1
Q
What does globalisation involve:
A
Widening (new links between places greater distances apart) & deepening (more people connect with far away places)
- global connections
- interdependence
- flows (commodities, capital, info, migrants, tourists)
2
Q
TNCs
A
Firms operating in more than 1 country
Transnational corporations
3
Q
Positives effects of globalisation
A
- competition between big companies (lowers consumer prices, better quality goods/services, new ideas)
- foreign talent (football players) (migrants get a chance, more competitive, better players)
- better tech (connect & communicate with part of world easily)
- specialisation & division of labour between countries (more efficient & productive)
- goods can be transported anywhere around the world (online shopping)
4
Q
Negative effects of globalisation
A
- greater divide / gap between wealthy and poor
- resources channelled to particular parts of the world = inequality
- foreign competition drives smaller companies out of the market
- countries become inner-connected = increased dependency on other countries = economies more vulnerable
- trade wars between countries, political tension (China & USA)
5
Q
Positives of economic or political organisations (IMF WTO/World Bank)
A
Contributed to globalisation through
- promotion of free trade policies & FDI
Positives:
- country can invest in healthcare, education
- can recover economy, attract FDI
- privatising loss-making companies = less gov money invested, more to spend on country
- devalued rupee = exports become cheaper & more competitive to foreign buyers
6
Q
FDI (foreign direct investment)
A
= ownership of a business in 1 country by an organisation based in another
7
Q
Key players in the acceleration of globalisation (economic liberalisation)
A
- national governments
- EU (European union)
- TNCs
- international political and economic organisations (WTO, IMF, World Bank)
8
Q
How have national governments encouraged globalisation
A
- promote free trade blocs
More customers/imports/exports = increased flows between countries (goods, people, money, ideas)
Eg. EU, ASEAN - policies (free market liberalisation, privatisation, encouraging business start ups)
- invest in transport infrastructure (railways, airports)
- less visa/travel requirements
9
Q
What policies by the national gov encourage/accelerate globalisation?
A
- free market liberalisation (gov removed price controls, encouraging local & national competition)
- privatisation of nationalised industries (encourages new companies to compete)
- encouraging startup businesses (SEZ, encourage TNC investment)
10
Q
Positives for TNCs being part of a trade bloc
A
- bigger market (cheaper to source materials)
- firms merge together (lower costs, higher profits, more investment)
- protected from foreign competition outside of trade bloc (customers buy more locally)
- influence global trade (non-members seek to invest to open access to markets in trade bloc)
- leads to specialisation within industries (more efficient production & trade)
11
Q
Negatives for TNCs being part of a trade bloc
A
- have to join treaties (climate change)
- increased interdependence = economic problems in 1 country heavily affects others
- have to comprise (compete with foreign companies, lower prices = less profit)
12
Q
What has contributed to the spread of globalisation into new global regions
A
- special economic zones (SEZ)
- government subsidies (to aid unprofitable businesses, incentives eg. Electric cars)
- attitude to FDI (TNCs)
13
Q
How do nation states drive globalisation
A
- gov subsidies increase business success & profit
- gov accelerates trade through creating SEZ = attracts FDI and develops supply chains
- gov welfare spending & investment in transport infrastructure = better trade, attracts workers
- provide leadership & political stability which attracts FDI
14
Q
why don’t national states drive globalisation
A
- trade blocs (WTO) allow easier trade without tariffs = more flows
- physical geography (location) & natural resources can attract TNCs & workers (near coast, capital city)
- successful local companies attract foreign TNCs
15
Q
Forms of FDI
A
- Offshoring: the transfer of all/part of the production of goods/services to another country with the intention to re-import them to the home country
- Outsourcing: production of a good/service through a contract from an outside supplier (training of workers & partnership)
- Privatisation: government owned business, operation, or property becomes owned by a private, non-government party
- Foreign mergers: combination of 2 or more companies to share resources in order to achieve common objectives
- Foreign acquisition: acquire(buy) businesses that already exist
- Transfer pricing: methods which determine the price for trading in goods/services between related companies
16
Q
What indicators & indices are used to measure the degree of globalisation
A
- AT Kearney index
- KOF index
17
Q
AT Kearney index
A
- US management consultancy
- only 64 countries
Measures:
- business activity
- human capital
- info exchange
- cultural experience
- political engagement
- personal contact
18
Q
KOF index
A
- measured since 1970
- 158 countries
Judges how well countries are socially, politically, economically linked to each other - tourism
- communication
- trade
- FDI & socio political processes
19
Q
Role of TNCs in globalisation
A
Contribute to its spread
- global production networks
- globalisation
- development of new markets (new supply chains = increased imports/exports (trade))
Take advantage of of economic liberalisation
- outsourcing
- offshoring
20
Q
Glocalisation
A
Adapt goods & services to appeal to local customers (religion, laws, local interest)
Through:
- Local regulations / restrictions
- trade blocs (source & sell locally, reduces import tariffs)
21
Q
Economic liberalisation
A
The lessening of gov regulations & restrictions in an economy in exchange for greater participation by private entities, boosting economic growth & efficiency
22
Q
Outsourcing
A
Transferring work to another company (avoid cost of repeating something another company is doing)
23
Q
Offshoring
A
Move operations to another country (cheap labour in china, India, legal child labour)
24
Q
Reasons why some locations remain largely ‘switched off’ from globalisation
A
- land-locked (less trade, lack of communication, reliance on neighbouring countries)
- political corruption & instability (gov) (AQMB)
- low literacy rates (weak education systems)
- lack of transport infrastructure (less trade & workers)
- lack of TNC interest / FDI (no market, lack of skilled workers & resources)
25
What is happening in manufacturing that is not good for the western world
The movement of the global economic centre of gravity to Asia via the global shift of manufacturing (China/Bangladesh)
26
What leads to changes in the built environment
- outsourcing of services (India, Dhaka)
- global shift of manufacturing (China/Bangladesh)
- cultural erosion (loss of language, food, music, traditions)
27
Benefits of changes in the built environment (outsourcing)
- infrastructure investment
- waged work
- poverty reduction
- education & training
28
Costs of changing the built environment (outsourcing)
- loss of productive land
- unplanned settlements
- environmental & resource pressure
29
What environment problems have some communities in developing countries experienced:
- air & water pollution
- land degradation
- over-exploitation of resources
- loss of biodiversity
30
What are the moral issues with outsourcing (Dhaka, Bangladesh)
- building collapsed (no building regulations)
- many killed / trapped
- overcrowded workplace
- ignore safety conditions
- exploited workers didn’t contest (too vulnerable)
- little gov intervention (corruption, lack of budget / time)
31
Benefits from global shift of manufacturing to Asia
- 750 companies on stock exchange
- Asian highway network
- British council helps schools teach uk qualifications (improves literacy rates)
- millions have migrated for work opportunities in secondary sector
- less people living on $1.25 per day
32
Costs of global shift of manufacturing to Asia (social/environmental)
Environmental:
- 100,000 hectares of agricultural land lost per year due to development projects
- slum settlements expand quickly
- rivers filled by sand & garbage causes flooding
- inadequate infrastructure (traffic congestion rises)
- clothing factories operate without environmental clearance certificates (wastewater, exploitation of resources, high levels of pollution)
- slums cause health issues (cholera disease, air pollution, poor sanitation)
Social:
- child labour taking place on large scale
- rapid rate of urbanisation = poverty / unemployment / poor public health care / overcrowding
33
Deindustrialised regions
Regions moving away from secondary sector, decline of manufacturing in developed countries
34
Deindustrialised region example
Scunthorpe, England
- 2,200 jobs lost
- future ghost town ?
- 90% decline in UK iron / steel
35
Social / environmental problems deindustrialised regions face as a result of economic restructuring
Social:
- dereliction (areas of city abandoned)
- depopulation
- crime
- high unemployment
Environmental:
- contamination
36
Spiral of decline (deindustrialised regions)
- old factories close
- land becomes derelict
- unemployment, jobs lost
- people leave inner city (depopulation)
- fewer services needed, shops / schools close
- more jobs lost as incomes reduce
- counter-urbanisation (people leave)
- elderly or low-income groups stay
- area becomes more run down as lack of investment
- more crime & vandalism (lack of hope, self-esteem)
- reduced quality of life (mental health issues)
37
Megacity
City with a total population of more than 10 million people
38
What is responsible for the growth of Megacities (rapid urban growth)
- Rural-Urban Migration
- natural increase causes city growth
- transport / tech improvements aid migration
39
Push & pull factors of rural-urban migration
Push factors:
- rural overpopulation
- disasters
- more crime
Pull factors:
- jobs
- good healthcare
- good education
40
Example of rapid urban growth (Karachi, Pakistan)
- capital of Pakistan (developing country)
- 6th most populated city in world
- primate city (dominant)
41
Karachi, Pakistan impacts of rural urban growth (economic & social)
Economic:
- formal economy estimated to be worth $113 bn in 2014
- generates 20% of Pakistan’s GDP
- centre of trade & commerce attracting TNCs
- higher income levels
Social:
- murder rate decreased 75%
- BUT 90% young people dont see opportunities here
- militant groups controlling city
42
What has international migration increasing caused
- deepening interdependence between regions (elite Russian oligarchs to London)
- mass low wage economic migration (low wage European migrants to London)
43
economic benefits and costs of migration for host location (London)
+ filled labour & skill shortages (more taxpaying workers)
+ migrants contribute to economy as consumers
+ some migrants are entrepreneurs = create new businesses = new jobs
+ EU migrants willing to work for low wages, long hours, dangerous conditions (fills jobs locals reluctant to do)
+ attracts ‘international elite’ (bankers, programmers, health professionals) = larger, more diverse economy
- rent increases = unaffordable for locals
- migration can increase unemployment as not enough jobs for no of people
- increased informal sector (underground economy)
- migrants send remittances back to home country (no increased consumerism)
44
social benefits and costs of migration for host location (London)
+ create/expand bridge header communities = more cultural diversity
+ migrants usually have children = offset / support ageing population
+ more taxpayers contributing to NHS & education
- social tensions arise as some citizens believe migration = loss of jobs & housing
- local shortages of primary school places
- cultural changes might upset locals
- need for extra health services, education, housing in concentrated areas
45
Political benefits and costs of migration for host location (London)
+ create alliances with countries (Russia, Europe)
+ more taxpayers = provide gov with money to spend on welfare & reinvest in country
- political parties change policies to address public concerns (reduce migration), tension between parties
46
environmental benefits & costs of migration for host country (London)
+ EU low wage migrants have less disposable income = tend to use less energy (produce less waste)
- more transport congestion = more pollution = breathing difficulties = lower quality of life
47
Economic benefits and costs of migration for source location (Russia, EU)
+ reduction of workforce balanced by remittances, contribute to national earnings (EU)
+ reduced unemployment & overcrowding in sectors
+ less consumers in market = reduced prices, lower wage locals benefit
+ fewer workers so wages rise & new job opportunities for other groups (women)
- skills shortages in key areas of economy (doctors, teachers = less innovation)
- reduced economic growth as consumption falls
48
Social benefits and costs of migration for source location (Russia / EU)
+ returning migrants bring professional, social, political experience (children)
+ hospitals & schools less overcrowded = better quality of life
- demographic imbalance as young people migrate (ageing population)
- depopulation may lead to dereliction & decline of urban environments
- closure of urban services & entertainment as low population to sustain
- loss of culture / community
49
Political benefits and costs of immigration for source location (Russia / EU)
+ reduced pressure on welfare spending
+ some gov spending costs (education) transferred to host region
- loss of key workers at gov expense (doctors, teachers)
- loss of tax revenue = reduced gov spending on welfare
50
Environment benefits and costs of immigration for source location (Russia / EU)
+ less jobs = less manufacturing = less waste & pollution = between quality of life
- depopulation may lead to dereliction = environmental not cared for
51
Cultural erosion
| Parts of cultural erosion
Loss of
- language
- traditional food
- music
- clothes
- social relations
Cultural diffusion = spread of beliefs & social activities of aspects of culture to different nationalities etc (olympics)
Cultural dilution / erosion = local cultures become less pronounced as they are influenced by foreign cultures
52
What has cultural erosion resulted in
- changes to built & natural environment
- de-valuing local & larger-scale ecosystems
Eg. Loss of tribal lifestyles in Papua New Guinea
53
Role of globalisation & TNCs in cultural erosion
- TNCs bring new products / services / western ideas
- joining up of global production chains = loss of habits
- expansion of international capitalism & emergence of global culture
- Economic growth becomes primary goal & social value lost
54
Why has opposition to globalisation occurred and from who
concern about
- cultural impacts
- economic & environment exploitation
From:
- Pro and anti-globalisation groups
- Environmental movements
55
Reasons for & against concern of cultural impacts
- younger members exposed to new ideas(social media), created tension with elders
- political clashes (opposing views)
+ might get hybrid cultural communities
+ removing communities might preserve culture
+ some cultures can resist westernisation
56
Amount of tension / opposition from cultural impacts can depend on:
- access to globalisation vs amount of censorship (suppression)
- time of exposure to globalisation
- age structure of community
- if alternative views are embraced
- might be other cultures, not westernisation (Bollywood, Anime, Buddhism)
57
The cultural continuum (differing responses to cultural diversity & change)
Hybridism / melting pot: adopts & absorbs new migrant values (positive view of American culture)
Pluralism: Eu nations tolerate equal rights for all migrants to practice their religious / cultural beliefs
‘Citizenship’ testing: UK rules for migrants becoming stricter in reaction to popular concerns over immigration
Assimilation: belief that minor traits should disappear as immigrants adopt host values
Internet censorship: preventing citizens from learning other global viewpoints using online sources (china)
Religious intolerance: Lower levels of religious freedom for minority groups (Iran)
Closed door to migration: stopping any immigration for fears of cultural dilution (cambodia)
58
What does the Gini Coefficient measure
trends in widening income inequality (globally & nationally)
59
What does trends in widening income inequality suggest
Globalisation has created winner and losers for
- people
- physical environments
Between & within all countries
60
Why has globalisation created inequalities (winners & losers)
- some people take advantage of free trade, leads to increased salaries & profits (winner)
- some people lose jobs with shifting patterns of production (change of sectors away from primary) (loser)
- investment from TNCs creates cheap labour for locals & high tech jobs in quaternary sector for more educated = income gap
61
Relationship between HDI and Gini coefficient
HDI = human development index
Gini coeffict = level of inequality
High HDI = low Gini (more developed = less inequality)
Low HDI = high Gini (less developed = more inequality)
As more developed countries have less unemployment and more jobs in the formal sector with minimum wages and policies to stop low wages and taxes
62
Migrant diasporas
Communities of migrants that have arrived in new countries
63
What has created culturally mixed societies & thriving diasporas in some locations
But also tension elsewhere (extremism)
- open borders (enables free movement of ppl between countries with few / no restrictions)
- deregulation (removing gov legislation & laws in particular market to encourage competition)
- encouragement of FDI
64
Extremism
Viewpoints that dont acknowledge alternatives, can result in aggressive behaviour
Eg. rise of extremism in Europe
65
Causes of social / political tension in Germany
- aim for 800,000 refugees in 2015
- different states have different acceptance quotes expected by federal gov
- large migrant diaspora (1 million post 2015)
66
Social tension in Germany as a result of lots of migration
Extremists:
- more than 13,000 extremist crimes in 2015
- personal protection spending growing (knives) due to increased crime (labelling all immigrants as criminals)
- concern about influence of different sects (different religious beliefs = racism, segregation within communities)
- protests
67
Political tension in Germany as a result of lots of migration
Extreme right wing parties (AfD - alternative for Germany)
- concerns about social decline / cultural alienation
- opposes European Union & immigration
- 3rd largest party in 2017
- factions of racist, Islamiphobic, antisemitic, xenophobic tendencies
- caused ‘political earthquake’ - protests, tension between other political parties
- growth of nationalist groups (anti-EU)
- anti-globalisation groups
- environmental action groups (green peace)
68
Why is radicalisation an understanding response
- some citizen may feel unsafe (women, sexual abuse = buy protective weapons)
- new migrants with some skills create competition for jobs (loss of income for vulnerable workers)
- immigration may spiral out of control, sudden cultural, economic, political changes = confusion & lots of opposing views
69
Why is radicalisation not an understanding response
- cant generalise all immigrants as criminals due to actions of a few (segregation, discrimination)
- religious intolerance (minority groups may have little freedom, unfair)
- can lead to unneeded social & political tension (dangerous)
70
What do some groups do to retain their cultural identity within countries
Example:
- retain control of culture & physical resources
Eg. First Nations in Canada (indigenous people impacted by economic & social & environmental liberalisation in Canada - free movement)
71
First Nations, Canada culture:
- aboriginal people of Canada
- 634 recognised communities
- spans 1000 years
- run their own schools, health boards, towns
Priority = protection of rights & culture
72
Negatives of stopping development to retain cultural identity
- stunts economic growth
- limited opportunity
- poorer education for young people
- degraded environment
- health problems, ageing population
73
What do local groups & NGOs promote as a response to globalisation
local sourcing / localism (transition towns / coffee sourcing) by increasing sustainability
= support:
- local production & consumption of goods
- local gov control
- production of local culture & history
74
Ethical concerns created by globalisation
- industrial / transport companies have high CO2 emissions & create pollution
- exploitation of workers
- corruption endemic in some countries (weaknesses in organisations / gov)
- sub-contracting brings weak governance (sweatshirt shops)
- factories based in developing countries (offshoring) have less stringent health & safety & environmental laws
75
What does recycling do
Definition
- manage resource consumption
- reduce ecological footprints (electricity consumption, greenhouse gas production)
= manufactured goods are refused instead of being sent to landfill
76
The circular economy
- another approach to reducing ecological footprint
- shifts cost of production / waste from consumers to manufacturers involved in supply chain
Eg. Leasing = ppl borrow but dont own products
77
Pros & cons of circular economy
+ provide incentives for care, consumers take responsibility
+ build using durable materials / replaceable parts
+ reduce emissions (lower tax)
+ use cheaper materials / recycle parts = reduces cost & increases market
+ encourage customers to upgrade & pass cards on
- mechanics might lost jobs / need to retrain
- might only work for richer people
78
Local plans / authorities / NGOs in UK that encourage recycling
Local Agenda 21:
- aim for sustainable development
- established in 1992
- banned free plastic bags, encouraged reuse of bags when shopping
Keep Britain Tidy
- NGO to reduce litter, improve local places & prevent waste
- founded 1960
Globalisation
flashcards
Decks in class (2)
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