4.1 Flashcards
(13 cards)
Emerging vs developed countries
Emerging
-china,India and Africa
-growing gdp
-poverty
-poor infrastructure
Developed
-UK
-smaller gdp growth
-higher income
-low levels of low cost manufacturing.
China- high pop, high wf, but one child policy means decline in wf. - invested in infrastructure, high in manufacturing at low wages.
India- high pop growth, poverty and poor infrastructure.
Africa- high pop, rich in natural resources such as coco, coffee and oil.
What are the emerging economic powers of countries
BRICS Brazil Russia India china and South Africa they have a growing middle class which means disposable income increase, better for international firms selling in these countries
Implications of growth for people and businesses
People - reduced unemployment as more demand,
Businesses - larger profit as entering new market and customers
Indicators of growth
GDP
literacy
Health
HDI
Specialisation and competitive advantage
Focus on one or a limited scope of products and services usually an attribute e.g UK have good eduction system and high income leading to specialising in film,tv,pharmaceutical jobs which need high education and offer high income.
China , manufacturing as high population work force.
FDI
Inward - when a forging business invests in local economy (foreign purchase and business or land in uk) - creating jobs and spending, multiplier effect.
Outward - when local economy invests in forgeon(UK in forgein country) -opportunities new market, and profit opportunities.
Trade liberalisation
Reduction or removal of barriers to trade
+increased international trade, increased output and economies of scale.
-infant industries may not be able to compete with international firms
Factors contributing to increased globalisation
Political change - changes in gov , china joined WTO largest exporter in the world.
Reducing cost of transport and improved communication.
Increased FDI and migration, as transport costs reduced and easiest now and workers have more flexibility of where to work.
Protectionism
When want to protect the domestic industry otherwise domestic jobs are lost, spending decreases in local economy and more benefits paid for job losses.
Tariffs- tax on imports
Quotas- limit of imports
Legislation- product has to be certain standard, e.g food and feed safety labels to protect public health.
Subsides- grants given to businesses to encourage, e.g dairy producers worried of supply of milk in UK, so EU subsized uk dairy farmers.
Tariff
Placed on imported goods, increases prices which shifts demand away from foegein business
Import quotas
The gov limit on amount of a particular product allows in the country
Other trade barriers
Gov legislation - laws as to what can be imported to protect customers e.g USA chicken made with chlorine .
Domestic subsides - payments to own businesses tower costs.
Trading blocks
Group of countries usually near by, usually no tariffs or quotas, improved ease of trade, e.g EU adopted the same currency.)
ASEAN- Asian trade bloc, China and India not a part of.
USMCA- used to be NAFTA.
