globalisation=
a process by which national economies and cultures have become increasingly integrated through the global network of trade, communication and transport
the development of technology, new systems and relationships-FACTOR AFFECTING GLOBALISATION
systems=include ways of working and methods of organisation that allows a particular function to be carried out. new systems are made to made the flows of services transport etc easier to cross national boundaries
technology allows people to access information and communicate with people
financial systems-factors affecting globalisation
- the global financial systems accelerates globalisation as it makes the world more connected
- high speed electronic trading systems means financial transactions can be completed quickly
- people buy and sell shares/stocks from global corporations
- multinational corporations invest their profits for more interest so billions of dollars are put into systems
- countries can borrow and lend to other countries which develops relationships between them
- deregulation allows the relaxing by governments of barriers to movements of finance-easier to buy and sell shares
transport systems- factors affecting globalisation
-products and commodities can be shipped quicker and in larger quantities due to:
-increased size of aircrafts, low cost airlines, container, high speed railways
containerisation= using large shipping containers to transport goods. it makes global transportation cheaper as less trips are needed to transport the same amount of products
security systems- factors affecting globalisation
- due to the world being globalised countries face threats from other countries
- theres now stricter regulations when entering a country and transporting goods
- international customs control flows in and out to ensure security (x ray scanners in airports)
- cybersecurity is a global concern- technologies ensure cyber attacks can be traced
- global systems are put in place to limit disagreements and wars to ensure security within countries- like united nations security council which aims to diffuse agreements
communication systems- factors affecting globalisation
- ability to communicate globally has allows info and services to accelerate
- satellites and fibre optic communication enabled the growth of internet and mobiles
- services can be accessed via phones
- relationships can be maintained which causes global connections and increase flow of labour as people are more likely to move
management and information systems-factors affecting globalisation
-globalisation has been accelerated by the way companies manage flow
ECONOMIES OF SCALE=concept of increasing profit by producing a larger amount of products as to manufacturing costs is lowered-large amount of products can be shipped so cost is lowered
GLOBAL SUPPLY CHAINS=organised management of product flows- companies can have different stages of production in different countries from communication and transport- which minimised costs
outsourcing(management systems)=
hiring other companies to complete tasks that companies dont need to do themselves like call centres- this saves money especially when outsourcing to low income countries
offshoring (management systems)=
is relocating a company process abroad- due to communication systems and easier transport it can help reduce costs
trade agreements- factors affecting globalisation
- countries trade different products to different countries
- trade agreements has accelerated trade as its less expensive and easier
- trading products is expensive due to controls and restrictions put in place such as tariffs(taxes) and no tariff barriers like quotas
trade agreements help lower restrictions to reduce costs- which is managed by WTO
positives and negatives of trade agreements
POSITIVES- improve peace and reduce conflict, freedom of trade movement, help members develop their economies
NEGATIVES- some loose financial control to a central authority like a bank
some sectors are damaged as they have to share resources- fishing grounds shared
