local suppliers in Ireland which helps small Irish businesses.
3. Employment: Large companies that set up a business in Ireland will need an educated and skilled workforce which means they will hire local people.
4. Lower Prices: TNCs benefit from lower production costs due to economies of scale (the price per unit reduces the more items you make) and as a result they can charge less for their items than smaller businesses.

Question 4

What are the negative impacts of Globalisation

Answer 4

1. Benefits the rich more than the poor:Globalisation operates mostly in the interest of the richest countries which dominate world trade at the expensive of poorer ones.
2. Local communities:There is no guarantee that the wealth from inward investment will benefit local people where the company operates. Often profits are sent back to the home country of the multi-national organisation e.g Apple’s profits return to America
3. Negative environmental impacts:Demand for productive land,water and other raw materials has reached unsustainable levels and is having a negative impact on the natural environment globally.
4. Crowding out:Due to economies of scale,TNCs may drive smaller local businesses out of business e.g Starbucks crowding out a smaller locally owned cafe

Question 5

What are the advantages of ICT

Answer 5

1. Accessibility:Internet and mobile technology has improved communication between business and consumers internationally. This allows consumers to shop online 24/7.
2. WiderChoice:Having access to a company’s website means that a consumer can buy goods from anywhere in the world.
3. OnlineBooking:Consumers now can book holidays & events online.This means there is no longer such a need for businesses to have a physical presence.
4. Consumer Feedback:Consumers can give feedback to businesses through online forums, email and social media. This feedback can be instant and assists other consumers making choice e.g. positive product reviews

Question 6

What are the disadvantages of ICT

Answer 6

1. No human interaction:Some people prefer to deal with people in person when buying products and services.
2. Returning goods:It can be inconvenient(difficult)and expensive to-return products that have been purchased online.
3. Fraud:A website may take your money but have no intention of delivering the products.