Globalisation key terms

Question 1

transnational corporations

Answer 1

Businesses whose operations are spread across the world, operating in many nations as both makers and sellers of goods and services. Many of the largest are recognisable as global brands that bring cultural change in the areas they are consumed in.

Question 2

gross domestic product

Answer 2

A measure of the financial value of goods and services produced within that country including foreign firms located there

Question 3

emerging economies

Answer 3

Countries that have begun to experience high rates of economic growth, usually due to the rapid factory expansion and industrialisation. There are numerous sub groups to emerging economics (NICS, RICS, BRICS)

Question 4

remittances

Answer 4

Money that migrants send home to their families via formal and informal channels

Question 5

interdepency

Answer 5

If two places become over reliant on financial and/or political connections with one another, then they have become interdependent.

Question 6

spatial division of labour

Answer 6

The common practice among TNCs of moving low skilled work abroad (or offshore) to places where labour costs are low. This is also called the new international division of labour

Question 7

intermodal containers

Answer 7

Large capacity storage containers which can be loaded onto ships or trains without the freight being taken out.

Question 8

shrinking world

Answer 8

Thanks to technology, distant places start to feel closer and take less time to reach.

Question 9

foreign direct investment (FDI)

Answer 9

A financial injection made by a TNC into a nations economy, either to build new infrastructure, to build new facilities or to acquire or merge with an existing firm already located there.

Question 10

trickle-down

Answer 10

The positive impacts on peripheral regions (and poorer people), caused by the creation of wealth in core regions.

Question 11

sovereign wealth funds

Answer 11

Government owned investment funds and banks typically associated with China and countries that have large revenues from oil such as Qatar

Question 12

trade blocs

Answer 12

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

Question 13

tariffs

Answer 13

The taxes that are paid when importing or exporting goods and services between countries

Question 14

special economic zone

Answer 14

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

Question 15

offshoring

Answer 15

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

Question 16

outsourcing

Answer 16

TNCs contract another company to produce the goods and services they need rather than do it themselves. This can result in the growth of complex supply chains.

Question 17

global production networks

Answer 17

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

Question 18

least developed countries

Answer 18

The worlds very poorest low-income nations whose populations have little experience of globalisation. A number of these nations are described as ‘failed states’ by politicians.

Question 19

subsidies

Answer 19

Grants given by governments to increase the profitability of key industries

Question 20

just in time

Answer 20

The means by which the time gap between production and delivery to the customer is sharply reduced – cutting warehousing and storage costs.