Globalisation Flashcards
TNC
Transnational Company (eg. McDonalds)
Globalisation
The process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange.
Globalisation includes
- Movement of people (migration, including knowledge and culture)
- Trade (including product and money, mostly through TNCs)
- Communication and Transport (eg. telecommunication, jet aircraft)
- Environmental issues (eg. global warming)
- Politics (continental or global organisations, eg. the EU and UN)
Where is the Uniball pen from?
Japan
Where are North Face shoes from?
Cambodia
Where are Pritt Sticks made?
Germany
Where are iPads made?
China
Where are calculators made?
Thailand
Trade
Buying and selling goods (physical products) or services (doing work for someone).
TNC
Trans-National Corporation - a company that operates in several countries. It may have a headquarters in one country, a factory in another, and shops in many other countries.
Foreign Investement
When a company or country invests in projects abroad. Eg. A US based company may build a factory in China and spend some money improving the transport network there.
Labour
To work, especially physical work
Developement Aid
Money, goods or help given to a country to help them make improvements to their country eg. providing money and training for a community to build a school
Economic Blocs
Agreements where groups of countries agree to reduce taxes for goods and services traded between those countries. This means that it is cheaper to buy or sell products or services in the countries participating in the agreement.
Transport
Carrying people or goods from one place to another by a vehicle, aircraft or ship.
Information technologies
Systems for sending, storing and receiving information
What are the factors that have accelerated globalisation since 1945?
- Emerging Markets Development- the growth of regional trade blocs (eg. the EU or NAFTA) due to the encouragement of free trade between countries, breaking down barriers of national boundaries and increasing global trade
- Interconnected Transportation- this is the ability to transport products or people, at an accelerated rate and being less costly
- Advance in Communication- inventions increasing communication, such as the transport mechanisms (eg. planes or high-speed train) and information exchange (eg. internet or e-mail)
- TNCs- Trans-national corporations or international franchises, as they increased in size and influence
Global Shift
Change across the world, started in the 1850s
The Clark Fisher Model
This model shows manufacturing movement to other countries, as the quaternary sector grows. Manufacturing has moved as it is cheaper, using child labour (with no minimum wage), unsafe working environments, overworking, no break policies, and no environmental laws.
A global economy involves 5 different forms of flow:
- Trade - export or import of raw materials, food, goods and services
- Aid - either donor or receiver - usually money
- Foreign Investment - TNCs exploit opportunities to make money eg. oil in North and West Africa
- Labour-Economic Migration - TNCs looking out for cheap labour
- Information - Transfer of data
Global Shift
This is the movement of manufacturing (secondary industry) from developed to developing countries over the last 50 years.
How has globalisation caused a global shift?
- the absence of environmental laws - UK has strict laws
- cheap land - buying new factories
- UK - people expect higher wages and there are too many employment and health and safety regulations
- transport - it is cheaper, due to the development of containerisation, and distance is less of an issue
- communications technology - it is rapidly improving, as communication in production chains is quicker, easier and cheaper
- South-East Asian countries - they are a source of raw materials, that can be exploited, and uneducated or cheap labour is present, due to consumers increased education
Advantages of globalisation
- reduced cost of living due to cheaper imports of manufactured goods
- higher profit of TNCs
- job opportunities in the host country, for manufacturing
- increased tax income of the host country can be spent on infrastructure, education and healthcare development
Disadvantages of globalisation
- unemployment for factory workers in home country, due to deindustrialisation
- exploitation of people in host country (eg. long hours, poor working conditions, low wages)
- pollution of host country
- westernisation of host country (loss of culture) due to TNC presence
