Globalisation EQ1

Question 1

what does globalisation mean?

Answer 1

used to describe ways in which places and people are more connected.

Question 2

what is lengthening?

Answer 2

Connections between people and places with products sourced from further away.

Question 3

what is deepening?

Answer 3

Connections with sense we’re connected to other people in terms of every aspect of our lives such as music, food, and products we consume.

Question 4

why is globalisation faster now?

Answer 4

at no ther time in our lives have we been able to get things quicker from jet aircraft to zoom containerships.

Question 5

what are some pros of globalisation?

Answer 5

• efficiencies and opportunities open markets create.
• businesses communicate easily with partners, suppliers, customers, manage better supplies, inventories, distribution network.
• local producers sell products in distant markets with same ease and speed as home country.

Question 6

what are some cons of globalisation?

Answer 6

• new risks and uncertainties brought about by the high degree of integration of domestic and local markets.
• the intesification of competition, high degree of imitation, price and profit swings, and business and product destruction.

Question 7

what is the ugly side of globalisation?

Answer 7

• dehumanising practices of mass production
• destruction of the environment
• the change in “free will”?

Question 8

give 4 key elements of globalisation?

Answer 8

1. interdependence-two or more countries rely on eachother
2. trade-growth of international trade
3. flows-movement of factors between countries
4. culture-exchange of ideas, music, food between countries

Question 9

give 5 examples of flows

Answer 9

.capital
.commodities
.information
.tourists
.migrants

Question 10

what is the flow of capital?

Answer 10

flow of money between countries e.g. stock markets (overall around $6.5 trillion a day)

Question 11

what is the flow of commodities?

Answer 11

flow of raw material, food, and minerals that flow between countries including manufactured goods (around $30 trillion a year)

Question 12

what is the flow of information?

Answer 12

the internet has brought real time communication; social networks have grown e.g. twitter. on demand TV, Netflix has nearly 200 million subscribers.

Question 13

what is the flow of tourists?

Answer 13

increased air travel, budget airlines mean people are seeing more places, people in emerging countries are now travelling abroad. (in China alone, 150 million outbound trips occured in 2018)

Question 14

what is the flow of migrants?

Answer 14

movement of people has grown in recent years. Quatar encourages economic migrants, and the combined number of worldwide migrants was around 270 million in 2019 with $625 billion sent home in remittances.

Question 15

what is the shrinking world effect?

Answer 15

despite the Earth’s physical size remaining constant, advancements in transport and technology make distant places feel much closer and more accessible.

Question 16

what caused the shrinking world effect?

Answer 16

containerisation-the protocol of a uniform container size that can be placed on all ships and transported all over the world.
jet aircraft-Jet aircraft were first used for military purposes. But after the Second World War, they were used for passengers which started commercial airlines.

Question 17

what is the time-space compression?

Answer 17

as we get more advanced, we can travel to places quicker making the world feel ‘smaller.’

Question 18

what is the time-space compression a result of?

Answer 18

ICT-telephones, broadband and fibre optics, GIS and GPS, and social networking.
Mobile phones-revolutionised banking, ideal in developing countries due to lack of infrastructure, M-Pesa system is a money tranfer service helpful for getting out of rural poverty.

Question 19

what is the World Trade Organisation? (WTO)

Answer 19

it was established in 1945 to promote international economic co-operation in trade. based in geneva and deals with the rules of global trade. it aims to ease trade and remove barriers to trade whilst negociating trade agreements between countries and make sure countries stick to them.

Question 20

what are the key points of the mini case study: WTO in action?

Answer 20

.in 1995, Pakistan joined the WTO
.it had to open its waters to international fishing which created competition.
.TNC’s began to move in. Huge boats from India fished their waters, leaving them with little left to fish and poverty grew within the fishing community.
.2013 Charity ActionAid took up their plight and that fish stock were dangerously low.
.by joining WTO Pakistan fishermen were now worse off and many gave up fishing.

Question 21

what is the International Monetary Fund? (IMF)

Answer 21

designed to secure financial stability, facilitate international trade, reduce poverty, and promote high employment and sustainable economic growth.

Question 22

what is the World Bank? (WB)

Answer 22

an international financial institution that provides loans, grants, and technical assistance to developing countries to reduce poverty, foster sustainable economic growth, and fund infrastructure projects like schools and power grids.

Question 23

what are some cons of these 3 IGO’s?

Answer 23

. the 2008 global financial crash undermined the world economy - leading to countries and people being sceptical of financial advice from the IMF and WB.
. the changing world order means countries no longer need to rely on these IGO’s but can now go to BRICS e.g. China Development Bank.
. WTO rarely gets all members to agree on terms of trade and thus undermines its role.

Question 24

how have national governments helped accelerate the growth of TNC’s?

Answer 24

1. Free market liberalisation
2. Privatisarion
3. Encouraging business start ups

Question 25

explain free market liberalisation

Answer 25

economic liberalisation refers to a country "opening up" to the rest of the world with regards to trade, regulations, taxation, and other areas that generally affect business in the country.

Question 26

explain privatisation

Answer 26

the transfer of a business, industry, or service from public to private ownership and control. By privatising national companies, it allows for the growth of competition, removes the burden of costs for the govt and creates wealth.

Question 27

explain business start ups

Answer 27

governments can offer small business loans on lower interest rates, helpful resource programs, and give tax incentives.

Question 28

what is deregulation

Answer 28

the reduction or elimination of government power over a particular industry, usually enacted to try to boost economic growth.

Question 29

give some key factors of the European Union

Answer 29

- set up a single currency to strengthen economic and political integration, promote tradw, and increase stability - set up the common agricultural policy to adress post-ww2 food shortage - freedom of movement is important as it boosts economic growth, deepens political integration, and strengthens the EU's single market - only place with the free movement of people

Question 30

give some key factors of ASEAN

Answer 30

- free flows of goods - free flows of services - free flows of investment - free movement of skilled labour - free flows of capital

Question 31

give 3 reasons why some countries join trade blocks

Answer 31

- lower prices and more varied products - boost FDI, encourages companies to increase investment and create jobs in other member countries. - access to cheaper and more abundant capital

Question 32

give 3 negatives of trade blocks

Answer 32

- shutting down the domestic industry, increased competition creates winners and losers - loss of state sovereingty, the trade block makes decisions for all members - retaliation from non-member countries, likely to form new trade blocks to defend their positions

Question 33

what are the key points of China's open door policy?

Answer 33

- aimed to shift China's development strategy from self-sufficiency to active participation in the world market - China allowed companies to set up operations within the country - facilitated increased foreign trade , leading to rapid economic expansion - China established SEZ's with preferential policies to attract foreign investment - Contributed to China's emergence as a major player in the global economy. - it laid the foundation for China's subsequent economic reforms and growth

Question 34

what is the significance of an SEZ?

Answer 34

China, Indonesia, and India have all embraced markets as a means of development. All three have established SEZs which are industrial areas often near the coast. They have low tax rates, exemption from tariffs and export duties, this helps attract investment and TNCs

Question 35

give 3 points on Indonesia

Answer 35

- opened up their economy in the 1970's - world bank funded much deevelopment e.g. roads and power supplies - seen as more of a tax haven for sweatshop manufactoring

Question 36

give some points on India

Answer 36

- began to globalise in early 1990's due to financial reforms - Indian TNC's have grown rapidly - Bharti Airtel (mobile network) has a turnover of US$14 billion - until 2013 foreign TNCs could only set up in India if they went into partnership with local businesses - 90% of India's shops are still family owned

Question 37

how can we measure the level of globalisation within a country?

Answer 37

a measure of globalisation is about the strength and number of links it has with other countries and not how developed or wealthy it is

Question 38

what indicators does the KOF use?

Answer 38

- economic globalisation (cross boarder transactions) - social globalisation (cross boarder contats) - political globalisation (number of foreign embassies)

Question 39

what indicators does AT Kearney use?

Answer 39

- political engagement (participation in treaties) - technological connectivity (number of internet users) - personal contact (phone calls, travel etc) - economic integration (volumes of international trade/ FDI)

Question 40

how is each countries rank calculated using KOF?

Answer 40

scaled by significance agregated into one value for each one the index rankings represent the final average rank for all 3 interactions

Question 41

how is each countries rank calculated using AT Kearney?

Answer 41

the overall ranking is worked out using a complex points and weighting system for the 4 individual indicator rankings

Question 42

what are the issues with KOF?

Answer 42

social globalisation includes things like the number of Mc Donald's restaurants per capita, however, some countries may have other brands. trade in books is related to a countries level of literacy or disposable income. smaller countries seem to fare well suggesting issues with measurements - Switzerland number 1st and USA 23rd countries themselves provide data meaning it can be manipulated

Question 43

what are some other ways of measuring globalisation?

Answer 43

-membership of trade blocks - shows how it trades with over countries (ASEAN, EU) -membership of IGOs - shows ability to communicate and get involved in global issues (WB, IMF, WTO) -goods and flows; Trade flows; aircraft flows; human flows; e.g., migrants

Question 44

what are some mistakes when measuring globalisation?

Answer 44

how do you measure: wealth development lights

Question 45

what is a two speed world?

Answer 45

operates in terms of rich v poor, comparing those wealthy HICs and those LICs in terms of their connectedness. however, a two speed world often also exists within countries such as between Redcar and Mayfair in london. It is about the have and have nots often caused both directly and indirectly by globalisation.

Question 46

what are the factors that make a country switched off?

Answer 46

politically - on purpose, lacks political stability, high levels of corruption economically - lacks resources geographically - climate, topography socially - low educational levels

Question 47

explain why The Sub-Saharan Africa is geographically switched off

Answer 47

the Sahel region is considered one of the poorest on the planet, it lacks: - connections - investment - political stability - resources these countries are switched off regardless of whether they are rural or urban. the vast majority of the population rely on subsistence farming as well as the OECD and NGOs for relief. some farmers may grow for TNC's, but low wages create no spending power within the country

Question 48

explain why North Korea is politically switched off

Answer 48

it has been ruled for nearly 80yrs by the Kim Dynasty they follow a communist style system citizens have no access to the internet or social media there are no undersea data cables their relationship with China has worsened due to the accelerated nuclear development Russia has offered little monetary help since the collapse of the USSR global indicators tell a strange story the two countries share little in common

Question 49

what is a TNC?

Answer 49

a company that has headquaters in one country and operates in many others

Question 50

why do TNCs wish to spread themselves between countries?

Answer 50

TNCs aim to globally meet demand for their products they aim solely for increasing profit

Question 51

how do TNCs spread their 'wares' between countries?

Answer 51

they build factories, sell direct, or develop new products for their markets

Question 52

what countries do TNCs take advantage of?

Answer 52

countries who are weaker: economically politically socially

Question 53

how do TNCs take advantage of countries?

Answer 53

offshoring outsourcing glocalisation development of new markets

Question 54

what is offshoring?

Answer 54

when TNCs move part of their production process to other countries to reduce the cost of labour e.g., call centres

Question 55

what is outsourcing?

Answer 55

when TNCs contract another company to ptoduce their goods and services they need rather than do it for themselves

Question 56

what is glocalisation?

Answer 56

refers to changing the design of products to meet local taste or laws

Question 57

what is development of new markets?

Answer 57

helping to switch on new places

Question 58

give some examples of glocalisation

Answer 58

Mc Donalds makes their packaging red in China KFC makes spicier chicken for the Indian market

Question 59

why do TNCs use glocalisation?

Answer 59

local taste preferences brand loyalty religions wages superstitions