Macro A2 - Globalisation Flashcards
What is globalisation
Globalisation is a process by which economies and cultures have been drawn deeper together and have become more inter-connected through global networks of trade, capital flows, and the rapid spread of technology and global media.
Characteristics of globalisation
- it initiates growth and interconnectivity of various sector across nations.
- it facilitates global business expansion, cross-culture diversification & lower taxes/tariffs on international business operations.
-Migration of workforce and international investments create job opportunities, enhanced goods and services as well economic development.
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Factors contributing to globalisation in the last 50 years
There has been a large increase in foreign direct investment by firms over the past 50 years. This has led to an increase in the number of businesses that are owned by an entity in another country. For example, brands such as Apple and Samsung make up the majority of phone sales in the UK, despite Apple having its headquarters in America and Samsung having its headquarters in South Korea. This is an example of the increasing influence global companies are having in UK markets.
impacts of globalisation and global companies on individual countries
Positive impacts include:
Increased economic growth and job creation, especially in the export sector.
Access to a wider range of goods and services, leading to increased consumer choice.
Increased foreign investment and transfer of technology, leading to improved infrastructure and overall development.
Improved standards of living and access to new markets for local businesses.
Negative impacts include:
Job losses in certain sectors, such as manufacturing, as a result of competition from cheaper imports.
Increased income inequality as a result of wage stagnation and job losses.
Environmental degradation, as companies may prioritize profits over sustainability.
Loss of cultural identity and traditional practices, as local cultures are replaced by global homogenization.
impacts of globalisation and global companies on governments
On the positive side, globalization has facilitated the growth of economies, increased trade, and brought more investment and job opportunities to many countries. This has improved the standard of living for many people and allowed governments to collect more taxes.
On the negative side, globalization has created new challenges for governments. For example, global companies can easily move their operations to countries with lower tax rates or looser regulations, reducing the tax base and government revenue in their home countries. This can also result in job losses and reduced economic growth, which can put pressure on governments to reduce spending on social services such as healthcare and education.
impacts of globalisation and global companies on producers
Globalization has created new markets for producers and increased access to new customers and suppliers. This has led to increased competition and efficiency, which can result in lower costs, higher quality products, and increased innovation. Global companies can also bring capital, technology, and expertise to local producers, helping them to improve their operations and compete more effectively in the global marketplace.
Globalization has also led to greater competition and decreased market power for many producers, especially those in developing countries. Global companies can take advantage of lower labour costs and looser regulations in these countries, reducing the prices they pay for raw materials and driving down wages for local workers. This can result in reduced profits and income for local producers, who may struggle to compete with larger, more efficient global companies.
impacts of globalisation and global companies on consumers
Globalization has made a wide range of goods and services available to consumers at lower prices. Consumers can now access products and services from around the world, increasing their choices and making it easier to find the best products at the best prices. Global companies also bring new technologies and innovations to consumers, improving the quality and availability of products and services.
Globalization has also led to concerns about the quality and safety of imported products. Some global companies have been criticized for exploiting workers, engaging in environmental degradation, and cutting corners on product safety in order to reduce costs and maximize profits.
impacts of globalisation and global companies on workers
Globalization has created new job opportunities in many countries, as global companies set up operations and expand into new markets. This can result in increased wages and improved working conditions for workers in these countries.
Globalization has also led to the decline of local industries and the loss of jobs in some communities. Global companies can take advantage of lower labor costs and looser regulations in developing countries, reducing the prices they pay for labor and driving down wages for local workers.
impacts of globalisation and global companies on the environment
Globalization has led to increased environmental degradation in many countries, as global companies take advantage of looser regulations in developing countries to cut corners on environmental protection. This can result in increased air and water pollution
