Globalization and Its Impact

Flashcards covering key vocabulary related to globalization, its impact, definitions, and significant concepts discussed in the notes.

Globalization

The interdependence among nations for trade of goods & services, access to global financial markets, movement of labor, and foreign loans.

MNCs

Multinational Corporations; companies that operate in two or more countries.

TNCs

Transnational Corporations; similar to multinational corporations, these operate across borders but are characterized by a more integrated approach to international markets.

WTO

The World Trade Organization; a UN entity that governs international trade rules and aims to ensure smooth trade flows between nations.

Deregulation

The reduction or elimination of government intervention in an industry to promote competition

Economies of scale

The cost advantage that arises with increased output of a product

Discretionary income

Income available to a person after taxes and necessary expenses, which can be spent on non-essential goods.

Consumer Sovereignty

The idea that consumer preferences and choices dictate the production of goods and services.

Foreign investment

Investment made by a company or individual in one country in business interests in another country.

Technological advancement

Improvements in technology that increase efficiency, affect communication, and enhance global commerce.

Globalization

The interdependence among nations for trade of goods & services, access to global financial markets, movement of labor, and foreign loans.

MNCs

Multinational Corporations; companies that operate in two or more countries.

TNCs

these operate across borders but are characterized by a more integrated approach to international markets.

WTO

The World Trade Organization; a UN entity that governs international trade rules and aims to ensure smooth trade flows between nations.

Deregulation

The reduction or elimination of government intervention in an industry to promote competition

Economies of scale

The cost advantage that arises with increased output of a product

Discretionary income

Income available to a person after taxes and necessary expenses, which can be spent on non-essential goods.

Consumer Sovereignty

The idea that consumer preferences and choices dictate the production of goods and services.

Foreign investment

Investment made by a company or individual in one country in business interests in another country.

Technological advancement

Improvements in technology that increase efficiency, affect communication, and enhance global commerce.

Positive Impacts of Globalisation

1. Increased Economic Growth: Nations can specialize and trade, increasing overall \text{GDP}.
2. Lower Prices: Competition and economies of scale reduce costs for consumers.
3. Improved Living Standards: Access to a wider variety of goods and higher discretionary income.

Negative Impacts of Globalisation

1. Structural Unemployment: Job losses in domestic manufacturing as production moves to lower-cost regions.
2. Environmental Degradation: Increased carbon emissions from transport and resource depletion.
3. Economic Inequality: Wealth gaps can widen between developed and developing nations.

Offshoring

The relocation of business processes or production to a lower-cost foreign country to gain a competitive advantage.

Cultural Homogenization

The process by which local cultures are transformed or absorbed by a dominant global culture, often through the influence of MNCs.

Economic Interdependence

A consequence of globalization where the health of one nation's economy is tied to the performance of its trading partners.