Reasons for Increased Globalisation

Trade liberalisation - removal/reduction of trade barriers between countries

Advantages:

• Goods can be acquired cheaper

• Increase in market size

Disadvantages:

• Infant industries cannot compete

• Dumping - selling excess products at unfairly low prices

• Political change

• Reduced cost of infrastructure

• Increased significance of TNCs - increased pressure for countries to engage in free trade (no protectionist measures)

• Increased FDI (investment flows) - allows businesses to establish themselves in a country where they may face trade barriers

• Migration

• Growth of global labour force - more income which boosts global demand

• Structural change - offshoring

Offshoring - sending business practices overseas