Lesson 5 : Measuring Globalisation- Using the AT Kearney and KOF Indexes

What are global hubs?

Cities/ cores that demonstrate a number of intense connections to other businesses/cities around the world

What is cumulative causation process?

Where the best connected places continue to be able to specialise and produce goods, continuing to stay the best connected places

What are the unequal impacts of globalisation?

• Clusters of globally significant economic activity focused in core regions

• Upward transition areas benefit from FDI

• Offshoring and outsourcing occur from the core regions

• Downward transition areas lose out due to loss of FDI

• Resource frontiers experience economic boom and bust as value of products changes due to demand from upward transition areas/ core regions

What is the global core-periphery model?

A map that shows cumulative causation process?

How are flows measured?

Volume of international trade, migration of people, the value of foreign direction investment

How are technologies measured?

• Extent of internet usage

• Extent and types of information flow

• Types of telecommunications available

How are movements measured?

• Volume of international air traffic

• Number of international tourists

How can media be measured?

• Extent and spread of global advertising

• Extent and spread of music and TV

What types of globalisation do the KOF globalisation index measure?

• Economic globalisation'

• Social globalisation

• Political globalisation

How is economic globalisation measured?

• Cross-border transactions

• Volume of FDI

How is social globalisation measured?

Cross border contacts- letters, tourists, foreign residents, information flows

How is political globalisation measured?

• Number of foreign embassies

• Country’s membership to NGO’s

• Participation in peacekeeping activities

What are the weaknesses of the KOF index?

• Data for some countries is not available

• Technological developments means some indicators e.g letters look dated

• Trade flows will not include informal economy flows= underestimate degree of globalisation of developing and emerging countries

What are the 5 categories of of the AT Kearney index?

• Business Activity

• Human Capital

• Information Exchange

• Cultural Experience

• Political Engagement

How is Business Activity measured/scored?

• Capital flow

• Market Dynamics

• Number and type of TNC’s present

How is Human capital measured/scored?

• Availability of education'

• Levels of enrolment

How is information exchange measured/ scored?

• Access to information through the internet

• Access to information through other media sources (newspapers, books)

How is cultural experiences measured/scored?

• Access to major sporting events

• Access to museums

How is political engagement measured/scored?

• Political events

• Number of Think tanks

• Number of embassies

What are the similarities of the 2 indexes?

• Both indexes measure and collect data for multiple aspects and strands- this means the indexes takes a holistic view

What are the differences between the 2 indexes?

• Different scale of focus- KOF focuses on a national scale, whilst AT Kearney works on a city level

What are the advantages of KOF ?

• Easy to draw comparisons between nations.

• Long-standing data collection allows people to make comparisons over time

• Over 200 countries with data- far reaching impact

What are the disadvantages of KOF?

• By being national in scale, it doesn’t highlight discrepancies between places in a nation

• Flows are not representative e.g lack of regard for informal economy and some flows are outdated

What are the advantages of AT Kearney?

• Highlights variation in connections between cities/players in a country-focused on global hubs which are drivers of globalisation

• Data is up to date and easier to collect as it is on a smaller scale

What are the disadvantages of AT Kearney?

• Focus on larger, more famous cities- biased and not fully representative

• Some measures, such as political engagement and cultural experiences are subjective