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geography edexcel > Globalisation EQ1 > Flashcards

Globalisation EQ1 Flashcards

1
Q

3.1 What is globalisation?

A

The process by which people, culture, finance, goods, and information transfer between culture with few barriers, leading to a developed globally integrated economy.

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2
Q

3.1 explain time-space compression and shrinking world

A

Physical distances haven’t changed, but developments in technology have massively reduced the time it takes to trade and communicate globally. Developments in transport have also reduced travel times, so greater distances can be covered in less time

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3
Q

3.1 what is interdependence?

A

Economic problems in one country can quickly impact it’s trading partners on the other side of the world. For example, following the 2011 Tohoku Japan tsunami, Honda factory workers in Swindon could only work 2 days a week due to a shortage in car parts

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4
Q

3.1 outline containerisation

A

larger loads produce an ECONOMY OF SCALE, a reduced cost per unit output. The large distances mean the size of ships is important in order to reduce costs, ships can now carry 20,000 containers.

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5
Q

3.1 Name some 19th century transport developments

A

Railway in 1830s
Steam ship 1840s

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6
Q

3.1 Name some 20th century transport developments

A

Jet aircraft 1960s
containerisation 1960s

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7
Q

3.1 outline technological innovations that have dominated globalisation

A

PHONES: real time global communication
FIBRE OPTICS: data transfer is rapid
GPS: satellites allow tracking
INTERNET: 40% of the world have access
SOCIAL MEDIA: deeply influential

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8
Q

3.2 What does the world bank do?

A

IGO which uses bank deposits placed by the world’s wealthiest countries to provide loans for countries in need. Recipient countries must agree to certain conditions concerning repayment and economic growth. Also focuses on natural disasters and humanitarian aid.

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9
Q

3.2 What does the IMF do?

A

IGO- purpose to maintain international financial stability. In return for loans, the IMF tries to force countries to privatise government assets to increase size of the private sector and generate wealth. Many believe that this policy has forced poorer countries to sell off their assets to wealthy TNCs. It also exists to stabilise currencies in order to maintain economic growth

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10
Q

3.2 what does the WTO do?

A

IGO- promotes the free flow of trade via trade liberalisation, to prompt economic growth, especially in poorer countries. Believes in free trade and removal of trade barriers, seek to encourage all trade between countries to be free of tariffs, quotas, and restrictions. These intergovernmental organisations increase global integration and the flow of goods, capital, and knowledge over borders, this encourages foreign direct investment from large TNCs.

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11
Q

3.2 What is a tariff?

A

a tax on imported goods and services to make them more expensive for consumers to buy to restrict demand and protect their business

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12
Q

3.2 What is a quota

A

A government imposed trade restriction to limit the monetary value of goods that a country can import or export in a time period

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13
Q

3.2 What are subsidies

A

benefits provided by the government to producers e.g tax pardons.

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14
Q

3.2 How can a government encourage globalisation by privatisation?

A

PRIVATISATION: 1980s, assets like railways and utilities were owned and run by the government. Thatcher privatised to allow private companies to buy and run these services. This causes a large inflow of money, many argue that it has resulted in reduced quality of services, such as contaminated water.

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15
Q

3.2 how can a government encourage globalisation via encouraging business start up

A

incentives like grants and tax breaks are provided to attract businesses, perhaps TNCs who see the area as advantageous

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16
Q

3.2 how can governments encourage globalisation via foreign direct investment

A

results in the increase of economic and industrial activity within a country- via offshoring, foreign mergers, foreign acquisitions, and PPP.

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17
Q

3.2 How can a government hinder globalisation via censorship

A

restricting access to information and internet, providing propaganda e.g. in North Korea

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18
Q

3.2 How can a government hinder globalisation via limiting migration

A

preventing the spread of different cultures

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19
Q

3.2 how can a government hinder globalisation via trade protectionism?

A

subsidies, tariffs, and quotas to protect their domestic industries from foreign competition.

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20
Q

3.2 What are some benefits of trade blocs?

A
  • wider market so larger revenue
  • other businesses can prosper
  • trade is more reliable and less economic risk
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21
Q

3.2 What are some setbacks of trade blocs

A
  • exclusion and isolation
  • other countries can’t compete
  • don’t guarantee fair treatment in the bloc
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22
Q

3.2 outline the USMCA

A

a trade bloc of the USA, Canada and Mexico. Began on 1st January 1994.It removed the vast majority of trade barriers between the nations (trade liberalisation) allowing free trade. They also make deals together

23
Q

3.2 What is a special economic zone

A

An area where businesses can import raw materials, process, manufacture, and re-export them paying reduced tariffs or taxes. This cuts costs to earn more profit. They have economic laws which are more liberal and open, so easier for TNCs to operate here

24
Q

3.2 How did China contribute to the spread of globalisation

A

1978 open door policy- companies rapidly outsourced and relocated to one of four SEZs to take advantage of tax incentives and huge pools of cheap labour. Joined WTO in 2001

25
Q

3.2 How can a government or country attract FDI?

A
  • lower corporation tax
  • tax holidays
  • preferential taxes
  • subsidised land
  • easier VISAs
  • subsidise infrastructure
26
Q

3.3 What does the KOF index measure?

A

measures globalisation in countries in three dimensions giving them a score up to 100.
SOCIAL GLOB: spread of ideas, information, migration 39% weight
ECONOMIC GLOB: trade, FDI 37% weight
POLITICAL GLOB: membership in IGOs, embassies, political co-operation 24% weight

27
Q

3.3 What does the AT Kearney global cities index measure

A

measures globalisation in cities based on five measures
BUSINESS ACTIVITY: capital, TNCs
HUMAN CAPITAL: education
CULTURAL EXCHANGE: sports, museums
POLITICAL ENGAGEMENT: embassies, IGOs

28
Q

3.3 what is GDP per capita

A

the total value of goods and services provided by a country in a year, divided by its population. a problematic measure as it does not represent regional disparity, informal employment, a single criteria measure

29
Q

3.3 what is HDI

A

a composite measure of development that takes into account
- life expectancy
- literacy rate
- GDP
a better indicator of globalisation as it is composite and combines multiple factors

30
Q

3.3 name some strengths of the KOF index

A
  • wide range of globalisation data (24 variables)
  • weighted system
  • easy comparison- data is available for 158 nations
31
Q

3.3 name some weaknesses of the KOF index

A
  • bias- smaller countries are over-represented at the top (belgium, ireland etc), as FDI is a higher proportion of their GDP
  • informal economy discounted
  • illegal migrants not included
  • how have they selected weightings of importance?
32
Q

3.3 name some strengths of the AT kearney global cities index

A
  • 27 variables
  • extra weight to more important , measures
  • comparison between cities over time
  • helps identify global hubs
33
Q

3.3 Name some weaknesses of the AT Kearney index

A
  • not always available so data gaps
  • how they decide weightings?
  • hard to measure cultural exchange
34
Q

3.3 what is a TNC?

A

a company that operates in more than one country. they grow by offshoring and outsourcing

35
Q

3.3 what is offshoring?

A

when a company moves part of it’s operations to another country

36
Q

3.3 what is outsourcing

A

when some of the business is contracted out to another country.

37
Q

3.3 what company is an example of a TNC in many countries

A

Astrazeneca- one of the worlds largest pharmaceutical companies- employing more than 50,000 people in over 100 countries across six continents

38
Q

3.3 why would a TNC want to grow?

A
  • access new markets
  • lax rules and laws
  • corruption
  • cheaper land costs
  • gain grants and tax breaks
  • to operate in trade blocs
  • cheaper labour
  • access skilled labour
39
Q

3.3 what is glocalisation?

A

when global firms and brands adapt their products to increase customer appeal in local markets e.g. McDonald’s veggie burgers in India, as Hindus don’t eat beef. They adapt their products due to cultural preferences, religious objections, wealth, and availability of resources

40
Q

3.3 what are positive impacts of TNCs on a host country?

A
  • provides employment using local labour
  • TNC investment and FDI triggers a + multiplier effect so boosts economic growth
  • investment in infrastructure
  • introduces new skills and tech
  • raises political stability by creating jobs and incomes
  • raises standards of living
  • product availability
41
Q

3.3 name some negative impacts of TNCs on a host country?

A
  • small local businesses can’t compete
  • control over gov
  • could remove operations at any time- not loyal
  • environmental degradation
  • may avoid paying taxation
  • labour is low paid and can be exploitative
  • products or services created often too expensive for locals
  • needs of host country rarely considered
42
Q

3.3 How do TNCs facilitate globalisation?

A
  • bolt together nations markets
  • global supply chain
  • global flows of trade
  • cause FDI inflow
  • share global cultures through product and corporate culture
43
Q

3.3 what is a foreign acquisition?

A

a company buys and takes control of another company in another country, or the company that is bought - all the shares are bought = dominating control over the company

44
Q

3.3 what is a foreign merger?

A

two firms merge together to form one entity e.g. Vodafone and Three in two countries (Netherlands and the UK)

45
Q

3.3 what are some historical factors why a country remains detached from globalisation

A
  • war and civil unrest
  • language
  • colonialism
46
Q

3.3 what are some physical factors why a country remains detached from globalisation

A
  • proximity to other switched on nations
  • coastline for easy trade
  • vulnerability to natural hazards
  • agricultural ability
  • landlocked
47
Q

3.3 what are some economic factors why a country remains detached from globalisation

A
  • openness to trade
  • infrastructure
  • labour forces and education
48
Q

3.3 what are some political factors why a country remains detached from globalisation

A
  • clear and effective laws for business
  • political stability or isolation
  • corruption
  • trade blocs
49
Q

3.3 what are some environmental factors why a country remains detached from globalisation

A
  • amount of resources
  • landscape and terrain
  • climate
  • energy reserves
50
Q

3.3 what is the HIPC

A

the ‘heavily indebted poor countries initiative’. designed to ensure the worlds poorest countries are not overwhelmed by unmanageable debts.

51
Q

3.3 why are large parts of Africa switched off?

A

CORRUPTION: many societies suffer from abuse of authority
LOW GOV SUPPORT: lack of volume of business is harder for TNCs to gain incentives
UNSKILLED LABOUR: poor education
POLITICAL INSTABILITY: civil wars e.g. Sudan
WEAK MARKET: wages not high enough to trigger multiplier effect
- UNSTABLE CURRENCIES: rapidly changing exchange rate would be financial suicide for TNCs
POOR INFRASTRUCTURE: international debts so lack of investment.

52
Q

3.3 outline why zambia is a switched off country?

A
  • landlocked
  • reliant on exports so relies on good relations to access tanzanian and angolan ports
  • 8th largest exporter of raw copper, demand has decreased due to use of fibre optics rather than copper wires.
53
Q

3.3 what is the cumulative causation theory?

A

affluence is further promoted by affluence. Explains why wealth becomes concentrated in certain places. Basically areas which are switched on (cores) are best connected so attract more investment and trade and so in turn remain well connected

geography edexcel (9 decks)

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