Topic 3 - EQ1 Flashcards
What is globalisation?
Globalisation is the increasing integration of economies around the world, particularly through the movement of goods, services, and capital across borders. There are also broader cultural, political and environmental dimensions of globalisation.
How was global connection achieved in the past?
-Trade: especially after 1942 when Columbus reached the Americas and the traditional world economy began to take shape
-Colonialism - by the end of the 19 century, the British empire directly controlled 1/4 of the world and its population
-Cooperation: Even since the end of WW1 in 1918, international organisations similar to todays UN have existed.
How have we become more globalised economically?
-The growth of TNCs accelerates cross-border exchanges of raw materials, components and finished manufactured goods, shares, portfolio investment and purchasing.
-Information and communication technology supports the growth of complex spatial divisions of labour for firms and a more international economy
-Online purchasing (e.g Amazon)
How have we become more globalised politically?
-The growth of trading blocs (e.g the EU and NAFTA) which allows TNCs to merge and make acquisitions of firms in neighbouring countries, while reduced trade restrictions and tariffs also allow markets to grow.
-Global concerns such as free trade, credit crunch and the global response to natural disasters (e,g 2011 Japanese Tsunami)
-The World Bank, IMF and WTO work together to harmonise national economies.
How have we become more globalised socially?
-International immigration has created extensive family networks that cross national borders.
-Global improvements in education and health can be seen over time, with rising world life expectancy and literacy levels, although the changes are by no means uniform or universal.
-Social interconnectivity has growth over time thanks to the spread of ‘universal’ connections such as mobile phones, the internet and e-mail.
How have we become more globalised culturally?
-‘Successful’ western cultural traits come to dominate in some territories. Can be known as ‘Americanisation’ or ‘McDonaldisation’.
-Glocalisation and hybridation are a more complex outcome that takes place as old local culture merge and meld with globalising influences.
-The circulisation of ideas and information has accelerated thanks to 24hr reporting; people are also able to keep in touch via social media.
How has modern (post 1940) globalisation differed from the global economy which preceded it?
-Connections have become much more lengthened, with products sourced from further away than even before.
-The connections have also become deeper, the sense of being connected to other people and places now penetrates more deeply into every aspect of life. It is almost impossible not to be connected to other people and places purely through what we consume.
-Speed of connection is now faster - people are able to talk to one another in real time even if they aren’t physically together. Alternatively, travel can be done very quickly due to jet aircraft’s.
Is the new sense of global connectivity felt by everyone?
No, some nations and regions (e,g The Sahel) experience a much more ‘shallow’ form of integration. Furthermore, great disparities can be felt within a country’s citizens about how ‘global’ they feel. People in an urban location are much more likely to feel global than those rurally, e.g in tribes in a rainforest.
What are some of the downsides to globalisation?
In a world where people have greater freedom to migrate across political borders like the EU nations does not satisfy everyone’s tastes. Equally, there are fears that TNCs are responsible for a growing trend towards cultural homogeneity (uniformity) on a global scale.
How are capital and commodities of network flows between places?
-Capital flows: At a global scale, major capital (money) flows are routed daily through the worlds stock markets. A range of businesses, including investment banks and pensions funds, buy and sell money in different currencies to make profits. In 2013, these were worth US$5trillion each day.
-Commodities: Valuable raw materials such as fossil fuels, food and minerals have always been traded between nations. Flows of manufactured goods have been multiplied in size in recent years, fuelled by low production costs in China and even lower-waged economies such as Bangladesh and Vietnam. In 2015, global GDP fell just short of US$80 trillion in value. Of this, around 1/3 was generated by trade flows in agricultural and industrial commodities.
How is information a network flow between places?
The internet allows real-time communication between distant places, allowing goods and services to be bought at the click of a button. Social networks have also ballooned in size and influence, with Facebook gaining 1.5billion users by 2015. On Demand TV has also increased usage further, and information is stored on ‘server farms’ such as the Microsoft Data Centre in Washington State.
How are tourists a network flow between places?
Many of the world’s air passengers are holiday makers. Budget airlines have brought a ‘pleasure periphery’ of distant places within easy reach for the moneyed tourists of high-income nations. Increasingly, people from emerging economies travel abroad too, using budget airlines such as AirAsia. China is now the biggest spender on international travel, with 120 million outbound trips made in 2014.
How are migrants a network flow between places?
Of all global flows, the permanent movement of people still faces the greatest number of obstacles due to border controls and immigration laws. As a result, most governments have a ‘pick and mix’ attitude towards global flow. They embrace trade flows but attempt to resist migrant flows unless there is a special need. Despite the restrictions, record flows of people are now recorded every year. The combined number of economic migrants and refugees worldwide reached almost 1/4 of a billion in 2013. Also in 2013, around US$500 billion of remittances were sent home by migrants.
What is GDP?
A measure of the financial value of goods and services produced within a territory. It is often divided by population size to produce a per capita figure for the purpose of making comparisons.
What are emerging economies?
These are countries that have begun to experience high rates of economic growth, usually due to rapid factory expansion and industrialisation. There are numerous sub-groups of emerging economies, including Brazil, Russia, India, China and South Africa (the BRICS group). They sometimes get called newly industrialised countries.
What are remittances?
Money that migrants send home to their families via formal or informal channels.
What is interdependency?
If two places become over reliant on financial and/or political connections with one another, then they have become interdependent. For example, if an economic recession adversely affects a host country for migrant workers, then the economy of the source country may shrink too, due to falling remittances.
What are transnational cooperations (TNCs)?
These are businesses who operate across the world, operating in many countries as both makers and sellers of goods and services. Many of the largest are instantly recognisable ‘global brands’ that bring cultural change to the places where products are consumed.
How do transport and trade link together?
Communication and transport technologies have been improving for thousands of years. Each new breakthrough has helped trade to grow in geographical scale. Technological progress brings unexpected changes in the ways which companies can operate.
Capitalist economies are always seeking to increase profits. One way to achieve this involved conducting research into transport technology to help build new global markets. Economic needs drive some technological changes when companies foster innovation.
How was steam power an important innovation in transport?
Britain became the leading world power in the 1800s using steam technology. Steam ships (and trains moved goods and armies quickly along trade routes into Africa and Asi.
How were railways an important innovation in transport?
In the 1800s, railway networks expanded globally. By 1904, the 9000km Trans-Siberian railway connected Moscow with China and Japan. Today, railway building still remains a priority for government across the world. E.g the HS2.
How were Jet Aircrafts an important transport innovation?
The arrival of the intercontinental Boeing 747 in the 1960s made international travel more commonplace, while the recent expansion of the cheap flights sector, including easyJet and Ryanair, bought it in masses to richer nations.
How was container shipping an important transport innovation?
Around 200 million individual container movements take place each year. Some commentators describe shipping as the ‘backbone’ of the global economy since the 1950s. Everything from chicken drumsticks to patio heaters can be transported across the planet using intermodal containers. One of Chinas Vessels is 366m long, 48m wide and can carry 13,000 containers.
What is spatial division of labour?
This is the common practice among TNCs of moving low-skilled work abroad to places where labour costs are low. Important skilled management jobs are retained at the TNC’s HQ in the origin country.
What are intermodal containers?
Large capacity storing units which can be transported long distances using multiple types of transport, such as shipping and rail, without freight being taken out of the container.
What is the ‘shrinking world’?
Thanks to technology, distant places start to feel closer and take less time to reach.
How has globalisation caused the time-space compression?
Heightened connectivity changes our conception of time, distance and potential barriers to the migration of people, goods, money and information. This perceptual change is called time-space compression. As travel times fall due to new invention ps, different places approach each other in ‘space-time’: they begin to feel closer together than they did in the past. This is also known as the shrinking world effect.
How have easyJet made international trade easier?
The easyJet airline was founded in 1995 and it began as a small venture running flights solely within the UK. Most of Europes major cities are now interconnected via EasyJet’s cheap flight network.
They initially had just two aircraft. Inaugural flights from London Luton to Edinburgh and Glasgow were supported by the advertising slogan ‘Making flying as affordable as a pair of jeans - £29 one way’. Flights to Barcelona then commenced as the airline expanded at breakneck speed. It now has around 300 different flight routes within the EU and even ones that extend beyond, e.g to Turkey.
By 2014, the company owned 200 aeroplanes carrying 65million people each year, and bringing nearly £4 billion in revenues. Places that easyJet travelled to instantly become more switched on to globalisation.
What are some important elements of ICT growth overtime?
-Telephones and the telegraph across the Atlantic replaced a 3 week boat voyage in 1860.
-Broadband and fibre optics in the 1980s and 1990s, thus meant large amounts of data could be quickly moved through cyberspace.
-GIS and GPS: Constantly deliver position and time data to users around the world. Deliveries can be tracked by companies that use vehicle-tracking systems, helping the growth of global production networks to be managed.
-The internet, social networks and Skype: since the 1960s, connectivity between people and places has grown exponentially. By 2014, 5 billion Facebook ‘likes’ were being registered globally everyday.
How has technology aided economic globalisation?
ICT allows managers of distant offices and plants to keep in touch more easily. This has helped TNCs to expand into new territories, either to make or seek their products. Each time a barcode is scanned in an M&S in the UK, an automatic adjustment is made to the size of the next order placed with suppliers in distant countries like Kenya.
How has technology aided social globalisation?
The maintaining of long-distance social relationships through ICT use is a factor that supports migration. Since 2003, Skype has provided a cheap and powerful way for migrants to maintain a strong link with family they have left behind.
How has technology aided cultural globalisation?
Cultural traits, such as language or music, are adopted, imitated and hybridised faster than ever before. During 2012, South Korean singer Psy clocked up over 1.8 billion online views of ‘Gangnam style’.
How has technology aided political globalisation?
Social networks are used to raise awareness about political issues and to fight for change on a global scale. Environmental charities like Greenspace spread their message online, while the militant group Isis has used social media to spread its message of terror globally, and to gain new recruits.
How are mobile phones changing lives in developing countries?
In countries where the lack of communication infrastructure has traditionally been a big obstacle to economic growth, mobile phones are now changing lives for the better by connecting people and places. In 2005, 6% of Africans owned a mobile phone, but now in 2015 this has risen to 70% due to falling prices and a growth of provider companies. There is also a rising uptake in India, meaning there are now more mobile phones on the planet than ever.
How did electronic banking change life in Kenya?
In 2007, Safaricom launched M-Pesa, a simple mobile phone service that allows credit to be directly transferred between phone users. This caused:
-The equivalent of 1/3 of the countries GDP to be sent through the system annually.
-People in towns and cities use mobiles to make payments for utility bills and school fees.
-Rural fisherman and farmers could check market prices before selling.
-Women in rural areas are able to secure micro loans from development banks by using their M-peas bills as proof that they have a good credit record. This new ability to borrow is playing a vital role in lifting rural families out of poverty.
Why do political factors matter in globalisation?
Sometimes, global flows cannot take place due to political barriers that national governments have created. On the face of it, this may seem surprising, given that global flows can stimulate economic growth. But, global flows may also be viewed as threats:
-Imports of raw materials and commodities can threaten a nations own industry.
-Migrants can bring cultural change and religious diversity: not everyone welcomes this.
-Information can provide citizens with knowledge that their governments find threatening.
Because of this, some governments attempt to protect themselves from FDI of overseas TNCs.
How can international organisations help with globalisation?
For decades, 3 international organisations have acted as ‘brokers’ of globalisation through the promotion of free trade policies and FDI. These are the International Monetary Fund (IMF), the World Bank and the World Ttrade Organisation (WTO). The ‘Bretton Woods institutions’ were established after WW2. The guiding principle was to restabilise the world economy and avoid a return to conditions in the 1930s Great Depression, which was caused partially by protectionism causing a fall in world trade, with nations blocking foreign imports with tariffs.
Will the Bretton Woods players maintain their influence in the future?
It is impossible to know, but there are several issues to explore:
-The global financial crisis in 2008/9, which originated in the US and EU money markets, and had negative implications on the entire world economy. As a result, governments in developing countries have become more sceptical of financial advice from the IMF and World Bank.
-Geopolitical changes means that the new alternatives are emerging to the Bretton Woods institutions. Developing countries in search of assistance can instead approach China Development Bank. China loaned more than US$110 Billion to developing countries in 2010, which exceeded World Banks value. In 2014, the BRICS group of nations announced its establishment.
What is foreign direct investment?
A financial injection made by a TNC into a nation’s economy, either to build new facilities (factories or shops) or to acquire, or merge with, an existing firm already based there.
What are the BRICS groups?
The four large, fast-growing economies of Brazil, Russia, India, China and recently also South Africa.
What is the role of the IMF in globalisation?
The IMF channels loans from rich nations to countries that appeal for help. In return, the recipients must agree to run free market economies that are open to outside investment. As a result, TNCs can easily enter the countries. The USA exerts significant influence over IMF policy despite the fact that it has always had a European president.
