LS1

Question 1

What is globalisation?

Answer 1

The process of interaction and integration among people, companies and governments worldwide into a single market

Question 2

What are the characteristics of globalisation?

Answer 2

Free trade or goods between countries
Free movement of capital and labour between countries
Availability of technology and intellectual property internationally
Less protectionism
Spread of culture
Integration of production chains
Foreign ownership

Question 3

What are TNCs

Answer 3

Companies that operate in at least 2 countries,

Cheap labour and materials and transport attracts TNCs

Question 4

What are the causes of globalisation?

Answer 4

Trade liberalisation
Rules on product standards
Containerisation: cheaper and more efficient
Improvements in communication
Transition from command to mixed economies
Overseas investment
Global brands
Foreign ownership
More specialisation due to reliance on trade

Question 5

What are the benefits of globalisation?

Answer 5

Greater customer choice
Prices falling because production is switched to cheaper locations (but can be more demands)
Greater competition
More specialisation increases output
Increased access to cheaper raw materials
Higher skilled workers and wider job market
Job creation

Question 6

Drawbacks of globalisation?

Answer 6

National industries are outcompeted
Unemployment for low skilled people
Increased incomes lead to increased demand
Economic dependency
Production moves to cheaper places so structural unemployment
Global supply chains can be unreliable

Question 7

What are negatives for TNC’s

Answer 7

They can exploit workers for cheap labour
Local firms have competition so may have to go out of business
Influence governments
Tax havens lead to less government revenue

Question 8

Consequences for the environment?

Answer 8

International transportation means more fossil fuel usage
Carbon emissions
Deforestation

Question 9

Consequences for developing countries?

Answer 9

Skilled workers migrate to developed countries

Better technology and investment

Question 10

Consequences for developed countries?

Answer 10

Structural unemployment (textiles moving to Bangladesh)
Increased imports
Better access to raw materials

Question 11

What is factor endowment?

Answer 11

The amount of land labour capital and enterprise that a country can possess and exploit