human globalisation Flashcards
what is globalisation
the process by which people, their cultures, money, goods and information can be transferred between countries with few or no barriers
what are the historical connections (3)
Trade
colonialism
co-operation
what are the types of globalisation (4)
political
economical
cultural
social
what are the effects of globalisation (3)
it increases global awareness
increasing global responsibility
increasing global village
what is containerisation
is the use of countries using containers of the same size for trade and less chance of theft
what is the effects of improving transport technology (2)
enables the physical movement of goods and people to travel further and more cheaply
container ships have become so large it is now cheap to ship goods around the globe
what’s a player
anyone with a vested interest or involvement with a particular process or event
what is IMF and what do they do
- International monetary fund
- they issue short term loans and recommend policies for sustainable growth
what do the world bank do
reduce poverty by lending money to governments of its poorer members to improve their economies and to improve the standard of living of their people
what is WTO and what do they do
- world trade organisation
- improve the welfare of people around the world by ensuring that trade flows smoothly
what is a trading bloc
countries which group together to improve their economic interests and trading patterns (by reducing barriers)
advantages of trading blocs (2)
- producers focus on making what they are good at
- smaller nations have opportunity to merge to form TNCs
disadvantages of trade blocs (2)
- loss of sovereignty
- interdependence: disruption of trade within a trading bloc. become dependent on each other
what does ASEAN stand for and what’s in it
- association of south-east asian nations
- 10 countries
- seventh largest economy in the world
What is the EU and its policies/contents
- European Union
- 27 countries
- is a free trade zone
- free migration across borders
What is FDI
Foreign direct investment- financial injection made by a TNC into a nation’s economy, either to build new facilities (factories or shops) or to acquire, or merge with, an existing firm already based there.
what are the types of FDI
- foreign mergers
- transfer pricing
- offshoring
- foreign acquisitions
what is foreign mergers
two firms in different countries join forces to create a single entity
what is transfer pricing
the setting of a price for the transfer of products or services between controlled (or related) sections of a TNC
what is offshoring
the practice of basing some of a company’s processes or services overseas, so as to take advantage of lower costs
what is foreign acquisitions
A TNC launches a takeover of a company in another country
how do the government promote FDI
- free-market liberalisation
- privatisation
- encourage business start-ups
what’s free-market liberalisation
restrictions being lifted on the way companies and banks operate
what is privatisation
transferring ownership of a business, agency, service or property from the public (government- controlled) sector to the private sector
what’s encouraging business start-ups
methods range from lower business taxes to changes in the law allowing both local and foreign-owned businesses to make profit
how do you measure globalisation
- A.T Kearney Index- look at: political engagement, personal contact, economic integration, technological connectivity
- the KOF Index- works out a score for each country based on interaction in categories: economic globalisaton, social globalisation, polictical globalisation range is 1-100
what is a TNC and how does it grow
- trans national corporation- is a company that has operations in more than one country
- grow by buying up foreign firms in mergers and acquisitions
how do TNCs link groups of countries, and ferge connections between people in different countries
- through the production of goods
- by shaping common patterns of consumption
How do TNCs influence globalisation
- by using global production networks
- by creating new places to do business (new markets)
- by making global products more local (glocalisation)
why do some countries benefit more from FDI and TNCs
- not all places are suitable sites of productikion for goods
- not all places have enough market potential to attract large retailers
- TNCs can build instead business partnerships with existing companies in other countries
- biggest brands outsourcing
what is glocalisation and what’s it used to address
- adapting the goods or services or a business to increase consumer appeal in diferent local markets
- religious or cultural objections, or regulatory or design restrictions
examples of economic liberalisation
- offshoring
- outsourcing
what is offshoring
TNC’s move parts of the production process (factories or offices) to other countries to reduce labour or other costs (eg. import tariffs)
what is outsourcing
when a TNC contracts another company to produce the goods and services they need rather than do it themselves. this can create a very complec supply chain.
what is the global economic shift
significant global economic shift in the centre of gravity from the ‘West’ to Asia (economic core) from the mid 20th century