Globalization and Economic Activity

Question 1

Globalization

Answer 1

A complex combination of economic, political and cultural changes that have long been evident but that have accelerated markedly since about 1980, bringing about a seemingly ever-increasing interconnectedness of people and places.

Question 2

Commodity chains

Answer 2

a process used by firms to gather resources, transform then into goods or commodities and finally distribute them to consumers. A global assembly line.

Question 3

key dimensions of globalization

Answer 3

-process throguh which the world is becoming a single world society- global village
-Production of goods (and services) around the world, using natural and human resources ie commodity chains
-availability of good (and services) everywhere - a global shopping mall (amazon)

Question 4

where has interconnected come from in the global economy

Answer 4

-reducing the friction of distance
-breaking down barriers
-extending the scope of business
* each inter-related with one another - connected to accessibility and connectivity

Question 5

reducing the friction of distance

Answer 5

emergence of shipping containers
-emergence of the internet
made goods and services from afar more assessable (quick and less expensive0

Question 6

containerization

Answer 6

international shipping practice of storing of freight within standard sized container units, then transporting it using a variety of intermodal technologies- ie ships, trains, trucks
lowers cargo handing costs
90% of non build goods
>20 million containers; 200 million trips per year
>10 000 containers lost at sea

Question 7

supranational organizations

Answer 7

a multinational grouping of independent states, where power is delegated to an authority by member governments
-elimination of barrier to trade and foreign investment to facilitate flow of goods between countries. Eg: NAFTA (north America), ASEAN (southeast), the European union, Mercosur (south America)–> free trade zones

Question 8

Transnational corporations (TNC)

Answer 8

a large business organization (firm) that operates in two or more counties; sometimes referred to as a multinational corporation; in many cases the head office is in a more developed country and its manufacturing/processing facilities are in less developed countries ie Nike, Apple, Toyota

Question 9

The size and influence of Trans national corporations has become possible via

Answer 9

-differential wedges
-different environmental regulations
-low cost of global transportation via containerization
-reduction of trade barriers

Question 10

Globalization in the service sector

Answer 10

-trans national corporations; call centers in India, business processing outsourcing, ect

Question 11

Globalization perspective: hyperglobalist

Answer 11

view that globalization is an intensifying and largely beneficial process where the world’s people and counties are linked together by technology and boarder free markets
ie. Thomas Friedman; the world is flat

Question 12

Globalization perspective: Skeptic

Answer 12

globalization is retreating and is generally a bad thing (for most people); globalization has contributed to the recent rise of increasingly nationalistic (protectionist) policies ie Brexit, trump
ie John Ralston Saul- The collapse of globalism

Question 13

Globalization perspective: transformationalist

Answer 13

claims of globalized world are exaggerated and that the world is globalizing into a series of interconnected regions. Falls between hyperglobalist and skeptic views.
IE Pankaj Ghemawat- world 3.0

Question 14

KOF index of globalization:

Answer 14

utilizing a representative suite of indicators of global interconnectedness among 3 dimensions; economic globalization, social globalization, political globalization

Question 15

DHL global connectedness index:

Answer 15

primarily economic criteria, globalization and levels of development

Question 16

Increasing world trade facilitated by

Answer 16

colonialism, technology and political changes

Question 17

Foreign Direct investment (FDI)

Answer 17

direct investment by a government or transnational/multinational corporation in another country, often in the form of manufacturing or processing plant.
measured by inflows (investment to country) and outflows (country to investor)
-typical forms of investment: manufacturing, processing plants, real estate, research and development, technology.
Top FDI inflow: USA, next: china

Question 18

tariffs

Answer 18

a tax or customs duty imposed on imports rom other countries

Question 19

Import substitutions

Answer 19

an economic strategy of domestically manufacturing goods that were previously imported throguh the aid of protective tariffs (taxation of imported goods); often used as a stimulus for industrialization

Question 20

free trade

Answer 20

an economic system without (or reduced ) tariffs and trade barriers

Question 21

Tourism

Answer 21

individual investment in time and money and travel

Question 22

cultural imperialism

Answer 22

imposition of cultural values and practices by a politically or economically dominant foreign cultural on 1 or more native cultures

Question 23

cultural homogeneity

Answer 23

caused by increased interconnectedness
-loss of national and local identity- less conflict but loss of biodiversity

Question 24

Negatives of globalization

Answer 24

globalization favours MDW over LDW
-Favours economies that are industrial vs export oriented
-Favours resource extraction and consumption over sustainability

Question 25

positives of globalization

Answer 25

-is best hope for producing a better way of life for everyone; decreased poverty, spread democracy, ect -seeing the shifting landscape from 2 groups (MDW and LDW) to 3 (or more) with recognition of emerging markets and even a broadening of what constitutes more developed.

Question 26

primary activities

Answer 26

economic activities involving the identification and extraction of the world's natural resources, such as mining, fishing, forestry and agriculture -identification and extraction of raw materials

Question 27

Secondary activities

Answer 27

economic activities involving the processing, transforming, fabricating, and assembling raw materials (or secondary products) into finished goods; sometimes referred to as industrial activities; generally include activities such as manufacturing, food processing and construction. -transforming of raw material into finished products -the manufacturing or industrial sector

Question 28

tertiary activities

Answer 28

economic activities involving the sale or exchange of goods and services; mostly referred to as service activities; generally include wholesale and retail trade, hospitality and food services, insurance and baking, law, real estate and various government services ie. food services (restaurant), retail, hospitability (hotels), hair salons, barbers, spas, entertainment -consumer (personal) vs business services -sometimes delineated into tertiary, quaternary and quinary

Question 29

quaternary (business)

Answer 29

transportation and communication, advertising, real estate, insurance, law, architecture, banking and finance

Question 30

quinary (government)

Answer 30

education, health care, government services, research and development, policing, fire, military

Question 31

sectors by level of development

Answer 31

More developed economies: service sector (tertiary) Canada and UA: 85% of employment is the service sector Less developed economies: mostly primary and secondary sectors

Question 32

Primary economic activities in North America: Mining

Answer 32

northern Canada- Canadian shield (nickel, iron, ore), western north America- rocky mountains (copper, gold, silver, rare earth elements), eastern north America- Appalachian (coal), southern US- gulf of Mexico (oil), great plans/prairies (Athabasca tar sands-oil, natural gas fracking)

Question 33

Primary economic activities in North America: fisheries

Answer 33

many areas depleted -east coat: Massachusetts, main, nova scotia, newfoundland pacific north west- Alaska, BC Gulf of Mexico

Question 34

Primary economic activities in North America: forestry

Answer 34

-eastern Canada and north eastern USA- hard woods -Pacific northwest- softwood Northern Ontario and Quebec -US southeast- pulp and paper

Question 35

Primary economic activities in North America: Agriculture

Answer 35

1881: 48% of Canadian labour force- even more decline since the mid 19thC-industrialization today only a small proportion of employment and GDP -still have some geographies of articulates facilitated by local environment, land suitability, agricultural specialization (Florida and California oranges, grain in great lakes basin, livestock in Alberta)

Question 36

agribusinesses

Answer 36

a highly integrated form of transnational corporation in the agricultural or food production sector: typically highly capitalized, operating on a large scale(often across various regions), corporately owned, and vertically integrated (encompassing the growing, processing and marketing of food).- ie McCane's, Tysons

Question 37

Commercial agriculture

Answer 37

an agricultural system in which production is primarily for sale for profit; typically large scale, utilizing large amounts of land and the latest technology, and highly mechanized

Question 38

food processing system includes

Answer 38

land (& climate) a series of inputs (labour, fertilizer, machinery) outputs (products, commodities consumers (buy and eat)

Question 39

Subsistence (traditional) agriculture

Answer 39

an agricultural system in which production is not primarily for sale, but is consumed by the producer typical forms: shifting cultivation- use land then abandon pastoralism: animals graze lands- eventually eat livestock Typically found in the LDW

Question 40

Commercial (modern) agriculture

Answer 40

an agriculture system in which production is primarily for sale for profit ie coffee, cocoa, bananas typical forms: family farms, agribusinesses, industrial farms, plantations typically found in the MDW

Question 41

why are agricultural activities located where they are

Answer 41

physical factors: soil, fertility, climate, topography (relief) cultural factors: religion, ethnicity and cultural tastes political factors: subsidies, marketing boards, quotas economic factors: competition for land result: agricultural use patterns-- Von Thunen

Question 42

manufacturing (value added) top countries MDW and LDW

Question 43

industrial revolution

Answer 43

the process that converted a fundamentally rural society to an industrial society, beginning in England around 1750; primarily a technological revolution associated with the harnessing of new energy sources and the use of machinery to replace manual labour; associated with societal, demographic, political, economic and urban change.

Question 44

industrialization is closely aligned with

Answer 44

economic development- become more developed as industrialize urbanization->fuel by rural--> urban migration demographic change- declining birth and death rates cultural and technological change

Question 45

pre-industrial production

Answer 45

industrial activity was everywhere: localized and rudimentary skilled craftsmen/artisan- small scale and limited technology every village, town and city had industrial enterprises eg. blacksmith, millers, weavers, potters

Question 46

the industrial revolution

Answer 46

18th and 19th C revolution in the way goods where produced/manufactured -started with the development of the steam engine by James Watt new sources of energy (coal)- mining discoveries machines replaced skilled hands of labourers the volume of goods produced increased

Question 47

traditional major industrial area

Answer 47

Western Europe: 1st: Northern England- the midlands- birth place of industrial revolution (where steam engine) also had lots of coal (C1760), then spread to the Rhine and Ruhr Valleys in the Germany and the Netherlands- diffusion to this location in the early 19th C Eastern North America: Appalachians (north east USA0- diffusion in the early 19th C *** coal*** key sites had supply of coal energy -these regions dominated throguh the 20th C- still have significant manufacturing power (~35-40% of manufacturing value added)

Question 48

Essential components of the industrial revolution

Answer 48

-Large scale factory production- shift away from little artisans -Agglomerating of industries near source of energy or areas with transportation advantages -highly capitalized ($$$) mechanization- machines, bring coal -Rapid and extensive rural-urban migration- people still need to maintain the machines

Question 49

traditional industrial areas: Europe

Answer 49

-Brittan (midlands- still industrial from historical inertia), Rhine-Ruhr (now: automotive, trains, petrochemical), Southern France/ northern Italy (planes). Manufacturing output: 19thC: ~8p%; today: ~17% world MVA Market of manufactured goods: ports- rauderdam, Liverpool- imports come in (consumer goods)

Question 50

Traditional industrial areas: north America

Answer 50

~18% MVA of world -manufacturing belt

Question 51

Manufacturing belt

Answer 51

North east UA- Steel, automotive, petrochemical, aerospace, food, telecommunications, consumer goods --> shifted away from manufacturing belt- shift to south and west due to lower wages and antiunion legislation- mexico Now called rust belt

Question 52

Newly industrializing areas

Answer 52

Japan East Asia (south Korea, Taiwan, China) Southeast Asia (Indonesia, Philippines, Vietnam) South Asia (India, Pakistan) Latin America (brazil) Africa (Nigeria, Lesotho--> no significant evidence of industrialization--> growing evidence that it's on its way- new china?)

Question 53

Off shoring

Answer 53

the outsourcing of work to another country; usually involves companies in more developed economies shifting work to less developed economies

Question 54

Time line of eastern and southeastern Asian industrialization

Answer 54

1950s: Japan 1970s: south Korea, Taiwan, Hong Kong, Singapore--> the four tigers 1980s: china 1990s (southeastern Asia)- Thailand, Philippines, Malaysia, Indonesia

Question 55

China industrialization

Answer 55

-1980s via market oriented capitalism -low labour cost -initial specialization in low quality consumer goods the most significant manufacturing economy

Question 56

japan industrialization

Answer 56

late 19th C and post WWII success despite limited raw materials low labour costs and high productivity -high quality consumer goods - cars, computers, ect

Question 57

Industrialization in NIC linked to

Answer 57

-low labour costs -goods shipped to global markets via containers

Question 58

Export processing zones

Answer 58

industrial areas with special incentives set up to attract foreign investors in which imported materials undergo some degree of processing before re-exporting ~130 countries; >50 million workers -exempt from import/export duties -subsidized infrastructure -weak labour and environmental regulations ie Foxconn, maquiladora

Question 59

deindustrialization

Answer 59

loss of manufacturing activity and related employment; generally used in reference to traditional manufacturing regions in the MDW. Areas where industrial production is of declining important- manufacturing belt now called the rust belt -transition from industrial to post-industrial: uneven and difficult- job losses, underemployment

Question 60

Reindustrialization

Answer 60

The development of new industrial activity in a region that has earlier experience substantial loss of traditional industrial activity small, niche-market products- ie craft brewery High tech and research oriented industries ie McMaster innovation park

Question 61

what does industrialization mean for newly industrializing countries

Answer 61

-economic transformation- primary-->secondary economic activities -urbanization Demography: fertility and mortality decline, life expectancy increases -prosperity (but unequal): higher wages (for some) and thus domestic market for goods (work in factory- buy more stuff)

Question 62

Singles day

Answer 62

November 11--> emerged first in china- is the biggest shopping day in the world- domestic consumption demonstrating china's development

Question 63

Primary/pre-industrial/subsistence society

Answer 63

produce (grow), prepare and consume food within the home

Question 64

secondary/industrial society

Answer 64

specialised farming, food retail (grocery stores) and increasingly manufactured, processed meals like frozen pizza, tins of soup, frozen vegs--> but still consumed at home

Question 65

Tertiary/post-industrial/service society

Answer 65

increasingly people consume food outside the home at restaurants and fast food (drive thu) retailers

Question 66

tertiary sector in Canada and the world

Question 67

hierarchy of places

Answer 67

the highest order places provide the greatest range of goods and services. global cities are at the top

Question 68

Market area analysis

Answer 68

what is the market and where should we locate it - use central place theory

Question 69

outsourcing of business services

Answer 69

paying an outside firm to handle functions previously handled inside the company or government with the intent to save money or improve quality -under globalization many business services can be provided far away from customers and business back office: clerical, accounting, human resources Font office: -also see business outsources (PO)- India, Malaysia, Philippines (#1)

Question 70

tourism consumption vs production

Answer 70

consumption: middle and upper class countries production: most working in the tourism industry are low wage workers