4.1.3 Globalisation

Question 1

Globalisation

Answer 1

the increasing integration and cooperation between countries and the growth of international trade

Question 2

8 reasons why there has been an increase in globalisation

Answer 2

• Reduction in trade barriers/trade liberalisation
• Political change
  -Reduced costs of transports and communication
  -Increased MNCS- more global companies
  -Migration
• Growth of the global labour force + increasing population

-Structural change
-Increased FDI - firms are investing more in foreign countries

Question 3

1) Trade liberalisation

Answer 3

the process by which international trade is made easier through relaxation of trade barriers e.g tarrifs and quotas

Question 4

Free trade agreements

Answer 4

Encourages trade between countries
- no restrictions between buying and selling

Question 5

What is a result of free trade/trade liberalisation

• This helps to main which process

Answer 5

the volume of international trade increases and businesses can now sell goods and services in new foreign markets without penalties

• helps to maintain the process of globalisation

Question 6

The world trade organisation (WTO) is often used to help negotiate what

Answer 6

WTO is often used to help negotiate trade agreements and promote trade liberalisation

Question 7

Advantages of trade liberalisation - 4

Answer 7

• Any raw materials that a firm imports will become cheaper (due to removal of barriers e.g tarrifs) - this will lower a firms costs, which could make it more competitive as it can reduce prices
• exporting goods becomes easier & cheaper - now more markets to expand to
• Consumers benefit from increased choice from products all around the world - can find better quality
• Consumers can also benefit from lower prices. Increased competition from firms in different countries will mean that products are cheaper from consumers as firms compete for sales

Question 8

Disadvantages of trade liberalisation - 2

Answer 8

• removal of trade barriers will reduce costs of imports. As a result domestic businesses can be forced out by the increased imports if they are not competitive, which can increase unemployment
• some feel that trade liberalisation is leading to a removal of national cultures

Question 9

How does political change increase globalisation?

Answer 9

Restrictions to international trade put in place by one government might be REMOVED if the political system changes to one that supports trade liberalisation

• Known as political reform
• this may lead to more trade between countries which in turn increases GLOBALISATION

Question 10

An example of political change leading to an increase in globalisation & trade

Answer 10

eg the end of communist rule in the Soviet Union in 1991 - the soviet bloc was dissolved and the various countries opened their economies and began trading with the rest of the world. Some joined the EU.

Question 11

Reductions in what costs have increased globalisation

Answer 11

Reductions in transportation and communication costs

Question 12

How has transport costs reduced

Answer 12

cargo ships and containerisation ( where goods are shipped in cargo containers) means that costs are now reduced.More goods can be loaded and its more quicker

Overall increases globalisation

Question 13

Reductions in communication & globalisation

Answer 13

Growth of internet/tech means information can be sent across the world more easily and cheaply.

• Businesses can communicate with customers/suppliers all over the world.
• consumers can gather info about goods and buy them from across the globe.

Overall globalisation is increased.

Question 14

How has MNCs (Multinational companies) increased globalisation

Answer 14

• They developed significant business interests e.g investments & operations across the globe.
• They have brought familiar products/services to countries across the globe e.g Toyota, Volkswagen

Question 15

Migration

Answer 15

the movement of people who aim to set up residence in another country

Question 16

How does migration increase globalisation

Answer 16

Increases globalisation because ppl import their cultures & goods which creates demand for products in the place they move to

e.g in the uk there is many specialist polish shops that cater for polish immigrants

Question 17

How does migration benefit businesses

Answer 17

• Provides businesses with able-bodied workers who can in fact have greater skillsets
• may also provide businesses with low-cost labour which can give them a competitive edge as they can sell products for cheaper

Question 18

Growth of global labour force + increasing population

Answer 18

Read notes ( blurt it )