TESTTT Flashcards
What is globalization?
Globalization is a process in which national economies have become increasingly integrated and interdependent. It has been happening over the last 40-50 years and has been driven by factors such as trade liberalization, growth of the World Trade Organization, technological advancements, and greater mobility of labor and capital.
What are the benefits of globalization?
The benefits of globalization include lower prices, increased international trade, greater consumer choice and quality, more efficient and innovative businesses, access to raw materials, greater employment, and greater economic growth and development in both developed and developing countries.
What are the cons of globalization?
The cons of globalization include potentially negative effects on certain industries or workers, wage stagnation for certain groups, increased inequality, loss of cultural identity, and increased dependence on other countries.
Pros - Increased International Trade
Free trade allows countries to specialize in the production of goods and services in which they have a comparative advantage, leading to increased efficiency and lower costs. Graphs that could illustrate this include a production possibility frontier (PPF) showing the increase in output resulting from specialization and trade, and a graph of average production costs for different goods and services before and after trade liberalization.
Pros - Lower Prices
Increased competition from international trade leads to lower prices for consumers. This is because businesses are able to access raw materials from different locations and reduce costs leading to lower prices for consumers. An A/D graph can be used to illustrate this in the graph, the supply curve will shift to the right (decreased costs), Demand curve will shift to the right (increased demands because of lower prices)
Pros - Promoting Economic Development in Developing countries
Promoting Economic Development in Developing Countries: Globalization provides opportunities for economic development in developing countries, through increased access to larger markets and the benefits of trade
Pros - Greater Employment
As the market size increases with globalization, firms are able to grow in size, leading to greater employment opportunities. You could use a labour graph for that.
What are the drivers of globalisation?
1). Increased rate of technological transfer (increased role of MNCs)<br></br>2). Improvements in transport and infrastructure and operations<br></br>3). Improved IT & communications and rapidly falling communication costs making it easier to find suppliers and customers to trade globally, e.g. internet<br></br>4). Reductions in protectionist measures enabling a freer movement of people, money and products. Trade agreements, such as the General Agreement on Tariffs & Trade (GATT) 1947-95 & World Trade Organisation (WTO) 1995 onwards<br></br>5). Increased influence of multinational companies that operate in a number of countries<br></br>6). Increased homogeneity in the safety standards of products<br></br>7). Increased international mobility of labour<br></br>8). Increased international flows of capital, including de-regulation of global financial markets and removal of capital controls in many countries<br></br>9). Emergence of new economies, such as China<br></br>10). Economies of scale<br></br>11). Falling travel and transport costs (e.g. air, sea and freight travel)<br></br>12). Reduced political barriers, such as the opening up of former communist regimes and switch to more market-oriented policies<br></br>13). Competition between tax jurisdictions, as countries adjust their tax systems to attract foreign direct investment.
What is the first driver of globalisation?
The first driver of globalisation is the increased rate of technological transfer. This is largely due to the increased role of multinational corporations (MNCs) that are transferring technology across borders to increase their competitiveness.
What is the second driver of globalisation?
The second driver of globalisation is the improvements in transport and infrastructure and operations. This includes advances in transportation technologies, such as containerisation, which have made it easier and more cost-effective to transport goods and people around the world. Additionally, improvements in infrastructure and operations have increased the efficiency and reliability of global trade and transportation.
What is the third driver of globalisation?
The third driver of globalisation is the improved information technology and communications and rapidly falling communication costs. This includes the widespread availability of the internet, which has made it easier to find suppliers and customers to trade with globally. The reduction in communication costs has also facilitated cross-border business activities, including communication and collaboration among multinational teams.
What is the fourth driver of globalisation?
The fourth driver of globalisation is the reductions in protectionist measures, such as trade barriers, tariffs, and quotas. This has been facilitated by international trade agreements, such as the General Agreement on Tariffs & Trade (GATT) 1947-95 and the World Trade Organisation (WTO) from 1995 onwards, which have encouraged freer movement of people, money, and products across borders. Additionally, the increase in regional free trade areas and customs unions has further encouraged global trade.
What is the fifth driver of globalisation?
The fifth driver of globalisation is the increased influence of multinational companies that operate in multiple countries. These companies have significant power and influence over global markets, as they can leverage their size and resources to penetrate new markets, negotiate favorable trade agreements, and transfer technology and best practices across borders.
What is the sixth driver of globalisation?
The sixth driver of globalisation is the increased homogeneity in the safety standards of products. As global trade has increased, so too has the demand for consistent and harmonized product safety standards. This has made it easier for multinational corporations to sell their products in multiple countries and for consumers to purchase products from around the world with confidence.
What is the seventh driver of globalisation?
The seventh driver of globalisation is the increased international mobility of labour. This includes the migration of workers from one country to another, either for work or to seek better living standards. Additionally, advances in communication and transportation technologies have made it easier for workers to communicate and collaborate with their colleagues in different countries.
