Globalisation Flashcards
Why is competition a benefit of the global market place?
More firms incentivises more competition which drives prices down for consumers and stops monopolies/oligopolies.
Why are resources a benefit of the global market place?
Presents access to raw materials, that are not available worldwide through trade, improving international relations.
Why is economic growth a benefit of the global market place?
Globalization increases trade levels and investment opportunities across borders which elevates economic activity leading to growth.
Why is business stability a benefit of the global market place?
Tastes and preferences change rapidly, a wider market means that businesses have more time to adapt to these changes while still making sales.`
Why is access to capital a benefit of the global market place?
Opportunities in new markets make capital/labour more readily available as some markets are willing to raise capital more and produce at a lower price.
Why is Environmental Degradation a negative of the global market place?
Globalization causes more consumption which induces need for more logistical capital, thereby increasing emissions/pollution.
Why is Economic Instability a negative of the global market place?
Increased dependence on foreign markets means countries are more vulnerable to shocks abroad (are not self dependent).
Why is Income Disparity a negative of the global market place?
The rich get richer and the poor get poorer due to a surplus of labour making wages lower.
Why is Homogenization a negative of the global market place?
Less cultural disparity and increased spread of trends can cause repetition of design which reduces the quality of products.
Why is Exploitation a negative of the global market place?
Increases the human labour market and as supply of labour supersedes demand, working conditions of labourers reduces quality of life and living standards.
Why is offshore manufacturing used by MNC’s?
Reduce production costs, take advantage of lower wages abroad, less expenditure on cheaper tax rates, access raw materials and surpass regulations.
