Globalisation Flashcards

1
Q

Define globalisation

A

Increased integration of economies around the world

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What are the characteristic of globalisation

A
  1. Increased international movement of labour
  2. Increased international movement of financial capital
  3. increased specialisation
  4. Increased international trade
  5. Increased trade - to - gdp ratio
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What are the factors that contributed to globalisation

A
  1. Improvement in IT (more movement of financial capital)
  2. Improvement in transport (freer movement of labour)
  3. Improvement in shipping, containerisation (led to more international trade)
  4. Trade liberalisation (removal of trade barriers, more international trade)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Define tariff

A

Tax on imported goods

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Define quotas

A

A fixed limit on quantity of imported goods

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Define subsidies

A

Grant given by the government to help domestic firms become more cost competitive against imports

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Globalisation for countries
advantage and disadvantage

A

Rise in living standards

(globalisation -> characteristics -> trade -> specialisation -> lower cost -> cheaper goods -> disposable income -> standard of living)

overdependence due to specialisation
(50% oil GDP of Saudi Arabia)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Globalisation for producers
advantages and disadvantages

A

AD:
reduced costs through relocation
(Meta outsourcing its content moderation to india to reduce cost)

DA:
transnational companies create high barriers to entry (economies of scale) for small domestic firms (Mcdonalds in France)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Globalisation to consumers
advantages and disadvantages

A

AD
Wider range of products and lower price

(globalisation -> more competition -> product innovation and diversity -> consumer surplus and more choices)

DA
Less choice if large global companies dominate - monopoly power leads to more homogenous products

Lower standard of living for consumers who lost jobs from deindustrialisation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Globalisation for workers
advantage and disadvantage

A

AD
More job opportunities from growing firm, FDI from transnational or multinational firms

DA
1.deindustrialisation caused unemployment (structural unemployment)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Globalisation on government
advantage and disadvantage

A

AD:
increase government spending from more tax revenue

DA:
Tax avoidance from firms moving to another country with lower tax rates (Apple in Ireland and Bermuda)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Globalisation on environment
advantage and disadvantage

A

AD:
global cooperation to fight climate change

DA:
more global warming

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Define deindustrialisation

A

A decrease in the relative importance of industry and manufacturing in a developed economy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Define FDI

A

Flow of capital from one country to another, in order to gain a long term
interest in an enterprise in the foreign country.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Define multinational company

A

Firm that has a headquarter in one country who owns subsidiary companies operating in other countries.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Define TNC

A

firm that operates in two or more countries.