Globalization Flashcards
Elements constituting globalization
- Perceived distance shrinking
- Global integrated economic system
What is regionalization?
Progressive integration of trade among nations at the regional level
Globalization advantages and disadvantages
A
- increased trade
- increased competition –> lower prices
- economies of scale
- increased capital and labor mobility
D
- monopoly from multinationals
- structural unemployment from shifting sectors
- easier tax avoidance
Foreign Exchange Market
Determines exchange rate of currencies (in 2022 it saw a daily average of $8.9 trillion worth of transactions)
What are the two sides of globalization?
- Markets
- Production
Which adaptations to the offer are most common?
- Product features
- Packaging
- Brand and adv
- Marketing
- BM
Which global institutions help regulating the global marketplace?
- WTO
- IMF
- UN
- G20
Two main factors underlying globalization
- Decline in trade and investment barriers
- Technological change (especially communication, information processing and transportation)
Which steps characterize the process of shift from planned/mixed economies to merket-based economies?
- Deregulation
- Privatization
- Global legal system to safeguard property rights
Deregulation
- Removes legal restrictions and price control
- Removes or relaxes limits on FDI
Privatization
Sale of state owned assets to privates from the 80s (~$185 billion) to the 90s. Britain was the one initiating this process with PM Margaret Thatcher
Which consequences does privatization have?
Private management undoubtedly leads to costs cutting and greater attention to customer satisfaction
+
Reduce operating costs of public sector leads to a lower fiscal burden
What is the level of the DHL world connectedness?
25%
