Topic 3 - EQ1 - Globalisation Flashcards
What is globalisation?
Globalisation is used to describe a variety of ways in which places and people are now more connected with one another than they used to be. The International Monetary Fund (IMF) defines globalisation as: “the increasing integration economics around the world, particularly through the movement of goods and services and capital across borders. There are also broader cultural, politically and environmental dimensions of globalisation”
What are the 4 main strands of globalisation?
Economic globalisation
Social globalisation
Political globalisation
Cultural globalisation
What is economic globalisation?
The increasing integration economies around the world caused and characterised by:
- The growth of TNCs accelerating cross border exchanges of raw materials, goods, etc.
- The growth in IT supports the growth of complex spatial divisions of Labour and a more interconnected economy
- Online e-commerce e.g. Amazon
- TNCs
What is social globalisation?
The increasing social interconnectivity around the globe creating a new social network which goes beyond borders caused and characterised by:
- International migration creating extensive family networks across borders
- Social inter connectivity has grown thanks to spread of universal connectivity
- Global rise 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
- The spread of universal connections such as mobile phones, the internet and email
What is political globalisation?
Political globalization refers to the growth of the worldwide political system, both in size and complexity, this system has increased the importance of IGOs and decreased the importance of the Nation State, political globalisation has been caused and characterised by:
- The growth of trading blocs (e.g. EU, NAFTA) allows TNCs to merge in neighbouring countries, while reduced trade restrictions and tariffs help markets grow
- Global concerns such as free trade and response to disasters/war
- The World Bank, IMF and WTO work to harmonise national economies internationally
What is cultural globalisation?
Cultural globalisation refers to the rapid movement of ideas, attitudes, meanings, values and cultural products across national borders caused and characterised by:
- ‘Successful’ Western cultural traits come to dominate in some territories, e.g. the ‘Americanisation’ of tastes and fashion
- Complex outcomes as old local cultures merge and meld with globalising influences
- Circulation of ideas information has accelerated due to 24/7 reporting
What has happened to the cost and speed of communications?
Speed ⬆️ Cost ⬇️. More countries are becoming increasingly interconnected and so the world is shrinking.
What have been some financial impacts of globalisation?
- Global capitalism spread by IMF
- Cheap Labour in developing countries helps supply wealthier nations with goods
- Trillions of dollars exchanged globally by electronic means
What have been some political impacts of globalisation?
- Some TNCs seek to influence how people think (and thus the political climate) across the globe (e.g. Rupert Murdoch’s news empire)
- International political organisations and groups have been able to expand and promote economic growth (e.g. EU has promoted economic growth across the EU, like in the peripheral area of Cornwall of the UK pre-Brexit)
- TNCs can intervene in the governance of national governments
What have been some impacts on population of globalisation?
- Skilled workforce can move to where they’re most in demand with higher incomes and rewards
- Fast air transport allows international migration with truly global companies
- Movement enabled whilst retaining jobs as a result of globalisation
What have been some of the impacts of globalisation on communication and information?
- Cheaper global phone networks and increased communication pathways allows rapid exchanges of information and news to reach around the globe instantly (e.g. Paris terror attack or 911)
- Allows instant communication between people on opposite areas of the globe (in result leading to increased globalisation)
Who is globalisation drive by? Countries across the globe or a handful of drivers?
Drive by key players from a handful of powerful countries - USA, Japan, Europe
What is a major factor that is allowing for an increase in globalisation? (Related to infrastructure)
Transport developments
What are the benefits of container ships for shipping goods across the globe?
- Less fuel being used per contained as more containers are used on one ship (18000 container ships use 20% less fuel per container than one carrying 10,000 containers)
- Many more goods can be transported on larger ships
- Ships bring high value goods to Europe and take back low-value waste in return
What are the problems of container ships for shipping goods across the globe?
- High cost as there are many containers
- Shifted balance of trade towards Asia and always from Europe
- Almost everything on ships made in China exploiting lower labour costs
- Plastics often taken to China to be incinerated
What are the benefits of e-tailing (electronic online retailing)?
- Quick delivery times for customers, and quick delivery also saves companies like Amazon money as large items do not need to be stored in warehouses for long periods of time
- Offers manufacturing companies, sellers, writers and musicians access to a global market for their sales through its warehouses, encourages entrepreneurship and innovation
- Amazon now offers services to customers in 180 countries offering access to people across the globe
- Offers cheaper items than in shops
What are the problems with e-tailing (electronic online retailing)?
- People in the 21st C buy and throw away more due to the ease of buying cheap goods (over 30% of what is purchased on the globe will be thrown away within a year, not including packaging)
- Goods often have a human rights cost (sweatshops) and environmental costs (unrecyclable packaging or rare metals)
- Creates throw away society
What are the social impacts of e-tailing companies like Amazon?
- Increased globalisation and access to goods from around the world
- Offers a wide range of services in one place which makes it easier for consumers
- Ruins markets and economies of developing countries and destroys business owner jobs
- Human cost
What are the economic impacts of e-tailing companies like Amazon?
- Reshaped economic landscape with more retailing done online
- Easier to register in tax havens
- Harder to trace owed payments
- Job loss
- Ruins economies of developing countries where people’s businesses rely on loyal local customers
What are the environmental impacts of e-tailing companies like Amazon?
- Products often require lots of plastic or un-recyclable packaging
- Approximately 30% of what is purchased will be thrown away within a year
How have 21st C developments in ICT and communication given new opportunities to businesses?
- Establishment of online marketplaces have given small businesses access to a global customer base
- Has challenged the old supermarket model and due to click and collect or grocery deliveries
- Made possible for online retailers to sell a variety of things replacing old specialist businesses that weren’t maybe as effective (e.g. Amazon made use of technological developments, Blockbuster didn’t and failed)
- It has directly led to the development of the idea of the digital economy with supporting infrastructure (worth 1.5 trillion USD in 2015)
Explain how changes in technology have sped up (or contributed to) the process of globalisation (4 marks)
P1: Cultural globalisation has been sped up as cultural traits, such as language or music, are adopted/imitated and hybridised faster than ever before. (E.g. Korean Gangnam Style clocked up over 1.8 billion views in 2012)
P2: Political globalisation has been sped up quicker than ever by technology. (E.g. the terrorist group ISIS in the Middle East has used the internet, especially chat rooms and online games, to radicalise vulnerable people across the globe to join their terror group, pre-technology they wouldn’t have been able to recruit so efficiently.)
What are the big 3 international political and economic organisations we study?
- The IMF (International Monetary Fund)
- The WTO (World Trade Organisation)
- The World Bank
What is an example of joining international political and economic organisations having devastating consequences?
In 1995 Pakistan joined the WTO, to comply with WTO trade rules this meant that Pakistan had to open up its fishing grounds for foreign competition. Until then, it had enforced a 200 mile exclusion zone around its coast to protect Pakistani fishing communities. After 1995 TNCs (many from India) and their deep sea trawlers took and still take most of the catch. Pakistan’s own fishing communities are left in poverty.
Who created the big 3 international political and economic organisations we study? When? Why?
The USA. Post-WW2. To combat the spread and influence of communism through economic development and it was also to maintain international financial stability after the war.
What does the IMF aim to do? How do they do this?
The IMF aim to maintain international financial stability and stabilise currencies, in order to maintain economic growth and develop the global economy.
To do this the IMF lends money and in return for loans it tries to force countries to privatise gov’t assets in order to increase the size of the private sector and generate profit and wealth.
How does what the IMF does enable globalisation?
By encouraging gov’ts to privatise and sell of gov’t assets, the opportunity for FDI is opened up and it means that TNCs from other parts of the world can buy these assets brining in money and globalising the economy.
What does the WTO aim to do? How do they do this?
Use trade to generate economic growth in the world’s poorest regions. The WTO believes in free and fair trade and ‘trade liberalisation’.
To do this they seek to encourage all trade between countries free of tariffs, quotas and restrictions (even having preferences on trading with some countries over others). By 2016 it had 162 members.
How does what the WTO does enable globalisation?
Increasing trade between countries across the globe means that products are spread around the globe and this allows a spread of culture and capital around the globe, and it makes countries and cultures connected via trade relations.
What does the World Bank aim to do? How do they do this?
World Bank was formed with the purpose of financing economic development.
To do this the World Bank uses bank deposits placed by the world’s wealthiest counties to provide loans for stimulating development in countries that agree to certain conditions concerning repayment and economic growth. It also focuses on natural disasters and humanitarian emergencies and provides generous loans to help countries rebuild in the wake of them.
How does the World Bank enable globalisation?
It stimulates economic growth which allows countries to play a bigger role on the world stage and a bigger role in trade. More developed countries are more likely to forge connections to other countries.
What are trading blocs?
Trade agreements between countries to help improve trade and trading conditions by reducing or removing trade barriers and protectionist policies and promoting free trade between members of the trade bloc. Trading blocs place tariffs on imports from non-member state protecting industry in the bloc. Increases globalisation as it makes countries more economically interconnected.
What are some trade bloc examples?
EU, NAFTA, ASEAN, APEC
Why have some been critical of trading blocs?
Some blocs subsidise their producers to protect them from the influence of the global market despite this being against WTO rules (e.g. EU subsidising farmers). Also, there is an argument that these blocs are elitist, exclusionary, clubs which allow development inside them but actively hinder and limit the development of countries outside the trading blocs.
