Globalisation

What is an economy of scale?

Costs are reduced by building up production, result of bulk buying. Increased efficiancy

What is Out-Sourcing?

When companies choose to relocate manufacturing to another country, often due to preferable conditions

How have planes contributed to globalisation?

• people can now travel anywhere at high speeds, covering oceans more easily and reducing journey times

• however, they emit a huge amount of carbon dioxide

How do shipping containers contribute to globalisation?

• bulk transport products, cutting transport costs. Expensive goods costs little to export

• however, there are too many ships in the sea as well as price wars arising from them

How has the internet contributed to globalisation?

• people can communicate with people all across the world within seconds, anyone can access anywhere

What are political aspects of globalisation?

• Trade barriers have been reduced to liberalise world trade

• TNC’s seek influence how people think

• Political organisations have expanded to promote economic growth

What are economic aspects of globalisation?

• Global Capitalism is spread through TNC’s

• cheaper labour in developing countries help to supply consumers in wealthier nations

• more goods and services

What is a quota?

When a limit is placed on the amount of goods coming into a country that are imported from somewhere else. Countries usually do this when another country has a more efficient industry than you.

What are advantages of trading blocs?

• easier trade of goods and services

• raw materials can be bought in bulk, saving money

• more sales equals more products being made

• production is more efficient which would increase overall trade

What was China’s open door policy?

• 1978

• They allowed Foreign Direct Investment (FDI) to enter from the outside world

• They opened SEZ’s that attracted foreign investment and technology, these played a huge rold in integrating China into the global economy

What is Foreign Direct Investment (FDI)?

• made by overseas company or organisations base itself in another country

• transfer of technology, which increases productivity and competivity

• however, countries may become dependent on FDI and it may bring countries into debt

How has China invested in other countries?

• Pakistan- built a new port with a 40 year lease, new route for goods with China

• Sri Lanka- deep water port, gave China control of port on 99 year lease as they couldn’t afford to repay loan

What is Off-Shoring?

when a company does work overseas either using itself or a foreign company

What is a New Economy?

when most GDP is earned through knowledge,media,law,tech,science,retail and leisure

What is OPEC?

• enables the co-operation of oil production between West Asia, North Africa and North/South America

• OPEC members get more revenue from high oil prices

• allows the regulation of supply of oil to set price of world oil

What is the EU?

• agreement between 27 countries within Europe

• promoting peace, equality, freedom and democracy

• citizens can go anywhere in the EU, political stability, increased trade due to the single market

• prevent future conflicts and integrate european economics. Increases international trade

How is Myanmar switched off?

• more rural areas/ agricultural based industries

• poorer/lower GDP

• poor infrastructure

• corrupt/dictatorship

• geographically isolated

How is Ireland switched on?

• more transport links with the rest of the world

• good infrastructure

• richer country and higher FDI

What is the Kearney Index?

• Firms analyse data falling into the categories of ‘business activity’, ‘cultural experince’ and ‘political engagement’

• measures both cities and countries

What is the KOF index?

• The Swiss Institute for Business Cycle Research measure globalisation by combining many data sets divided into 3 categories (economic, social and political)

• Measured every 4 years, 13 of the top 15 are European

What does KOF measure?

• TV ownership, number of embassies, internet subscriptions, trade as a % of GDP, Degree of tourism

What is the global shift?

• China’s open door policy resulted in alot of manufacturing shifting over to Asia

• TNC’s looked for areas that were cheaper

• India also began to open their doors to FDI encouraging further out-sourcing (1991)

How has FDI impacted India?

• FDI is increased in India due to it being a formally colonised country

• India is the home of Bollywood and a rapidly growing economy

• Positioned between China and Europe and they speak alot of English

• alot of genetically modified cell companies settle in India

What has happened to Leicester?

• The textile industry was extremely prominent with 6,500 people being employed at one point

• Commonwealth immigrants came over and became employed within the textile industry

• Leicester could not compete with overseas cheap prices and eventually the manufacturing factories went overseas

• many former industrial areas are now contaminated

What issues have arisen in Africa due to rapid urban growth?

• limited access to clean water due to a strain on facilities

• homes were built where water pipes should go meaning that clean water can’t reach certain areas

• climate change is resulting in water shortages

How is Bangladesh struggling with Urbanisation?

• highest population density in any country

• poor pay due to an unskilled economy

• government and police forces are corrupt

• limited access to clean water

• risk of climate change and sea level rise

What is Homogenization?

The reduction of cultural diversity through the population and diffusion of a wide array of cultural symbols

What are cultural costs of globalisation?

• features of smaller cultures may be lost forever

• consumerism is devaluing the nature of culture

• people don’t have a choice due to big companies and TNC’s taking over

• segregation of society due to no common culture to relate to

What are benefits of culture due to globalisation?

• global culture will mean people feel they fit in more

• TNC’s adapt their culture to different areas (glocalisation)

• spread of new and different cultures inspire new ways of thinking

• easier to communicate globally

• global culture would promote equality, freedom of expression and reduced discrimination