4.1.1 - globalisation

define globalisation

the economic integration and interdependency of different countries through increasing freedoms in the cross-border movement of people, g+s, technology and finance

what has globalisation led to in terms of industry

developING nations: industrialisation (increase in manufacturing)

developED nations: deindustrialisation (decrease in manufacturing)

because of globalisation, countries are now more…

…interdependent

4 main characteristics of globalisation

COMT:

easy flows of capital (finance) across borders

increasing foreign ownership of companies

increasing movement of labour + tech across borders

free trade in g+s

value of global trade in 2000 compared to 2020

2000 —> $6.45 trillion

2020 —> $19 trillion

6 main factors contributing to globalisation in the past 50 years

TLC TWD:

improved technology

trade liberalisation

containerisation

transnational corporations

end of war

deregulation

improved technology

better communication —> world more connected

trade liberalisation

organsations like the World Trade Organisation (WTO) helping more countries open up to free trade

containerisation

better shipping industry = better economies of scale (cost per unit goes down of shipping stuff abroad)

transnational corporations

more of them (eg. apple, amazon)

end of war

EXAMPLE: end of cold war

opened up former communist countries + enlarged the global labour supply

deregulation

1990s - deregulated many financial markets

led to expansion of global financial services + more access to capital

impact of globalisation on… individual countries

rising education levels

rising inequality

impact of globalisation on… firms

more efficient production

monopoly power of multinationals

impact of globalisation on… consumers

lower prices (greater competition)

increase in organised crime

impact of globalisation on… workers

rising incomes

structural unemployment from shifting sectors

impact of globalisation on… the environment

sustainable trade policies (international agreements)

depletion of natural resources