What is globalisation
What are the main flows in globalisation
• Capital (FDI, stocks)
• Labour (migration)
• Products (manufactured goods)
• Services (footloose industries)
• Information (media, internet)
What is meant by the shrinking world
• Time–space compression
• Improvements in transport & ICT make distances feel shorter
• Faster communication and global mobility
How did 19th–20th century transport accelerate globalisation?
• Steam power → faster global shipping
• Jet aircraft → fast travel & freight
• Containerisation → cheaper global trade
Key ICT developments accelerating globalisation?
• Internet & fibre optics
• Mobile phones/smartphones
• Social media
• GPS tracking
IMSG
Why is containerisation important?
• 200+ million container movements yearly
• Standardised, cheap, fast global transport
• Enables modern global supply chains
How does the IMF encourage globalisation?
Evaluation of their role: strict conditions and governments borrowing which may result in the government reducing spending on healthcare, education etc
What does the World Bank do?
Evaluation of their role: distributed US 65 billion in loans and grants, imposes strict conditions on loans and grants, controversial all world bank presidents have been US citizens
What is the role of the WTO?
Evaluation of their role: failed to stop the USA and the EU from subsidising their own food producers which hinders farmers in LDCs
Benefits of trade blocs?
• Larger markets for businesses
• More reliable trade routes
• Creates positive multiplier effects
Disadvantages of trade blocs?
• Excludes countries outside the bloc
• Harms non-member industries
• Can create uneven advantages
How do governments promote globalisation?
• Free-market liberalisation
• Privatisation
• Encouraging start-ups
• FDI incentives
What is free-market liberalisation?
• Reducing government intervention
• Deregulating finance sectors
• Encourages foreign investment
What is privatisation?
• Selling state-owned industries to private companies
• Raises revenue, encourages efficiency
• Criticised for lower service quality
What is FDI and why is it encouraged?
• Investment by TNCs into a country
• Creates jobs, boosts tax revenue
• May lead to foreign dominance
What does the KOF Index measure?
• Political globalisation
• Economic globalisation
• Social globalisation
• Score from 1–100
What does the AT Kearney Index measure?
What are simple measures of development?
• GNI, GDP, PPP, income per capita
• Easy comparisons but hide inequality
Why are TNCs significant in globalisation?
• Operate across many countries
• Control global supply chains
• Produce jobs, investment, cultural flows
OCP
How do TNCs create global links?
• FDI → factories, mergers, acquisitions
• Offshoring & outsourcing
• Vertical & horizontal integration
What risks do TNCs pose?
• Worker exploitation
• Environmental damage
• Vulnerability to supply chain shocks
What are switched-off places?
Places that remain relatively switched off from the global network
Often politically or geographically isolated
Strong flows of trade and investment with other countries are absent in these countries
Environmental factors limiting globalisation?
• Landlocked status
• Harsh climates
• Poor resources
Political & economic reasons for being switched off?
• Corruption, conflict, censorship
• Weak markets, poor infrastructure