Globalisation

Question 1

Define Globalisation

Answer 1

Refers to the way people and places across the world have become closely linked together. This has deepened global connections, interdependence and flows of capital, commodities, migrants and tourists.

Question 2

State the four pinnacles of Globalisation

Answer 2

• Economic Globalisation
• Social Globalisation
• Political Globalisation
• Cultural globalisation

Question 3

What is Economic Globalisation

Answer 3

o The growth of transnational corporations (TNCs) accelerates cross
border exchanges of raw materials, components, finished
manufactured goods, shares, portfolio investment and purchasing
o Information and communications technology (ICT) support the
growth of complex spatial divisions of labour for firms and more
international economy
o Online purchasing

Question 4

What is Social Globalisation

Answer 4

o International immigration has created extensive family networks that
cross-national borders – world city-societies become multi-ethnic
and pluralistic
o Global improvements in education and health can be seen over
time, with rising world life expectancy and literacy levels
o Social interconnectivity had grown over time thanks to the spread of
universal connections such as mobile phones and the internet

Question 5

What is Political Globalisation

Answer 5

o The growth of trading blocs allows TNCs to merge and make
acquisitions of firms neighbouring countries, while reduced trade
restrictions and tariffs help markets grow
o Global concerns such as free trade, credit crunch and the global
response to natural disasters
o The World Bank, the IMF and the WTO work internationally to
harmonise national economies

Question 6

What is Cultural Globalisation

Answer 6

o Successful Western cultural traits come to dominate in some
territories e.g. Americanisation or McDonaldisation of tastes and
fashion
o Glocalisation and hybridisation are a more complex outcome and
takes place as old local cultures merge and weld with globalising
influences
o The circulation of ideas and information has accelerated thanks to
24-hour reporting; people also keep in touch using virtual spaces
such as Facebook

Question 7

What 5 factors are accelerating Globalisation

Answer 7

• TNCs
• Transport and Communication
• Technology
• International Organisations
• Markets

Question 8

How are TNCs accelerating globalisation

Answer 8

• TNCs have influenced global culture and improved local economies
  providing job opportunities
• TNCs try to appeal to local markets by the process of glocalisation
  which means products are specially designed for the taste of the
  consumer
• Additionally, TNCs develop new markets and take advantage of
  economic liberalisation by offshoring and outsourcing

Question 9

How is Transport and Communication accelerating globalisation

Answer 9

• Improvements in mobile communications, internet, social media and
fibre optics have allowed people to connect together from all over
the world
• Transport development has produced cheap travel, reaching
everyone and causing time-space compression
• Migrants each year send home US$500 billions of remittances
which helps build economic connectivity

Question 10

Explain an example of the impact of improving communication on Globalisation

Answer 10

More than a million Kilometres of undersea cables carry the worlds emails, searches and tweets.

Satellites broadcast the position and time data to users throughout the world.

Deliveries can be tracked by companies using vehicle-tracking systems, helping the growth of global production networks to be managed

Question 11

Explain an example of the impact of cheap travel on Globalisation

Answer 11

Around 200 million individual container movements take place each year – some commentators describe shipping as the ‘backbone’ of the global economy since the 1950s.

E.g. the Chinese vessel, Cosco, is 336 metres long and can carry 13,000 containers

Question 12

Explain an example of the impact of remittances on Globalisation

Answer 12

Poland has become particularly reliant on remittances since its joining of the EU in 2004.

Remittances has directly increased the disposable income of recipients, who can then decide whether to spend them or to save them.

Depending on what goods or services are purchased, this can lead to increases in recorded consumption or investment, and thus, though multiplier effects, to increases in overall GDP.

Question 13

How do international organisations encourage globalisation

Answer 13

International political and economic organisations, such as the WTO and IMF, have contributed to globalisation by promoting free trade policies and foreign direct investment

For many decades three central international organisations have acted as ‘brokers’ of globalisation through the promotion of free trade policies and FDI

Question 14

International monetary fund (IMF)

Answer 14

• Based in Washington, DC, the IMF channels loans from rich nations
  to countries that apply for help. In return, the recipients must agree
  to run free market economies that are open to outside investment
• As a result, TNCs can enter these countries more easily

Evaluation…

• IMF rules can be controversial, especially the strict financial
  conditions imposed on borrowing governments, who may be
  required to cut back on health care, education, sanitation and
  housing programmes

Question 15

The World Bank

Answer 15

• The world bank lends money on a global scale and is headquartered
  in Washington, DC.
• In 2014, a US$470 million loan was granted to the Philippines for
  poverty-reduction programme
• The world bank also gives direct grants to the developing countries – e.g. grant to Democratic Republic of the Congo for a mega dam to
  kick start its economy

Evaluation…

• In total, the World Bank distributed US$65 billion in loans and grants
  in 2014
• However, like the IMF, the World Bank imposes strict conditions on
  its loans and grants
• Controversially, the World Bank presidents have all been American
  citizens

Question 16

World Trade Organisation

Answer 16

• The WTO took over from the General Agreement on Trade and
  Tariffs in 1995
• Based in Switzerland, the WTO advocates trade liberalisation,
  especially for manufactured goods
• Asks countries to abandon protectionist attitudes in favour of
  untaxed trade
• China was persuaded to lift export restrictions on ‘rare earth’
  minerals in 2014

Evaluation…

• The WTO has failed to stop the world’s richest countries, such as the
  USA and the UK from subsidising their own food producers
• This protectionism is harmful to farmers in developing countries who
  want to trade on a level playing field
• The WTOs continuing lack of success in getting its 159-member
  countries to reach a global agreement on any aspect of trade,
  especially in relation to food, raises questions about its long-term
  role

Question 17

Define Foreign Direct Investment

Answer 17

A financial injection made by a TNC into a nation’s economy, either by building new facilities, or to acquire, or merge with, an existing firm already based there

Question 18

What are the four key typed of Foreign Direct Investment (FDI)

Answer 18

Offshoring
Foreign Mergers
Foreign Acquisitions
Transfer Pricing

Question 19

What is Offshoring

Answer 19

Some TNCs build their own new production facilities in ‘offshore’ low-wage economies

Question 20

What is Foreign Mergers

Answer 20

Two firms in different countries join forces to create a single entity

Question 21

What are Foreign Acquisitions

Answer 21

When a TNC launches a takeover of a company in another country

Question 22

Transfer Pricing

Answer 22

Some TNCs such as amazon channel profits through a subsidiary company in a low tax country. (Ireland, Luxemburg)

Question 23

How do National Governments influence the acceleration of globalisation

Answer 23

National governments promote free trade blocs by removing trade barriers and forming international groupings

Additionally, policies such as free-market liberalisation, privatisation and encouragement of business start-ups help improve economic wealth whilst accelerating globalisation and forming global networks.

This has also led to huge stock growth

Question 24

What is the policy of Free-Market Liberalisation

Answer 24

• This model is associated with the policies of the US President,
  Ronald Reagan, and Margaret Thatcher’s UK government during the
  1980s
• Followed two simple beliefs:

 Government intervention in markets impedes economic
development
 As wealth increases, trickle-down will take place from the richest
members of society to the poorest

• In practice, this meant restrictions being lifted in the way companies
  and banks operated

Question 25

London (1986) (deregulation case study)

Answer 25

• In 1986 the city of London was deregulated by the Thatcher government an attempt to transform it into a global competitor similar to the likes of New York and other European capitals.
• There were three key elements of this de regulation:

 Abolishing minimum fixed commissions on trades,

 Ending the separation between those who traded stocks and shares

 The allowance foreign firms to own UK brokers.

Effects…

• It produced a free-for-all, as brokers, jobbers and the City’s
  traditional merchant banks merged.
• Across the world foreign investors were determined to gain a share
  in the new opened up stock exchange.
• Of the 300-member firms of the stock exchange that had all been
  domestic - within a year 75 were now foreign-owned.
• In Canary Wharf, plans for an entirely new financial district were
  sought
• Only a week after deregulation had been introduced, the volume of
  trade that flooded through the new terminals soared from averaging
  $4.5bn a week to more than $7.4bn a week
• London is now the world’s leading global hub for financial services

Question 26

How can National Government policies of Privatisation influence the acceleration of globalisation

Answer 26

• Privatisation is the transfer of a business, industry, or service from
  public to private ownership and control.
• Up until the 1980s, important assets, such as the railways and
  energy supplies, were owned by the state – however, running these
  services often proved costly
• Since then, UK governments have led the way in allowing foreign
  firms to gain a stake in the privatised national services and
  infrastructure
• Overtime, ownership of many assets has passed overseas, e.g.
  French company Keolis owns a large stake in Southern England’s
  railway network

Question 27

How can National Government policies of ‘encouraging business start ups’ influence the acceleration of globalisation

Answer 27

• Methods range from low business taxes to changes in the law
  allowing both local and foreign-owned businesses to make a profit
• Italy has eased restrictions on Chinese investors wanting to start up
  textile companies inside the EU; as a result, the city of Prato now has
  the largest Chinese population in Europe

Question 28

How can National Government policies of encouraging the ‘growth of free trade blocs’ influence the acceleration of globalisation

Answer 28

• Agreements have been drawn up all allowing state boundaries to be
  crossed freely by flows of goods and money
• Within a trade bloc, free trade is encouraged by the removal of internal tariffs
• This is used to promote trade activities within certain areas, whilst also assisting in economically managing specific regions.
• By implementing trade blocs, a means of agreement between the countries within that trade bloc is provided which enables them to benefit from each other through trade activities.
• As well as increased integration amongst members of a trading bloc. It is argued that trading blocs help globalisation through making global negotiations easier.
• For example, in the case of trade negotiations. The EU will negotiate as a single trading block making it easier to push through practices which increase free trade. Enlarged market increases demand

Question 29

Explain the European Union

Answer 29

• The European Union is a political and economic union of 28-member
  states that are located primarily in Europe. It has a population of 500
  million
• Over time the EU has evolved from being a simple trade bloc into a
  multi-governmental organisation with its own currency (the Euro) and
  some shared political legislation
• Member states are eligible for EU structural funds to help develop
  their economies, while agricultural producers in the region all benefit
  from farm subsidies issued under the common Agricultural Policy

Beneficiaries of the EU…

 By removing barriers to intra-community trade, markets for firms
grow. For instance, when ten new nations joined the EU in 2004, UK
first Tesco gained access to 75 million extra customers
 An enlarged market increases demand, raising the volume of
production and thereby lowering manufacturing costs per unit
 The EU also agrees common external tariffs and quotas for foreign b
imports – in 2006, the EU blocked imports of underwear from
Chinese manufacturers on the basis that the annual quota had been
exceeded, jeopardising sales of EU clothing makers

Question 30

Explain ASEAN

Answer 30

• ASEAN (the Association of South East Asian Nations) has 10-member
  states and a combined population of 600 million
• Established in 1967, ASEAN founding members include Singapore,
  Indonesia, Malaysia and the Philippines
• Over time, they have worked to eliminate tariffs in favour of free
  trade
• The enlarged ASEAN market has helped Indonesia’s manufacturing
  industries to thrive
• ASEAN is expected to develop further into a single market called the
  ASEAN Economic Community (AEC)
• The ASEAN agreement also promotes peace and stability: its
  member states have pledged not to have nuclear weapons

Question 31

How have Special Economic Zones (SEZs) influenced the acceleration of globalisation

Answer 31

• One of the important reasons for the acceleration of globalisation
  has been changing attitudes in regions outside of Europe and North
  America
• Asia’s most populated countries – China, India and Indonesia – have
  all embraced global markets as a means of meeting economic
  development goals
• In all three cases the establishment of Special Economic Zones has
  played an extremely important role

Question 32

Define Special Economic Zones

Answer 32

An industrial area, often near a coastline, where favourable conditions are created to attract foreign TNCs. These conditions include low tax rates and exemption from tariffs and export duties.

Question 33

Explain the impact of Indonesia as a Special Economic Zone

Answer 33

• Indonesia is an important example here, in the late 1960s the
  president opened up Indonesia’s markets
• American and European TNCs met with the Indonesian market and
  built an attractive new legal and economic framework for foreign
  offshoring
• Indonesia instantly became a popular offshoring location for TNCs
  like Gap and Levi’s
• World Bank lending funded the speedy modernisation of its roads,
  power supplies and ports

Question 34

China and its 1978 Open Door Policy

Impact of ‘switching on’ to globalisation case study

Answer 34

• Prior to 1978, China was a poor and politically isolated country,
  ‘switched off’ from the global economy
• However, in 1978 radical ‘Open Door’ reforms were sought which
  allowed China to embrace globalisation while remaining under one-
  party authoritarian rule

Actions…

 Foreign TNCs allowed to invest in some sectors of China’s domestic market
 World’s largest TNCs established branch plants, or trade relationships with Chinese-owned factories
 Newly established Special Economic Zones set up
 Mass industrialisation

Impacts…

 China transformed into an urban, industrialised nation – 300 million
people left the cities in search of a better life in the cities
 In the 1990s, 50 percent of China’s GDP was being generated in
SEZs
 FDI from China and its TNCs is predicted to a total of US$1.25 trillion
between 2015 and 2025.

Controversies…

 While China evidently has an open-door policy towards global
investment– it remains a highly restrictive nation and demonstrates a
number of ‘Closed door’ approaches to globalisation
 Google and Facebook are entirely banned from the Chinese market
 China’s Government sets a strict quota of only 34 foreign films to be
screened in cinemas each year
 Still some restrictive policies on TNCs in certain aspects of industry

Question 35

What is the KOF index

Answer 35

Measures globalisation on economic, social and political dimensions on a scale of 1-100.

These new scores are then compared to previous scores dating back to 1970.

It is a useful scale as it allows comparisons to be made between countries at any given time and uses data that is readily available.

However, trade calculations often ignore the informal economy which can account for a large proportion of actual trade.

Question 36

What is the Kearny Index

Answer 36

Broken down into 4 categories: Economic integration, personal contact, technological activity and political engagement.

Each one is given a value between 0 and 1. The Kearny Index is useful as it covers 96% of the worlds GDP, 84% of the worlds populations and allows for comparisons between countries over time.

However, only 64 countries are included in the index.

Question 37

What are the two measurers of globalisation

Answer 37

KOF Index

Kearny Index.

Question 38

Why is globalisation uneven

Answer 38

• Globalisation has affected some placed more than others
• The location of TNCs vary significantly – some parts of the world
  have benefited far more than other from FDI from TNCs because:

 Not all places are suitable sites of production for goods, for a range
of physical and human reasons
 Not all places have enough market potential to attract large retailers

Question 39

Define Global Production Network

Answer 39

A chain of connected suppliers of parts and materials that contribute to the manufacturing or assembly of the consumer goods.

The network serves the need of a TNC, such as Apple or Tesco.

Question 40

Explain the importance of Global Production Networks

Answer 40

• One other strategy that plays an important role in a TNCs attempt to
  build their global business are rooted within their Global Production
  Networks
• Rather than investing directly in the offshoring of branch plants, or
  acquiring foreign firms, TNCs can instead forge business
  partnerships with existing companies in other countries (outsourcing)
• For example, Tesco has established tens of thousands of
  outsourcing partnerships while building heir global businesses
• Global production networks have particularly benefited developing
  countries
• Local factory owners in Chinas Special Economic Zones (SEZs) have
  profited from the work that foreign TNCs have outsourced to them.

Question 41

Define Glocalisation

Answer 41

The practice of conducting business according to the local and cultural needs of a population, in order to maximise the appeal of a product

Question 42

McDonalds (Glocalisation case study)

Answer 42

• By 2012, McDonald’s had established 35,000 restaurants in 119
  different countries
• However, in order for this to occur, the TNC had to make a number
  of changes to its business model in order to attract consumers
  across the globe, who have different tastes, religions, laws and local
  interests
• In India, the issue has been catering for Sikhs and Hindus who are
  predominately vegetarian – while Muslims do not eat pork
• McDonalds opened a vegetarian restaurant for Sikh pilgrims visiting
  sites of religious importance in Amritsar

Question 43

What factors often contribute to a country being switched off to globalisation

Answer 43

• Some areas of the world remain relatively switched off from global
  production networks
• This can be due to physical, political, economic or environmental
  reasons

Question 44

North Korea

Impact of being ‘switched off’ to globalisation case study

Answer 44

• Country chosen to remain politically isolated from the world since
  the 1950s
• Ordinary citizens do not have any access to the internet or social
  media
• There are no undersea data cables connecting North Korea with
  anywhere else
• Huge amounts of poverty and a clear lack of development, despite
  its abundance in natural recourses.

Question 45

Sahel

Impact of being ‘switched off’ to globalisation case study

Answer 45

• The mismanagement of natural and human recourses has played a
  role
• Many of the countries in this region lack a coastline, which means
  they struggle to attract FDI
• Arid conditions and desertification give further rise to further
  development challenges
• In particular, the extreme environmental conditions increase the cost
  of providing infrastructure such as railways and ICT

Question 46

What is the ‘global shift’

Answer 46

• The term ‘global shift’ describes the international relocation of
  different the of industrial activity, especially in manufacturing
  industries.
• Thousands of TNCs have offshored their production facilities to
  LEDCs in order to reduce the manufacturing costs

Question 47

Give the three main costs as a result of the ‘global shift’

Answer 47

• Environment and recourse pressure
• Worker Exploitation and poor social conditions
• Social and environmental problems for deindustrialised regions

Question 48

Explain the impacts of Environmental and recourse pressures as a result of the ‘global shift’

Answer 48

• The flip-side to global economic growth is the acceleration of
  environmental decline
• Forested land has been sacrificed to urbanisation, logging and cash
  cropping
• Since 1990, Togo has lost 60% of its forest area; Nigeria’s forests
  have halved
• Crop land has been ruined by over-exploitation, mining and soil
  erosion.
• Land degradation and biodiversity loss are widespread in Indonesia,
  where an area of rainforest as big as 100,000 football pitches are
  lost each year to make room for oil-palm plantations and mining
  operations

Question 49

Explain the impacts of Worker Exploitation and poor environmental/social conditions as a result of the ‘global shift’

Answer 49

• Communities within many developing economies have experienced
  major environmental problems as a result of the global shift
• Adverse impacts on the health and well-being of people have
  resulted from pollution, over-exploitation of resources and the
  dumping of industrial waste
• In Ivory Coast, tens of thousands of Ivorians suffered from ill health
  after toxic waste was dumped by a ship owned by a European TNC
• Air pollution in Chinese cities has reduced Chinese life expectancy
  by five years
• In India, where call centre employment has been outsourced too
  due to the large English-speaking population, workers are easily
  exploited into 10-hour shifts, 6 days a week

Question 50

Explain the impacts of Social and environmental problems for deindustrialised regions as a result of the ‘global shift’

Answer 50

• Global shift creates challenges for developed countries
• During the 1970s, many European and American factory workers lost
  their jobs
• Western factories closed in large numbers once Asia became the
  focus of global manufacturing
• Issues such as high unemployment, rising crime, depopulation and
  dereliction occurred
• In some low-income US urban districts – which were hit hard with
  the effects of de-industrialisation – life expectancy is 30 years lower
  than in affluent districts.
• Detroit has lost 1 million residents since 1950, which has caused the
  catastrophic collapse in house prices and created 20,000
  abandoned properties
• The combination of manufacturing industry closures, falling house
  prices and rising crime has resulted in widespread environmental
  dereliction.

Question 51

Give the benefits created by the ‘global shift’

Answer 51

• Poverty reduction and waged work
• Education and training
• Infrastructure and, the built environment

Question 52

Explain the impacts of Poverty reduction and waged work as a result of the ‘global shift’

Answer 52

• Worldwide, 1 billion have escaped US$1.25-a-day poverty since 1990 – with 500 million of these being from China alone
• The term ‘new middle class’ is used to describe the growing mass of
  urban and working people who have escaped rural poverty
• Many earn between $US10 and $US100 per day

-	By 2030 it is predicted that Asia will be home to 3 billion middle-
        class people 

• As conditions improve, people are enjoying large income gains –
  more people can now afford smartphones and fridges – in China, car
  ownership has gone from 1 in a hundred to 1 in 5 since 2000

Question 53

Explain the impacts of

Education and training as a result of the ‘global shift’

Answer 53

• Throughout Asia, education has improved in recent decades
• Around 2500 universities in China, India and South Korea award
  millions of graduate degrees each year.
• China alone awarded 30,000 PhDs in 2012
• Asian countries now play a leading role in quaternary sector
  research in biotechnology and medical science

Question 54

Explain the impacts of Infrastructure and, the built environment as a result of the ‘global shift’

Answer 54

• Alongside economic take-off, infrastructure development has taken
  place, bringing modern motorways, high-speed railways and airports
  to major cities including Jakarta
• There is a growing trend for extreme high-rise development in city
  centre hotspots in major Asian cities

Question 55

What is a megacity?

Answer 55

• A megacity is home to 10 million people or more
• They growth through a combination of rural-urban migration and
  natural increases

Question 56

What three main factors cause rural-urban migration

Answer 56

• Urban pull
• Rural push factors
• ‘shrinking world technology’

Question 57

Explain how urban-pull factors influence rural-urban migration

Answer 57

• The main factor almost everywhere is employment
• FDI by TNCs in urban parts of poorer countries provides a range of
  work opportunities and their supply chains
• Urban areas offer the hope of promotion and advancement into
  professional roles that are non-existent in rural areas
• Schooling and healthcare may be better in urban areas, making
  cities a good place for young migrants with aspirations for their
  children

Question 58

Explain how Rural push factors influence rural-urban migration

Answer 58

• The main factor is usually poverty, aggravated by a lack of jobs
• Agricultural modernisation reduces the need for rural labour
• Recourse scarcity in rural areas with population growth triggers
  conflict

Question 59

Explain how ‘Shrinking World’ technology influences rural-urban migration

Answer 59

• Rural dwellers are gaining knowledge of the outside world and its
  opportunities
• As poor individuals in Africa and Asia begin to use inexpensive
  mobile devices, information is being shared and they are being
  ‘switched on’ to globalisation
• Transport improvements, such as South Americas famous Trans-
  Amazon Highway, has removed intervening obstacles to migration

Question 60

Mumbai (Megacity growth case study)

Answer 60

• India’s Mumbai urban area is home to 22 million people, having
  more than doubled in size since 1970
• People have flocked there from the impoverished rural states of
  Uttar and Pradesh
• Urban employment covers a range of economic sectors and skill
  levels
• Big global brands such as the Hilton and Starbucks are present in
  Mumbai
• The senior management of large TNCs such as Tata and Reliance
  Industries, some of whom are billionaires has driven up housing
  prices in Affluent areas
• In contrast; Dharavi is a slum housing area - It has a buoyant
  economy (5000 employed in Dharavis plastics recycling industries)

Question 61

Karachi (Megacity growth case study)

Answer 61

• Approximately 24 million people live in Karachi
• Pakistan’s centre of finance, industry and trade
• People flock to the city from rural areas all over Pakistan
• Range of industrial sectors including shipping, banking, retailing and
  manufacturing
• Population increase overtime is mainly due to internal migration,
  through international migrants from other South Asian countries

Question 62

Define Global Hub

Answer 62

Highly globally-connected city

Examples of ‘Global Hubs’ or ‘World Cities’ include New York, Mumbai, London, Beijing, Tokyo and Sao Paulo

Question 63

Explain the three type of population movement that allow the development of a global hub

Answer 63

Elite international migrants: Highly skilled migrants and/or socially influential individuals. Their wealth derives from their profession or inherited success. Most countries welcome highly skilled and extremely wealthy migrants.

Low-waged international migrants: Drawn towards global hubs in large numbers. London, LA, Dubai etc. are all home to a large number of legal and illegal immigrants working for low pay in Kitchens, construction sites or as domestic cleaners.

Internal (rural-urban) migration : Is the main driver of city growth in global hubs in developing and emerging economies but plays a lesser role in Europe and North America

Question 64

Impacts of migration?

Answer 64

• There are multiple costs and benefits of migration
• There are impacts from both the source and hosts
• These impacts are further subdivided into economic, social, political
  and environmental effects (which may all be interconnected)

Question 65

Give the benefits of migration to the host and source region

Answer 65

Host:
 Fills particular skills shortages (Indian doctors)
 Economic migrants willingly do labour work that locals may be
reluctant
 Working migrants spend their wages on rent, benefiting landlords,
and pay tax on legal earnings
 Larger workforce
 Prevent ageing population

Source:

 Migrants remittances can contribute to national earnings significantly
 Less public spending on housing and health (unemployment in
Poland decreased by a half since joining EU in 2004)
 Migrants or their children may return, bringing new skills
 Wealth from remittances
 Source country has international links

Question 66

Give the costs of migration to the host and source region

Answer 66

Host:
 Social tensions arise if citizens of the host country believe migration
has left to a lack of jobs or affordable housing
 Political parties change their policies to address public concerns
 Local shortages of primary school places due to natural increase
among a youthful migrant community
 Increased birth rate
 Stress on services

Source:
 The economic loss of a generation of human recourses, including
key workers such as doctors and teachers
 Reduced economic growth as consumption falls
 The closure of urban services and entertainment with a young adult
market
 Reduced population size

Question 67

Define interdependence

Answer 67

Over time, international migration makes places interdependent. Each country depends on the economic health of the other for its own continued well-being.

Question 68

Define cultural diffusion

Answer 68

The spread of cultural beliefs and social activities from one group of people to another. Through cultural diffusion, horizons are broadened, and people become more culturally rich.

Multiple factors can influence the level of cultural diffusion that takes place, this includes: TNCs, Global Media and Migration & Tourism

Question 69

How do TNCs impact cultural diffusion

Answer 69

• The global dispersal of food, clothes and other goods by TNCs has
  played a major role in shaping a common culture
• Some corporations, such as Nike and Apple have rolled out ‘uniform’
  products globally, bringing cultural change to places
• When TNCs engage with new markets, they adapt their products
  and services to suit places better (Glocalisation) and this increasing
  reflects local cultures

Question 70

How does the Global Media impact cultural diffusion

Answer 70

• Media giant Disney has exported its stories of superheroes and
  princesses everywhere
• The BBC helps maintain the UK’s global cultural influence overseas
• Often, reality and celebrity shows, are entirely re-filmed for different
  national markets

Question 71

How does migration and tourism impact cultural diffusion

Answer 71

• Migration brings enormous cultural changes to places
• Europeans travelled widely around the world during the age of the
  empires, taking their languages and customs with them
• Migrants can affect the culture of host regions, but changes are
  often partial: e.g. in India, the colonialist influenced the language and
  social activities such as Cricket on the population, but few others.
• Tourists introduce cultural change to the places they visit

Question 72

What are the costs and benefits of cultural diffusion

Answer 72

costs:
- Some people are concerned that languages around the world are disappearing as use of English continues to spread – 4 billion people speak ‘Globish’ (a form of basic English consisting of around 1500 words)
- Some locations face the loss of traditional foods, music, clothes, social beliefs and languages

Benefits:
- it has allowed worldwide changes in attitudes towards disabled people – shown with the Paralympics

Question 73

Indigenous people of Amazonia and Papua New Guinea (Cultural Erosion impacts case studies)

Answer 73

• Amazonia and Papua New Guinea’s tropical rainforest tribes are
  among the world’s last isolated groups of indigenous people
• More western members of rainforest tribes are becoming aware of
  Western culture and lifestyles
• Today, many Amazonians and New Guineans are wearing modern,
  Westernised clothing
• Increasingly, many young Amazonians are moving from the
  rainforest to urban areas like Manaus
• Indigenous people no longer value ecosystems the way they used
  to, on account of cultural erosion
• They want income, education and health improvements for their
  children – inevitably, social goals are becoming more important and
  this has driven many indigenous people to hunt endangered species
  for food or to sell.
• Papua New Guinea’s Tree Kangaroo is under threat

Question 74

How has resistance to globalisation developed

Answer 74

• At a range of geographical scales, there is opposition to
  globalisation
• individuals, pressure groups and governments may all experience
  some degree of concern with the cultural impacts of globalisation –
• In addition to its social, economic or environmental consequences
• France is fiercely protective of its culture and language - the French
  government is extremely supportive of French film makers and
  subsidises works filmed in the French language – under local
  content law – 40% if television output must consist of French
  productions
• Amnesty international has accused oil firms such as Shell and
  ExxonMobil of bringing great environmental damage to Nigeria and
  other countries

Question 75

What are the 5 single and composite measures of economic and social development

Answer 75

Income per capita

Gross Domestic Product (GDP)

Human Development Index (HDI)

Gender Inequality Index (GII)

Environmental Performance Index (EPI)

Question 76

What is Income per capita

Answer 76

• The mean average income of a group of people
• Calculated by taking a source of income for a country and dividing it
  by population size

Question 77

What is Gross Domestic Product (GDP)

Answer 77

• Final value of the output of goods and services inside a nation’s
  borders
• Includes the value added by foreign-owned businesses that have
  located operations there

Question 78

What is the Environmental Performance Index (EPI)

Answer 78

• Measures environmental pollution
• Environmental quality is often poor in developing and emerging
  economies – it usually improves as economic and social
  development occurs
• Improves as places make the transition from industrial to post-
  industrial forms of economic activity

Question 79

What global economic trends have resulted from globalisation in terms of human impact

Answer 79

Global trends indicate a widening income inequality (Measured using Gini coefficient)

• The great gains made by European and North American nations
  over the same time period has resulted in a widening of the average
  income gap between people living in the world’s wealthiest and
  poorest countries
• In Africa, large income gains have been made in countries such as
  Tunisia, Algeria and other North African countries – which have
  become very ‘switched on’ to globalisation – A strong African
  middle-class is expected to rival Asia in the coming decades
• Yet, in contrast, in other areas of Africa, such as sub-Saharan
  countries including Burundi and Central African Republic –
  geographical isolation, poverty and political extremism has resulted
  in falling life expectancy due to conflict

Question 80

What social issues have been created by open door policies

Answer 80

• Open door policies have brought rapid cultural change
• In 2004, the EU opened up its borders to eight Eastern European
  nations which brought an unprecedented volume and rate of post-
  accession in-migration
• In the UK, where Polish immigration has been largest – many non-
  Polish residents have welcomed the new arrivals and their
  contribution to the local economy and society – however, some local
  people worry that young migrants have increased the crude birth rate
  beyond the capacity of the area’s primary schools

Question 81

Extremism in Europe (Impact of Immigration case study)

Answer 81

• In many EU states, nationalist parties, such as France’s Front
  National and the UK’s United Kingdom Independence Party (UKIP)
  has commanded significant support
• This is often due to their string rejection of immigration and
  multiculturalism
• In France in 2015, staff of the satirical magazine Charlie Hebdo were
  killed by gunman of Algerian descent – who claim their Islamic faith
  had been mocked
• Events such as these are rare, however, demonstrate the tensions in
  multicultural Europe
• It is clear there is a growing ant-immigration sentiment in Europe – In
  the 2014 European Parliamentary elections – around 25 percent
  supported France’s Front National Party

Question 82

How has legislation been used to prevent global flows of people

Answer 82

• Governments may try and prevent or control global flows of people,
  goods and information, with varying success
• Laws can be strengthened to limit numbers of economic migrants,
  however, illegal immigration can be hard to tackle

Question 83

How have countries attempted to prevent cultural diffusion of Western media into Chinese society

Answer 83

• Around 40 world governments limit their citizen’s freedom to access
  online information
• In China, the government restricts access to google, Facebook,
  Twitter and YouTube in a system called the ‘Great firewall of China’ -
  more than 400 million Chinese citizens interact with one another
  using vetted social media sites approved by the Chinese
  government

Question 84

How have countries attempted to resist unfair trade practices

Answer 84

Trade protection is still common – USA has a complete trade embargo on Cuba while in New Zealand imports of honey from Australia have been banned for 50 years

Question 85

How has recourse exploitation impacted the First Nations in Canada

Answer 85

• Canada is home to six groups of indigenous people
• Tribes located in the Yukon River Basin oppose the attempts of
  global oil companies to ‘switch on’ their region
• Over 200 million barrels of conventional oil has been extracted
  there since 1920
• The death of trout and other fish in oil-polluted lakes – which is
  fundamental to the cultural identity of the Dene’s tribe
• The effects of alcohol and drugs (brought by oil workers) on the
  behaviours of young Dene people

Question 86

What are the fundamental links between globalisation and rising environmental insecurity

Answer 86

- Food Insecurity: By 2050, food demand is likely to double worldwide 
  and growing Middle-class diets are characterised by their consumption 
  of meat and dairy and have a larger ecological footprint 

• Water insecurity:- As societies develop economically and urbanise,
  everyday household water use increases significantly. Food production
  depletes water supplies. Animal husbandry and crop production can be
  water-intensive activities
• Energy: 50 percent increase in global energy is predicted by 2035
  Unless significant innovation in terms of clean energy is achieved –
  fossil fuel consumption will continue to rise
• Climate: The global diffusion and adoption of manufactured items has
  increased the global carbon footprint. The harmful global temperature
  rise in excess of 2 degrees now appears inevitable

Question 87

Define Ecological Footprint

Answer 87

A measurement of the area of land or water required to provide a person or a society with the energy, food and resources needed to live

Question 88

Define Water Footprint

Answer 88

A measure of the amount of water used in the production and transport to market food and commodities

Question 89

Define Carbon Footprint

Answer 89

The amount of carbon dioxide produced by an individual or activity

Question 90

Define sustainability

Answer 90

Meeting the needs of the present without compromising the ability of future generations to meet their own needs

Question 91

Explain the three different types of sustainability

Answer 91

Economic sustainability : Individuals and communities should have access to a reliable income over time

Social sustainability: All individuals should enjoy a reasonable quality of life

Environmental sustainability: No lasting damage should be done to the environment; renewable recourses must be managed in ways that guarantee continued use

Question 92

Explain what local sourcing is and it’s impacts

Answer 92

• The critics of global capitalism say environmental costs should be
  accounted for in the pricing of products
• low pricing of containerised transport allied with cheap labour and
  material costs in developing cost has helped TNCs build extensive
  global production networks – these strategies maximise profits, but
  they also maximise carbon footprints
• It is argued – is it environmentally sustainable to transport a bottle of
  water 20,000km just to reach the UK – as a result some people buy
  locally
• Local sourcing has allowed UK farmers to move up the value chain
  by producing locally produced items – while also helps reduce
  carbon footprint sizes
• However, it can be expensive particularly for people on low incomes
  and can have impacts on LEDC producers that currently rely on the
  UK for exports

Question 93

The Eden Project (Local sourcing case study 1)

Answer 93

• Popular tourist site in Cornwall
• Houses plants from all over the world in two enormous biomes
• For the 600,000 meals that are provided annually for visitors 90 per
  cent of the produce is bought from local suppliers in Cornwall and
  Devon

Question 94

Todmorden

Local sourcing case study 2

Answer 94

• Todmorden is a down in the South Pennines
• Much of the food on sale is locally grown
• The ‘IET’ campaign, which received National Lottery funding, aims to
  encourage consumers and growers to work together for the long-
  term good of the planet
• IET has created 40 public fruit and vegetable gardens and stages
  regular educational talks and events in the town

Question 95

How has globalisation led to the development of ethical consumption

Answer 95

• While consumers benefit economically from global shift’s cheap
  goods, many have ethical concerns about the social costs of worker
  exploitation
• Ethical purchases are increasingly available as a result of the work of
  NGOs, charities and a growing number of businesses with a ‘social
  responsibility’ agenda

Question 96

Rana Plaza collapse

The development of Ethics in business case study

Answer 96

• Recent events have shown that Western retailers are increasingly
  beginning to take more responsibility for working conditions in their
  supply chains
• In 2013, the Rana Plaza building collapsed which led to the death of
  1100 textile workers – on the day of the collapse workers were sent
  back into the building to complete international orders in time for
  delivery for western companies such as Primary ad Wal-Mart
• Since then, many British TNCs have signed the Accord, which is a
  legally binding agreement on worker safety – these companies now
  promise to ensure safety checks are carried out regularly in all
  Bangladeshi factories

Question 97

Give three ethical consumption schemes

Answer 97

• Fairtrade
• NGO action
• Supply chain monitoring

Question 98

Evaluate Fairtrade as an ethical consumption scheme

Answer 98

• The Fairtrade Foundation’s certification scheme offers guaranteed
  higher income to farmers and some manufactures, even if the
  market price changes
• Commonly used in products such as coffee, chocolate, bananas and
  wine

Positives:
- Fairtrade goods let shoppers know that what they spend will find its
way into the pay packets of poor workers

Negatives:
- However, as the number of schemes grow, it becomes harder to
ensure that money has been correctly distributed
- It is also not possible for all the worlds farmers to join a scheme
offering a high fixed price – it is economically unsustainable

Question 99

Evaluate NGO action as an ethical consumption scheme

Answer 99

• NGOs are extremely powerful in promoting economic consumption

Positives:
- After pressure from NGOs - Tesco recognised the issues and told a
farm in South Africa it would use a different fruit supplier unless
conditions for women improved

Negative:
- However, NGOs have limited financial recourses, which limits the
scale of what they can achieve

Question 100

Evaluate Supply Chain Monitoring as an ethical consumption scheme

Answer 100

• Large businesses increasingly accept the need for corporate social
  responsibility
• The largest TNCs have thousands of suppliers which increases the
  risk of branded products being linked with worker exploitation

Positive
- Firms such as GAP and Nike now prohibit worker exploitation in their
own foreign factories

Negative
- However, it is hard to monitor the working conditions and pay for the
workforce of every single supplier they buy from

Question 101

Evaluate recycling as a method of reducing the rate of recourse consumption

Answer 101

• Recycling is far more sustainable than sending waste to landfill –
  reducing the rate at which new natural recourses are used
• High levels of energy are still required are stull high due to the
  treatment of waste and the transportation of waste to recycling sites
• In Curitiba, Brazil, there are strong recycling schemes, whereas in
  other places such as India, recycling systems have failed to develop
• However, the future for recycling is strong – products in the future
  could be designed in a specific way that allows them to be
  disassembled and reused or repurposed far more easily

Question 102

Evaluate the impact of the global shift on Indonesia

Answer 102

• Since rapid developed of SEZ’s in the 1980s the country has
  developed into the largest economy in South East Asia
• Poverty rate fallen from 60% to 15%
• The country’s main exports are led by palm oil and coal
  briquettes, with jewellery, cars and vehicle parts, rubber, and
  copper

Question 103

Evaluate transmigration in Indonesia

Answer 103

Source: Over populated islands of Indonesia, for example, Java.
Destination: Under populated outer Islands such as Maluku.

Consequences for area they arrive in:

• In total over three million people have moved so this obviously puts great pressures on the areas they arrive in.
• Thousand of acres of rainforest have been cleared and this has led to soil erosion.
• Consequently, a large quantity of the land soon becomes unsuitable for farming.
• This is made worse by the shortage of tool and destruction of crops by wild animals.
• There has been friction with the migrants and the indigenous population.
• Trans-migrants receive two hectares of land as an incentive to move.
  Indigenous people see this as government favouritism.
• The tension is accentuated as sometimes migrants are given areas of land that locals used for shifting cultivation.

Consequences for area they leave:

• The population on main Islands like Java is continuing to grow rapidly and the trans-migration scheme is providing minimal relief.
• Also many trans-migrants are returning after having little success on the outer Islands. Transmigration has done little to remove the
  problems of over-population.

Question 104

Evaluate rural to urban migration in India

Answer 104

Source: Rural areas and small town’s among Calcutta.
Destination: Calcutta’s Bustees (Shanty Towns).

Reasons

• Large population growth in rural areas puts more pressure on the environment.
• Wages in Calcutta are approximately six times that of rural areas.
• Sub-division of land passed on makes a subsistence life more difficult and reduces the assets against which a rural inhabitant could get
  a loan.
• Increased mechanisation of agriculture to feed growing population means greater rural unemployment.
• A large number of migrants are a consequence of natural disasters such as those faced annually in the Monsoon season. Many cross
  from nearby Bangladesh.
• Indian cities receive approximately six times the investment of their rural counterparts.
• Better medical and health care. Infant mortality is lower in Indian cities than rural areas.

Consequences for area they arrive in:

In Calcutta they include:

• A chance to escape the rigid caste system that is still very strong in rural areas.
• Higher rates of infant mortality than towns.
• Half a million people sleeping on the streets.
• Increased air pollution as the pressures of population create a need for more industry. In addition, people use wood and charcoal for
  cooking.
• The old water system cannot cope. Leaking pipes allow contamination to enter the water supply. In Monsoon season, this is particularly
  bad as sewage infects the water.
• Increased traffic causes greater air pollution problems. As many as 60% of the population suffer from breathing problems.

Consequences for area they leave:

• If the migrant finds work in the city then it is likely that the village he left will benefit from money sent home. This is what every migrant
  dreams of but the situation in reality is usually very different.
• As the pressures of urbanisation increase so government expenditure on urban areas must increase this leaves the rural areas facing
  an ever more difficult situation.
• Lack of investment on health and welfare will have obvious effects for those left behind.
• It is the young motivated male that is most likely to leave.
• This has implications for those left behind. There will be a predominantly elderly population that will find it ever more difficult to support
  themselves.
• Whilst migration may ease some of the population pressures the high birth rates in rural areas means the situation is deteriorating. This
  means a constant loss through migration with the break up of families.

Question 105

Define Protectionism

Answer 105

the institution of policies, quotas, regulations that protect a country’s industries against competition from cheap imports.

Question 106

The Natural Resource Trap

Answer 106

As exports of the natural resource increases, the value of a country’s national currency becomes stronger.

Therefore, other economic activities within the country become less competitive (e.g. manufacturing) because their product becomes more expensive than other countries’ products.

So the country’s domestic market suffers as people look elsewhere to buy products from abroad.
A good safe economy needs a balance.

Primary product dependency is dangerous.

Question 107

Locational Advantage in trade

Answer 107

Some countries/cities are strategically located along important trade routes, giving them a big advantage in international trade.

Question 108

What is Dutch Disease:

Answer 108

Dutch disease is an economics term that refers to the negative consequences arising from large increases in the value of a country’s currency.

It is usually associated with a natural resource discovery but can be a result from any large influx of foreign currency into a country (FDI – foreign direct investment), aid or a marked increase in natural resource prices.

North Sea oil:
1970s oil price x 3. Extraction becomes profitable off Scottish Coast. UK becomes oil exporter. Value of pound increases, prices increase. Britain goes into recession as people want wage increase and other domestic exports too costly.

Question 109

What is Rostows 5 stage model

Answer 109

1. Traditional society - subsistence, barter and agriculture…
   dependent on rural economy
2. Transitional stage - specialisation, surpluses,
   infrastructure - dependent on social appreciation of
   education and skill development
3. Take Off - Industrialisation, growing investment, regional
   growth, political change - dependent on Sub-urban
   economy
4. Drive to Maturity - diversification, innovation, less
   reliance on imports, investment - dependent on growth
   and developed economies
5. High mass consumption - consumer oriented, durable
   good flourish, service sector becomes dominant -
   dependent on global economy or market managing
   economies

Question 110

Nigeria exports

Answer 110

97% of exports are Oil and natural gas

Question 111

Egypt exports

Answer 111

77% of exports are Oil and Cotton

Question 112

Cuba exports

Answer 112

77% of exports are Sugar and Tobacco