Topic 4.1 Globalisation Flashcards
Mrs Carr
What is globalisation?
Globalisation is the process of economic integration between countries and regions of the world
What are the causes of globalisation?
- The deregulation of markets
- Political changes
- The removal of barriers to trade
- The lowering of transportation costs
- Improved communication systems
What are the Impacts of globalisation?
What are the advantages of multinationals?
- Provide employment and create better living standards
- Infrastructure development due to investment
- Introducing new technology
- Increased economic growth
What are the disadvantages of multinationals?
- Can cause domestic businesses to fail
- Multinationals can be accused of destroying local culture
- Negative environmental impact
What is economic growth?
- Economic growth occurs when a country produces more goods and services in one year than the year before
How is economic growth measured?
- GDP
- Literacy rates
- HDI
- Healthcare
What are the positives of economic growth?
- Increased consumer spending, leads too increased sales
- Increased expansion opportunities
- Increased profits and investment for businesses
What are the negatives of economic growth?
- Increased competition from expanding businesses
- Increased prices leading to inflation
- Shortage of labour leading to increased costs and wages
- Increased exchange rates
What is a BRIC economy?
- Brazil, Russia, India, China
- Emerging superpowers as they have one of these: high populations, access to resources, regional influence and high economic growth
What is a MINT economy?
- Mexico, indonesia, Nigeria, Turkey
- They have the potential to become superpowers
What are the indicators of growth?
- Income levels
- Education (Literacy rates)
- Healthcare (life expectancy, child mortality rates and access to healthcare)
Is HDI a good measurement of growth?
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What are the four types of protectionism? (Tarrifs)
- A tax placed on imports to increase its price and lower the demand
- Consumers will switch to domestic goods
- Used to restrict imports
What are the four types of protectionism? (Quotas)
- A type of tariff places on imports
What are the four types of protectionism? (Subsidies)
- A way for the government to protect their domestic markets
- Money is given to local producers o make their goods cheaper and increase demand and make them more competitive
What are the four types of protectionism? (Government action)
- legislation on product quality requirements to restricting products that do not meet them
- Exchange controls - Limiting the foreign exchange that can move between countries
- Preferential state procurement policies - Where a government favours domestic businesses
What is protectionism?
When governments put in place policies to stop overseas producers freely selling goods in our country (Restrict trade)
What is free trade?
When governments put in place policies that allow producers from overseas nations to freely sell their goods in our country (Promote trade)
What are the arguments for protectionism?
- Protect key strategic industries (eg. farming)
- Protect domestic jobs
- Raise money for governments
- Reduce trade deficit
- Protect new infant industries
What are the arguments against protectionism?
- High import prices may not decrease demand
- Tarrifs can raise consumer prices
- Domestic firms may not become more competitive
- Quotas require monitoring
