Globalisation - 4.1 Flashcards
what are the 5 emerging economies?
Brazil Russia India China South Africa
what are the mint economies and what does mint stand for?
The next wave of emerging economies after the Brics economies. Mexico Indonesia Nigeria Turkey
what is the definition of globalisation?
the process of making the world economy more interdependent
what is the definition of an emerging economy?
an economy in the process of rapid growth and industrialisation
what are emerging economies like? (4)
- economies making a transition
- rapid industrialisation ( development of tertiary and secondary sectors)
- faster long term economic growth than most developed countries
- many inhabitants are still in poverty, though economic growth is taking many out of poverty.
what are 5 opportunities of emerging markets posing for UK businesses?
- Opportunity for market development
- Smaller businesses can grow due to tech innovation
- UK businesses have access to markets as they’re easier to access
- more foreign direct investment in emerging economies - so infrastructure improves
- growing numbers of educated middle class consumers = growing consumer spending.
what are 5 threats of emerging markets posing for UK businesses?
- multinationals can abuse their power in emerging markets (e.g. poor pay, tax avoidance)
- Domestic competition from emerging markets
- loss of employment in the UK as MNCs offshore
- emerging markets becoming major exporters - competitive threat
- inadequate production of brand and other intellectual property - brand names, ideas, written word - patent, copyright, trademark
what is state subsidised?
a government making it cheaper by paying money for a product (with milk in the UK)
what does growing economies mean for employment levels? (3)
- because of FDI, businesses will shift in sectors - global shift (for example from agriculture to secondary/ tertiary)
- expanding middle class - secondary sector moves to other countries
- more women employment - equality laws
What are 4 ways to measure economic growth?
- GDP (total)
- GDP per capita
- Health
- Literacy
what is GDP? (2)
gross domestic product.
- It is a measure of the size of the economy
- A sum of everything a country produces - all goods and services
what is GDP per capita?
used as an average annual income of the countries residents
what are 2 limitations of GDP per capita?
- ignores the distribution of incomes given in a country
- although it gives an indication to average annual income, it doesn’t say how far that income goes (different countries have different price levels)
What does HDI stand for?
human development index
what does HDI combine?
combines life expectancy, education and income of population.
what does HDI measure?
measures economic growth
what are 3 criticisms of HDI? (3)
- standard HDI measure doesn’t take into account qualitative factors such as cultural identity and political freedoms
- The GDP per capita figure and HDI figures takes no account of income distribution
- Purchasing power parity (PPP) values used to adjust GDP data change quickly and can be accurate or misleading
what does health show in terms of it being an indicator of economic growth? (2)
- normally shows government value healthcare and invest in it
- shows democracy or political stability as they’re valuing their citizens
what are the 4 key factors in China, India and Bangladesh which have helped to grow their economies?
- greater willingness to accept inward investment from multinational or other big, wealthy companies
- greater enterprise on the part of the local business population
- more stable government than before (esp in India and Bangladesh)
- easier access for exports to countries such as Britain, America and the rest of Europe (partly from the world trade organisation and globalisation)
what are Indias 3 key weaknesses in its attempts to keep up with China?
- its poor infrastructure
- the narrow education system
- international trade: balance of payments deficit
what is the definition of balance of payments deficit?
imports outweigh exports; if it continues indefinitely, it means ever greater build up of foreign currency debt.
what is the definition of fixed capital formation?
an economists way of saying investment in long term assets such as roads or buildings
what is the definition of invisible export?
the sale of a service to an overseas customer
what are 3 issues of doing business in Africa?
- corruption
- poor infrastructure
- investor concern about stability