What is globalization?
A process where barriers to trade and investment decline, perceived distance shrinks due to technology, cultures become more similar, and national economies merge into an interdependent global system.
What does “interdependent” mean in globalization?
Countries rely on each other for resources—like India providing skilled IT labor and the U.S. providing capital investment.
What does “integration” mean in globalization?
The connection between countries where one provides resources and the other provides investment—like the U.S. investing in India’s IT sector.
What is the globalization of markets?
The merging of separate national markets into one big global marketplace.
Give examples of globalization of markets.
Citigroup credit cards, Coca-Cola, PepsiCo, Sony video games, McDonald’s hamburgers.
Why do companies globalize production?
To lower costs and improve quality by using resources from different countries.
What is the globalization of production?
Sourcing goods and services worldwide to take advantage of cost and quality differences in factors of production like labor, energy, and capital.
Why do we need global institutions?
To manage, regulate, and monitor the global marketplace and promote multinational treaties.
Give an example of a global institution.
The General Agreement on Tariffs and Trade (GATT), The world bank, the world trade organization, the G20
What are the main drivers of globalization?
- Declining trade and investment barriers
- Technological change
- Transportation technology
What was the effect of governments giving subsidies to local industries?
It protected local industries from foreign competition.
How do trade and investment barriers affect globalization?
High tariffs protect domestic industries but make foreign goods more expensive, limiting competition; lowering tariffs encourages trade.
How did technology make globalization possible?
It made global trade faster and easier through the internet, the web, and better transportation.
How did the internet and World Wide Web impact globalization?
They made it easier for businesses to connect and expand globally, regardless of size.
How did transportation technology help globalization?
Jet travel and containerization reduced travel and shipping time and costs, shrinking the world.
What are some positive effects of globalization?
- Creates jobs and supports local economies
Makes products cheaper
Encourages international cooperation and reduces war likelihood
Increases global interdependence through shared goods
What are some negative effects of globalization
It separates people from their culture, exposes villages to society in the world, tell people to forget their culture and background.
