lesson 3: globalisation

Question 1

what is globalisation?

Answer 1

the breaking down of barriers to which increases interconnectivity and interconnectedness

Question 2

what are the five causes of globalisation?

Answer 2

improved communication

reduced transport costs

trade liberalisation

increased competition

the rise in skill levels

Question 3

what is the impact of containerisation, satellite communication and now the internet has resulted in what?

Answer 3

the death of distance

Question 4

what is the good side and bad side of globalisation?

Answer 4

good: higher living standards, increased competition leading to falling prices and higher quality, greater global cooperation

bad: inequality, negative externalities, developed nations take advantage of developing nations

Question 5

what has deindustrialisation done to the west?

Answer 5

the well paid manufacturing jobs in the countries like the UK have been replaced by low paid service sector jobs called McJobs

Question 6

what has jobs leaving to the low cost NIEs caused?

Answer 6

international structural unemployment

Question 7

what is dependency theory?

Answer 7

the idea that the developed countries exploit the developing nations for their natural resources and that the terms of trade are to favour them which raises the living standards of the developed countries at the expense of the poorer ones

Question 8

what is the WTO?

Answer 8

international organisation that seeks to promote free trade by removing trade barriers

Question 9

arguments for globalisation as an opportunity

Answer 9

1) countries can specialise where they have a comparative advantage —> rising output —> more goods and services to enjoy —> higher living standards

2) increased competition —> drive efficiency and innovation —> lower costs —> lower prices —> more choice

3) greater access to markets —> firms that are successful can expand and enjoy EOS —> get down costs and maximise profits

Question 10

arguments for globalisation as a threat

Answer 10

1) overspecialisation leads to vulnerability to supply shocks

2) cost of the environment

3) access to new markets leads to firms failing —> structural unemployment

Question 11

when did china join the WTO?

Answer 11

2001

Question 12

how many people were lifted out of poverty from china from 1981 to 2012?

Answer 12

500 million

Question 13

chain of reasoning of how tariffs work

Answer 13

increase price of imports
decrease demand for imports
increase demand for domestically produced replacements
increase jobs