Globalisation
A long standing process which connects different parts of the world and involves the widening and deepening of global connections, interdependence & flows (commodities, capital, information, migrants, tourists and culture).
Wave 1
- Limited technology (steam engine, electricity, etc)
- Political leadership (GB is economic leader)
- Limited trade
Wave 2
- Gradual development in commerce (reduced tariffs)
- Political leadership change (USA is economic leader)
- Technology increase (planes, TVs, etc)
Wave 3
- Trade increase (large scale air cargo increase)
- Technology increase (mobiles, internet, etc)
- More political leaders (e.g. USA, EU, China, India)
- Commerce increase (more free trade)
Reasons for globalisation
- transport increase
- containerisation
- technology increase
- multinational companies increase
- trading blocs increase
- mobility of labour increase
- mobility of capital increase
- global media increase
- reduced tariff barriers
GATT
“General Agreement on Tariffs&Trade”
Now the WTO
Was implemented to further regulate the world trade to aid in the economic recovery following the war.
Main objective: To reduce the barriers of international trade through the reduction of tariffs, quotas & subsidies.
WTO
“World Trade Organisation”
Was known as GATT
Main objective: it’s an intergovernmental organisation which regulates international trade / deals with the rules of trade between nations.
TNCs
“Transnational Corporations”
Seen as the key agents of globalisation
Used to denote firms operating across, rather than in multiple nation states
Main objective: it’s any corporation that operates in more than one country at a time
Issues with globalisation
- growing wealth inequalities
- excessive power of tncs
Nation states (+example)
A type of state that joins the political entity of a state to the cultural entity of a nation, from which it aims to derive its political legitimacy to rule and potentially its status as a sovereign state.
Example- China
- TNCs choose china due to low labour costs, large market, relaxed laws of inward investment
- China want TNCs for employment (growing pop.), transfer of technology, global links, investment
SEZs
“Special Economic Zones”
An area in which business and trade laws are different from the rest of the country. They’re located within a country’s national borders, and their aims include: increased trade, increased investment, job creation and effective administration.
AT Kearney Index
Global cities index that ranks 125 cities according to 27 metrics across 5 dimensions: business activity, human capital, information exchange, cultural experience, and political engagement
Why has trade increased
- Reduced tariffs & trade barriers
- Increased technology
- containerisation (making trading transport easier)
- Increased transport (planes, large cargo ships now are faster than old steam engines)
2 reason answer= containerisation & aeroplanes
“Switched off”
Term used to describe areas which are less developed (such as Africa), which have less trade as they have no money to grow crops etc so have nothing to trade in return. Therefore the benefits of trading from globalisation miss these areas, so they become isolated and therefore “switched off”
