Globalisation

Question 1

What is globalisation

Answer 1

The by which different economies are becoming more integrated and interdependent between one another

Question 2

Factors affecting globalisation

Answer 2

Improvements in transport infrastructure
Improvements in IT and communication
Trade liberalisation
International financial markets
Transnational Corporations (TNCs)

Question 3

Impacts of globalisation on consumers

Answer 3

-More choice and variety
-Lower prices due to comparative advantage
-Loss of culture
Rise in prices due to higher incomes

Question 4

Impacts of globalisation on workers

Answer 4

-Increased migration
-Poorer working conditions in developing countries
-Jobs losses in western world as manufacturing is outsourced to other parts of the world
-Increased inequality as higher skilled workers are demanding more for their services

Question 5

Impacts of globalisation on producers

Answer 5

-Can sell products in more countries
-Exploitation of comparative advantage
-Smaller firms won’t be able to compete internationally

Question 6

Impacts of globalisation on the government

Answer 6

-Higher income and corporation tax revenue
-Tax avoidance from firms and individuals
-Corruption through lobbying
-Reduced tariff revenue

Question 7

Impacts of globalisation on the environment

Answer 7

-Increased demand for raw materials
-More emissions released
-Increased cooperation in fighting climate change

Question 8

Impacts of globalisation on economic growth (think about the UK govt objectives)

Answer 8

-Increased investment by large companies
-World class technology can be transferred across the world
-The power of TNCs could cause political instability
-Comparative advantage can change overtime, leading to structural unemployment
-Increased in AD could lead to demand pull inflation
-Could lead to increased demand exports