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Edexcel A Level Geography > Globalisation EQ1 - Causes and acceleration of globalisation > Flashcards

Globalisation EQ1 - Causes and acceleration of globalisation Flashcards

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1
Q

What is globalisation?

A

The widening and deepening global connections, interdependence and flows (commodities, capital, information, migrants and tourists)

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2
Q

Why does modern globalisation differ from the global economy which preceded it?

A

Due to the longer (products sourced further away), deeper (being connected to other places and people) and faster connections (people able to talk to each other in real time)

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3
Q

What is GDP?

A

Gross domestic product - a measure of the financial value of goods and services produced within a territory

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4
Q

What are the most important global flows?

A

Capital, commodities, information, tourists, migrants

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5
Q

What is interdependency?

A

Two places becoming over reliant on financial and or political connections with one another

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6
Q

What is the shrinking world effect?

A

Whilst the physical distances between places remain unchanged, developments in technology and transport makes places feel closer than in the past

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7
Q

What are some of the important innovations in transport contributing to a shrinking world effect?

A

Steam power (1800s)
Railways (1800s)
Jet aircraft (Boeing 747 in 1960s)
Container shipping (around 200 mil individual container movements take place every year - intermodal containers)

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8
Q

What is spatial division of labour?

A

The common practice among TNCs of moving low-skilled work abroad or ‘offshore’ to places where labour costs are low

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9
Q

What are intermodal containers?

A

Large capacity storage units which can be transported long distances using multiple types of transport, without the freight being taken out of the container

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10
Q

What are some of the important elements of the growth of ICT over time that contribute to time space compression?

A

Telephone and telegraph (first telegraph cables across Atlantic in 1860s)
Broadband and fibre optics (more than 1.2 million km of flexible undersea cables today)
GIS and GPS (1970s)
Internet and social networks (58% of world’s population using internet)

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11
Q

How can global flows be viewed as threats?

A
  • Imports of raw materials and commodities can threaten nation’s own industries
  • Migrants can bring cultural change and religious diversity, not always welcomed
  • Information can provide citizens with knowledge own government finds threatening
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12
Q

What is FDI?

A

Foreign direct investment - a financial injection made by a TNC into a nation’s economy, either to build new facilities, or to acquire or merge with an existing firm already based there

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13
Q

What are the 3 ‘Bretton Woods institutions’?

A

International Money Fund, World Bank and World Trade Organisation

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14
Q

What is the IMF’s role in globalisation?

A

It loans from rich nations to countries that apply for help, but in return the recipients must agree to run free market economies that are open to outside investment

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15
Q

What is the World Bank’s role in globalisation?

A

It lends money on a global scale and gives direct grants to developing countries

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16
Q

What is the WTO’s role in globalisation?

A

It advocates trade liberalisation, and asks countries to abandon protectionist attitudes in favour of untaxed trade

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17
Q

How do the Bretton Woods institutions promote free trade and TNCs?

A

They have created a global legal and economic framework that is suited to free trade and foreign direct investment, allowing TNCs to thrive

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18
Q

What are the different types of FDI?

A

Offshoring - TNCs build own production facilities in low wage economies
Foreign mergers - two firms in different countries join forces to create a single entity
Foreign acquisitions - TNC launches takeover of a company in another countries
Transfer pricing - TNCs have channelled profits through a subsidiary company in low tax country

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19
Q

How are national governments key players in globalisation?

A

They promote free trade blocs and key policies (free market liberalisation, privatisation, encouraging business start ups)

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20
Q

What is free market liberalisation?

A

Governance model which follows 2 beliefs:
- government intervention in markets impedes economic development
- overall wealth increase, trickle down takes place from richest to poorest in society

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21
Q

What is privatisation?

A

Allowing foreign investors to gain a stake in privatised national services and infrastructure to help fund it

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22
Q

What does encouraging business start ups involve?

A

Methods range from low business taxes to changes in law allowing both foreign and local businesses to make more profit

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23
Q

What are trade blocs?

A

Voluntary international organisations that exist for trading purposes, bringing greater economic strength and security to the nations who join

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24
Q

What are the benefits of trade blocs?

A

Markets for firms grow through the removal of barriers to intra-community trade, enlarged market increases demand (meaning products can be sold more cheaply), smaller national firms within bloc can merge to form TNCs

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25
Q

What is the EU?

A

Formed in 1993.
27 member single market trade bloc, with a single currency (the Euro) adopted by 19 members.
Guarantees the free movement of goods, capital and people

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26
Q

What is ASEAN?

A

Established in 1967, ASEAN has 10 member states.
Uniform low tariff is applied between members for specified goods, and the agreement promotes peace and stability (members have pledged not to have nuclear weapons)

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27
Q

What are SEZs?

A

Special Economic Zones - an industrial area, often near a coastline, where favourable conditions are created to attract foreign TNCs

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28
Q

How did China’s Open Door Policy of 1978 contribute to globalisation?

A

Radical ‘Open Door’ allowed China to embrace globalisation whilst remaining under one party authoritarian rule. It gave China the nickname the ‘workshop of the world’ due to the world’s largest TNCs finally being let in to establish factories etc.

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29
Q

How is globalisation in China successful?

A

FDI from China and its TNCs predicted to total $1.25 trillion between 2015-2025
China is now part of WTO
400 million said to have escaped poverty

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30
Q

What are the drawbacks of globalisation in China?

A

Life expectancy reduced by 5 years due to air pollution in cities - worst in the world
Strict controls on foreign TNCs in some sectors
Google and Facebook have little to no access to China’s market

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31
Q

What is offshoring?

A

When TNCs move parts of their own production process to other countries to reduce labour or other costs

32
Q

What is outsourcing?

A

When TNCs contract another company to produce the goods and services they need rather than do it themselves

33
Q

How does the KOF index measure globalisation?

A

24 indicators spread over 3 categories - political, economic and social globalisation. Each indicator converted to index value, then data is analysed before comparing the new scores with previous ones dating back to 1970

34
Q

What are the cons of the KOF index?

A

Only measures international interactions (not internal) and does not include recent technological developments. Some cultural bias

35
Q

How does the A.T. Kearney Index measure globalisation?

A

12 indicators spread across 4 categories - political engagement, technological connectivity, personal contact, economic integration - complex points and weighting system.
Uses more holistic indicators than KOF

36
Q

What are the cons of the AT Kearney index?

A

Only includes 62 countries, heavy weighting given to ICT allows USA to gain high index score despite low political engagement

37
Q

What is a global production network?

A

A chain of connected suppliers of parts and materials that contribute to the manufacturing or assembly of the consumer goods - serves needs of TNC

38
Q

What is glocalisation?

A

Changing the design of products to meet local tastes or laws (common strategy used by TNCs)

39
Q

What are some examples of glocalisation?

A
  • driving seat positioned differently in US and UK
  • reality tv shows are re-filmed using local people in different countries
  • certain foods made specfically for different countries
40
Q

What is a switched off place?

A

A region or country that still lack any strong flows of trade or investment with other places and economies

41
Q

How is North Korea a ‘switched-off’ place?

A

Ruled as an autocracy, chosen deliberately to remain politically isolated from rest of the world.
Ordinary citizens have no internet acess, no undersea data cables connecting North Korea with anywhere else
As a result, North Korea has relatively low GDP and development especially as it only trades with China

42
Q

How is the Sahel region a ‘switched off’ place?

A

Economic - low income levels mean it lacks market size to attract FDI, low literacy rates makes it unattractive for offshoring
Physical - all Sahel countries are landlocked resulting in high transport costs which defers FDI
Environmental - semi arid climate becoming drier due to climate change, reducing land area available for agriculture

43
Q

What is the A T Kearney Index?

A

Measures how globalised a country has become

44
Q

What does ‘capital’ mean?

A

Money or assets

45
Q

What is capitalism?

A

A belief in a market economy, where people are free to set up businesses and keep their profits (subject to taxes), and where supply and demand determine the prices of goods and services

46
Q

What does ‘commodities’ mean?

A

Raw materials

47
Q

What is communism?

A

A belief in communal wealth where property is owned communally and wealth is distributed equally. The State owns or controls most land, as well as the banks, natural resources, and the media

48
Q

What is deregulation?

A

The reduction in rules which means that any foreign business can set up in the UK and bring its overseas staff with it

49
Q

What does ‘economies of scale’ mean?

A

The ability to reduce costs proportionately by increasing the scale of production

50
Q

What is fairtrade?

A

An independent not-for-profit organisation which aims to return a bigger proportion of the revenue to producers or growers

51
Q

What does FDI stand for?

A

Foreign Direct Investment

52
Q

What is Foreign Direct Investment?

A

Investment made by an overseas company or organisation into a company or organisation which is based in another country

53
Q

What is ‘free enterprise’

A

When companies operate in competition with each other, with minimal governmental control

54
Q

What does Gross National Income (GNI) measure?

A

The value of goods and services earned by a country (excluding overseas earnings), formerly known as Gross National Product (GNP)

55
Q

What are Inter-Governmental Organisations (IGOs)?

A

Organisations which comprise of two or more countries working together. Examples include the EU and the UN

56
Q

What does IMF stand for?

A

International Monetary Fund

57
Q

What is the role of the IMF?

A

A global organisation whose primary role is to maintain international financial stability

58
Q

What is the KOF Index?

A

An annual Index of Globalisation where a score is calculated for each country by assessing economic, social and political globalisation

59
Q

What does ‘liberalism’ mean?

A

The idea that the government’s role in business and the economy should be minimal, to allow individual decision-making, a free market and open competition between
companies

60
Q

What does ‘neo-liberalism’ mean?

A

A belief in the free flows of people, capital, finance and resources.

Under neo-liberalism, State interventions in the economy are minimized, while the obligations of the State to provide for the welfare of its citizens are diminished

61
Q

What does ‘off-shoring’ mean?

A

When a company does work overseas, either itself or using another company

62
Q

What does ‘outsourcing’ mean?

A

When work is contracted out to another company (known as off-shoring when that company is overseas)

63
Q

What is a quota?

A

A fixed level indicating the maximum amount of imported goods or persons which a state will allow in

64
Q

What is a ‘remittance payment’?

A

Income sent home by individuals working elsewhere (usually abroad but can be in urban areas)

65
Q

What is the ‘shrinking world’?

A

The concept that the world is becoming metaphorically smaller because the time it takes to trade and communicate globally has been massively reduced

66
Q

What does SEZ stand for?

A

Special Economic Zones

67
Q

What are Special Economic Zones?

A

Set up by national governments to offer financial or tax incentives to attract Foreign Direct Investment, which differ from those incentives normally offered by a country

68
Q

What are subsidies?

A

Grants given by governments to increase the profitability of key industries

69
Q

What are tariffs?

A

A tax that is paid on goods coming into or going out of a country

70
Q

What is meant by ‘space-time compression’?

A

The concept that communication technologies have massively reduced the time it takes to trade and communicate globally, therefore even though the physical distances are unchanged, the time taken to cross them is significantly lower

71
Q

What is ‘trade liberalisation’?

A

The removal of trade barriers such as subsidies, tariffs and quotas

72
Q

What is ‘trade protectionism’?

A

The use of methods such as tariffs and quotas to attempt to boost a country’s exports or reduce its imports

73
Q

What is meant by the term ‘trading bloc’? What is an example of one?

A

When countries have grouped together to promote free trade between them. The EU is an example of a trading bloc

74
Q

What does WB stand for?

A

World Bank

75
Q

What is the role of the World Bank?

A

A global organisation which uses bank deposits placed by the world’s wealthiest countries to provide loans for development
in other countries

76
Q

What does WTO stand for?

A

World Trade Organisation

77
Q

What is the role of the World Trade Organisation?

A

A global organisation which looks at the rules for how countries trade with each other

Edexcel A Level Geography (23 decks)

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