Globalization Flashcards
The 10 percent presumption
Only about 10 percent of activity is conducted globally; the remaining 90 percent is domestic
,,Flat world”
Theory by Thomas Friedman, a world with free access to markets, few barriers to competition, and consistent enforcement of regulations. Individuals are able to compete head-to-head with large global companies, and those in poor countries with limited infrastructure are able to compete with people in rich, well-developed countries
,,Round world”
the world is not as connected as we might think and the shift toward globalization may not be a good thing. Frankfurt, Hong Kong, London, New York, and Singapore—represent the peak of global integration. Most of the world’s other cities are much more connected locally than they are to other domestic cities
Is access to foreign markets enough to enter foreign markets?
Efficient distribution, locally desirable goods and services, and effective marketing are required in each foreign market.
Two Sides of the Globalization Coin
The introduction of technology and investment capital allows a country to create more food and more wealth as a whole, but it creates greater inequalities between the very few wealthy farmers and the rest, who cannot afford to compete.
re-globalization
Theory for future trade and commerce of world economy with newer and alternate centers of manufacturing, trading, and services, reducing dominance of one country. (China) Countries like India and other developing countries can gain from re-globalization
What did the BRIC countries do?
Brazil: to calm down inflation, the brazillian currency was tied to the US dollar, that meant that inflatyion rates in Brazil would not go above inflation rates in USA. This stabilized the Brazillian economy.
Russia: Had tremendous growth from e-commerence both internally and externally, quickly after the fall off the Berlin wall. This meant East and West Germany could trade goods.
India: Was on the brink of bankruptcy untill they opened the economy to foreign trading
China: International backlash from the Tiannen Square protest caused the Chinese communist party to open a socialist-market economy. Making them one of the most powerful market-based economies
Wage Arbitrage
The practice of capitalizing on differences in wages between countries, benefiting both developing nations by creating jobs and developed nations by reducing production costs.
Trade Institutions:
Organizations such as the WTO, IMF, and World Bank, which govern global trade and support free trade policies and economic development.
Trade Wars
Economic conflicts where countries impose tariffs or other restrictions on each other, disrupting trade relations.
Mercantilism
Mercantilism: An economic system where nations accumulate wealth through trade surplus and control of resources, often at the expense of other countries.
Spillover Effects of Globalization:
Spillover Effects of Globalization: The uneven distribution of benefits from globalization, where some regions or populations may be left behind or adversely affected.
Foreign investment:
Foreign Investment: The injection of capital into a country by individuals, companies, or governments from another country, often driving industrial development and exports.
Political Globalization:
Political Globalization: The process by which political decisions, governance models, and institutions across nations become interconnected and influenced by global frameworks and institutions.
Nation-State:
Nation-State: A sovereign political entity characterized by defined borders and centralized governance. Under globalization, the concept of nation-state is perceived by some to be weakening as international bodies increasingly shape policies.
Policy Evolution and Implementation:
Policy Evolution and Implementation: The process through which international bodies and agreements shape national policies, affecting areas like trade, labor, and development.
Interstate Alliances:
Interstate Alliances: Partnerships and collaborations between countries formed for political, economic, or security reasons, often influenced by globalization.
