Globalisation and Ethics

Question 1

What is globalisation?

Answer 1

The interconnection between countries made possible by development and transport. It involves the movement of goods, services, money and people.

Question 2

What does globalisation affect?

Answer 2

The decisions regarding businesses locations

Question 3

What are the benefits of globalisation

Answer 3

• There have been an increase of knowledge and skills which led to increase use of techology and more efficient production
• More competition means firm are more efficient so consumers have more choices at lower prices of better quality or designed products
• Sell at cheaper costs due to easier access to raw materials or climate advantages or skilled labour. Globalisation has impacted where businesses locates
• Increased markets for businesses and better distrubution

Question 4

What are the drawbacks of globalisation?

Answer 4

• Businesses have cheaper costs and large scale production shutting down small businesses. Small firms face competition through imports
• Multinational firms are very powerful
• Some complete industries are closed which causes for a new businesses and training for the unemployed workers who lost their jobs. eg, coal mining gone so coal miners have to find other things
• Decrease in skilled manufacturing and increase in service sector causing low level service jobs
• If one economic change in one country, it will affect other economies.

Question 5

What are tariffs?

Answer 5

Tariffs are taxes imposed on imported goods

Question 6

What are the effects of tariffs?

Answer 6

• They let businesses which produce similar products within home or domestic country to gorw and survive againast foreign competition
• get in the way of globalisation: wide use of import tariffs would encourage people to buy homeproduced goods and therefore stop the growth of global trade
• increase the cost of living for consumers, effectively reducing a household’s living standards since if import prices go up, everyone’s pay packet buys a bit less, making people worse off

Question 7

What are trade blocs

Answer 7

A trade bloc is an agreement between countries to trade freely with each other behind a tariff wall that discourages outsiders.

Question 8

What effects does trade blocs have?

Answer 8

• Charge high tariggs on imported products from countries outside of the trading bloc
• Consumers have restricted choice and higher prices
• Cheaper products from countries within the trading bloc

Question 9

How do businesses compete internationally?

Answer 9

• For small businesses e-commerce provides the opportunity to sell globally without the cost of setting up operating divisions worldwide.
• For larger businesses, the use of the internet/ecommerce may provide a dynamic business opportunity
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