Theme 4: A Global Perspective

Question 1

What can globalisation be defined as ?

Answer 1

Growing interdependence of economies and the rapid rate of change it brings about; increasing integration of the world’s local, regional, and national economies into a single international market

Question 2

What are factors contributing to globalisation ?

Answer 2

• improvements in transport infrastructure and operations; quick, cheap, and reliable methods of splitting production internationally
• improvements in IT and communication
• trade liberalisation and reduced protectionism
• international financial markets
• TNCs

Question 3

What are the impacts of globalisation on consumers ?

Answer 3

• more choice
• lower prices, cost of production can be reduced
• could lead to prices rising due to higher demand and incomes
• loss of culture

Question 4

What are the impacts of globalisation on workers ?

Answer 4

• job losses, jobs transferred from the western world
• increased migration, lowers wages but can increase jobs
• decrease in wages for lower skilled workers, increase for higher skilled, inequality
• poor conditions in sweatshops

Question 5

What are the impacts of globalisation on producers ?

Answer 5

• can source from and sell in more countries, reduces risk
• can exploit comparative advantage and larger markets
• decrease production costs
• firms unable to internationally compete will lose out

Question 6

What are the impacts of globalisation on the government ?

Answer 6

• higher tax revenue from TNCs
• may lose out through tax avoidance
• TNCs can bribe and lobby governments, could lead to corruption

Question 7

What are the impacts of globalisation on the environment ?

Answer 7

• increased demand for raw materials, detrimental
• higher emissions
• world can share ideas and technology to tackle climate change

Question 8

What are the impacts of globalisation on economic growth ?

Answer 8

• investment within countries, injection can lead to a multiplier effect
• TNCs can bring improved management techniques and technology, can have knock on benefits to all industries
• increases output through comparative advantage
• TNCs can cause political instability
• comparative cost advantage changes over time, company may leave a country resulting in structural unemployment and reduced growth