topic 7.7 changes as a result of the world economy Flashcards
Multinational (transnational) corporation:
:a company that operates in more than one country
Where are most of these headquartered? (multinational transnational corporation)
Core countries
Outsourcing
sending parts of the process to a different company or country to be completed
Why have many companies outsourced to peripheral countries?
Cheaper land, cheaper labor, closer to resources, less environmental and labor regulations
What type of jobs normally get outsourced to peripheral countries?
Manufacturing jobs, back office functions, etc.
How have multinational corporations and outsourcing contributed to the rise of English as a global lingua franca?
Since most of the companies that are outsourcing are headquartered in America/other core countries, knowing English is important to conduct business
What county is most attractive when looking to outsource back office functions from American companies? Why?
India–was once a British colony
Maquiladoras
Where are they located?
Mexico
Maquiladoras
Why there?
Cheaper labor, cheaper land, less environmental and labor regulations, and still close to the U.S.
Maquiladoras
How are they beneficial to that country?
They provide jobs to Mexicans
Special Economic Zones (SEZs):
an area within a country that offers more favorable economic regulations (such as tax benefits or no tariffs) to attract foreign businesses
Which country has a LOT of SEZs?
China
Export Processing Zones (EPZs):
an area within a country that is subject more favorable regulations (usually including the elimination of tariffs) to encourage foreign investment and the manufacturing of goods for export
Free Trade Zones (FTZs):
a relatively large geographical area within a country in which businesses pay few or no tariffs on goods to encourage or facilitate its role in international trade
Four Asian Tigers/Dragons:
Which countries?
Hong Kong, Singapore, Taiwan, and South Korea
Four Asian Tigers/Dragons:
What type of industry are they focused on?
Export oriented industries
International Division of Labor:
a pattern of production and labor in which different countries are engaged in distinct aspects of production
Fordism
a highly organized and specialized system for industrial production that focuses on efficiency and productivity in mass production; named after Henry Ford
Post-Fordism
system focused on small-scale bath production for specialized market and flexibility that allows for quick response to changes in the market
Multiplier effect:
the economic effect in which a change creates a large changes, such as when a new manufacturing plant grows the economy by giving rise to more related jobs and services
Economies of Scale:
cost reductions that occur when production rises
Agglomeration
the tendency of enterprises in the same industry to CLUSTER in the same area
Just-in-time delivery:
a system in which goods are delivered as needed so that companies keep in inventory only what is needed for near-term production
Growth poles:
a place of economic activity clustered around one or more high-growth industries that stimulate economic gain by capitalizing on some special asset
