Globalisation Flashcards
What is globalisation
The process of economies and cultures becoming more interconnected.
What are some of the key characteristics of globalisation
Increase in trade to GDP ratio
Greater capital flows between countries
More global brands
Deeper specialisation
Higher levels of labour migration
What are some of the drivers of globalisation + briefly explain them
Containerisation - the use of standardised container dimensions to make shipping more efficient
Technological advances - better communication systems
Differences in tax systems - more advantageous conditions may cause TNCs
Trade deals - overall, import tariffs have fallen
What are transnational corporations
Companies that have aspects of their operations located in different countries
Why are TNC’s important
Global trade
Infrastructure/supply routes
Employment
What are global value chains
Various phases of production
What are some of the benefits of globalisation
- More firm competition
- Gains from specialisation
- Political harmony through interdependance
- Access to more FOPs and innovations stimulates faster growth
What are some of the cons of globalisation
Rising inequality + exploitation of labour
Macroeconomic fragility
Trade imbalances
Structural unemployment
Brain drain
Tax avoidance
What is de-globalisation
The process of the world becoming less and less interconnected
What are the causes of deglobalisation
Protectionism
Economic shocks
Changing of trade agreements
Health crisis
Define external/economic shocks
Unexpected changes that originate outside a country but still impact it
What are some impacts of globalisation on producers
Opportunity of expansion but more competition
What are some impacts of globalisation on consumers
- Access to wider range of goods
- Potential employment opportunities
- Cheaper goods
- Economic impacts though
