Paper 3: power, places and networks

Geography IB Paper 3 power, places and networks (core unit 4) HL only

Globalisation

Globalisation

The process of interaction and integration among people, countries and governments worldwide

KOF index

A measure of globalisation covering economic (36%), social (38%) and political (26%) dimensions, calculated using 24 variables

How does the KOF measure economic dimensions?

Long distance flow of goods, services and information

How does the KOF measure social dimensions?

Spread of ideas, information, images and people:

• Tourism in and out

• Group membership

• “Cultural proximity“ including how many IKEA and McDonald’s stores a country has

• Letters/telecoms in and out

How does the KOF measure political dimensions?

Diffusion of government policies

Strengths of the KOF index

• Uses data collected since 1970 so temporal changes can be seen

• Calculated using many variables (24)

Limitations of the KOF index

• “Trade in books“ has limitations as an indicator as low literacy rates or differing disposable income levels may affect this

• Criticism of number McDonald’s and IKEA stores as a measure (West-centric)

• Some countries may not want to join international groups because of hostility to other individual countries

What scale do the KOF and EY index use?

0-100 with 100 being the most globalised

How does the Ernst and Young index of globalisation differ from the KOF?

It is based on the KOF but each dimension is weighted differently so the economy accounts for 60% of a country’s global ranking and the other two factors are worth 20% each.

In 2016, Netherlands had the highest KOF score but Ireland had the highest EY score (89.6)

Imperialism

A policy of extending power through colonialism

Capitalism

A policy of private ownership

Communism

All assets/property are owned by the state

What is meant by a global superpower (with example)?

Superpowers are countries with global influence and economic, cultural, military and/or geopolitical power. Eg. the USA which has an annual military expenditure of $600B.

Frank’s dependency theory

The idea that resources flow from a periphery of poor countries to a core of wealthy states enriching the latter at the expense of the former

Brain drain

The movement of skilled/intelligent workers from the periphery to the core

How has the USA become a superpower (physical geography)?

• Rich in resources (coal, oil, agricultural land)

• Two coastlines: excellent access to Eastern and Western markets

• Geographical size

How has the USA become a superpower (political reasons)?

• Suffered less damage in WWII compared to most of Europe so had a head start developing military and gave aid so gained allies

• UN headquarters, World Bank and IMF are based there

• Firm relations with Western Europe, commonwealth, Latin America and key Asian countries

Tariffs

The cost a country pays to import goods

How are tariffs advantageous to economy of the buyer country?

• Suppliers cannot sell as cheaply in the external market

• Internal products are cheaper so they are more attractive to buyers

What is G8?

A group of the world’s 7 largest economies: USA, UK, France, Germany, Italy, Japan and Canada. Set up as a forum to coordinate global policy (formerly G8 until 2014 when Russia was “suspended indefinitely“ following the annexation of Crimea).

Strengths of G7

• Strengthened international economic/security policies

• Facilitates discussion of global issues such as climate change

• Small enough to meet consensus fast

• Supported disarmament programmes

Weaknesses of G7

• Only represents the West

• May not be an accurate grouping of the world’s biggest economies in light of the emergence of China

• Focus on G20 has weakened it

• Was not able to stop Russia’s actions in Crimea in 2014 by threatening suspension

What is G20?

Another intergovernmental forum comprising 19 countries and the EU

Strengths of G20

• Represents 65% of the world’s population (instead of G7’s 10%)

• Larger group with more diverse ideas

• Does not only represent Western interests

Weaknesses of G20

• Does not represent Africa at all

• Is a large group so cannot meet consensus quickly

What is equity participation?

The ownership of shares: a company, infrastructure, property or business is shared between different parties.

Remittances

Transfers of money from a foreign worker to family members or other individuals in the worker’s home country

Top-down aid

• Large-scale projects

• Carried out by governments or international organisations

• Usually well-funded

Bottom-up aid

• Small-scale projects

• Involves local communities, run by locals for locals

• Usually not as well-funded

Advantages of aid in general

• emergency relief after natural disasters

• Often necessary

• Positive multiplier effect if spent effectively

• Can improve quality of life

• Sustainable development through providing skills/education

Disadvantages of aid in general

• Can develop dependency on aid

• May fuel corruption

• Can undermine the local economy

• Recipients may be forced into terms that don’t benefit them

What is the case study for top-down aid?

Wheat in Tanzania

Top-down aid in Tanzania case study (wheat)

• Led by Canadian government (finance, advice, equipment)

• Increased food production, self-sufficiency and economic focus on the most valuable crop :)

• Historical farming community alienated, food becomes unaffordable for locals, locked into expensive imports :(

What is the case study for bottom-up aid?

Oxfam in Tanzania

Bottom-up aid in Tanzania case study (Oxfam)

• Community-led youth schemes

• £3000 used for building materials, tools, etc

• Positive multiplier effect, healthcare, food production, employment, strengthens community, skills development, independence :)

• Doesn’t address main causes of poverty (poor trade, decreasing exports) :(

Shop Soko, Kenya

• Online e-commerce site that sells authentic African jewellery on a global market

• The start-up received support through the World Bank

• 70% of the artisans are women

OECD

Organisation for Economic Cooperation and Development (38 member countries). Aims to:

1) Restore confidence in markets

2) Re-establish healthy public finances

3) Support NEE development and “green growth“

4) Equip people with skills for emerging jobs

OPEC

Organisation of Petroleum-Exporting Countries: aims to coordinate and unify petroleum policies in member countries.

IMF

The International Monetary Fund. Like the World Bank, it is a financial institution that provides loans to developing countries to reduce poverty. Finances development often focusing on investment projects and helping countries recover after natural disasters/wars.

Strengths of the IMF

• Has 180+ member states

• Provides loans for poor countries to aid development and recovery after natural disasters, wars, etc

• eg. the IMF and World Bank helped rebuild a devastated post-war Japan

Weaknesses of the IMF

• Dominated/run by a small number of wealthy countries

• Some argue it is pushing Western interests

• Outcomes can sometimes be negative (increased poverty) especially when SAPs are put in place

What are SAPs?

Structural Adjustment programmes are when a country, in return for accepting aid/a loan, must make adjustments to their economy. This could include doing things like: liberalizing trade, encouraging FDI, charging for some basic services (education/healthcare/etc) and having austerity measures reducing social expenditure

What is the case study for an SAP?

Groundnuts in Senegal

SAPs: ground nuts in Senegal details

• Senegal borrowed money from the WB

• WB enforced SAPs

• Trade was liberalized and tariffs removed on imports, firms were privatised and governments forced to cut spending

• SAP resulted in Senegal paying more on debt than on healthcare and education combined

What is the difference between a nation and a state?

• A state is an independent political entity with clear geographical boundaries

• A nation is a large population that shares the same culture/language/traditions/etc. Not defined by borders

• States often coincide with nations- “nation-states“

Sovereignty

The highest power and authority

Supranational institution

A type of multinational political union where negotiated power is delegated to an authority by government or member states (eg. the EU)

TNCs

Transnational corporations

What are the two examples of TNCs studied?

Apple and Tata

Apple

• Based in the USA

• Has 785 suppliers in over 30 countries (including 349 in China)

• Ongoing issues in supply chain

• Chinese labour laws do little to protect workers

• In 2010 apple’s main supplier foxconn put up mesh netting around its buildings and increased its wages following 18 attempted worker suicides

Tata

• Based in India

• Comprises over 100 companies including cars, consulting, tea/coffee, hotels, power, transport, steel and chemicals

• Operates in over 80 countries and employs 600k people

• Has received criticism for its forward-thinking philanthropy being bypassed for profit

Advantages of TNCs to host country

• Local businesses may benefit from TNC training

• TNCs often support local infrastructure projects such as roads, telecoms, etc

• Provide jobs for people in host country and local people receive a wage for their work

Disadvantages of TNCs to host country

• Some TNCs disrespect human rights and employ children

• May prevent the growth of domestic manufacturing industry

• Pollution of surrounding environment

Protectionism

The theory or practice of shielding country's domestic industries from foreign competition by taxing imports

New Development Bank

• Established in 2014 by BRICS with headquarters in Shanghai

• Established to compete with Western interests

• Important step of cooperation among BRICS

• Focus on infrastructure and sustainable development

What are the four illegal flows studied?

Drugs, fraudulent medicines, human trafficking and counterfeit goods

Drug trafficking

• The production and trade of illegal substances

• Global drug trade is estimated to be worth $300B or 1%

• Associated with violence (in the US, 5% of murders are estimated to be drug-related)

Fraudulent medicines

• Diabetes, depression, high blood pressure

• WHO believes that 1% of meds in HICS and up to 30% in LICs are counterfeit

Counterfeit goods

• Generates over $250B annually

• Contributes to labour exploitation, environmental damage and health implications

• Unregulated

• Implicates criminal groups such as Mafia

• Reduced tax revenues for governments

• Linked to bribery and corruption

Human trafficking

• UNODC estimates there were 27,000 victims between 2010 and 2012

• 70% of victims are international (frequently taken from poor countries to rich ones)

• Complex process involving passports, visas, transport and supervision

Economies of scale

The concept that, the larger the scale on which a good is produced, the lower the cost per-unit

What is time-space convergence/distance decay?

The idea that the world is effectively shrinking due to improvements in infrastructure and transport making long distances faster to travel

Name four technological developments that have facilitated international trade

Containerisation, the internet, satellites and planes

How has containerisation facilitated international trade?

• Began in the 1960s

• The use of containers of a standard size

• Enables them to be moved between boats/trains/lorries worldwide

• 16m containers are shipped each year

How has the internet facilitated international trade?

• Companies don’t have to pay for shopfronts, cutting costs

• You can sell to a bigger audience

• Fewer employees needed

• Companies can communicate easily with consumers and each other

What is a free economic zone?

Areas that encourage FDI by making certain companies or places exempt from tax- leads to positive multiplier effect from TNC investment

What is the case study for a free economic zone?

Incheon Free Economic Zone (IFEZ)

Incheon Free Economic Zone: details

• Created in 2002 when SK started the North Asian countries’ business hub

• Maximised incentive/opportunities for FDI including tax breaks

Positives of the IFEZ

• Ideal as a FEZ because it’s a coastal city with an airport and sea port

• Has a well-qualified workforce as it’s close to Seoul, the capital

Negatives of the IFEZ

• Some incentives offered may lead to expensive foreign schools, which could widen the educational gap between rich and poor

• Foreign investors perceive a threat of war from North Korea

What is an Export-Processing Zone (IPZ)?

A specific type of FEZ which specialises in manufacturing for export. In an IPZ you must pay to dock your ship but there is no tax on imported goods.

What is the case study for a migration control scheme?

Migration controls in the USA

Migration controls in the USA: details

• Some US citizens are worried about Mexican immigrants bringing drugs/crime into the US

• Extensive border fencing and increased patrols around cities such as San Diego and El Paso

Migration controls in the USA: negatives

• Cost to illegal immigrants has increased as they are forced to hire smugglers

• Flow of migrants has been pushed into more remote locations