4.1.3 Factors Contributing To Increased Globalisation

Question 1

What are the 8 factors causing increased globalisation

Answer 1

1. Trade liberalisation (removal of trade barriers)
2. Political change
3. Structural change
4. Increasing population
5. Migration
6. Increasing FDI
7. Increase in global companies (MNC’s and TNC’s)
8. Better access to transport and communication

Question 2

Explain how trade liberalisation has led to increased globalisation

Answer 2

• a reduction in regulations, tariffs and quotas
• encourages international trade and globalisation
  + imports become cheaper
  + exporting goods becomes easier
  + greater consumer choice

Question 3

Disadvantages of trade liberalisation

Answer 3

• the lower prices of imports may force domestic business out
• people feel that trade liberalisation removes national cultures

Question 4

How can political change increase globalisation

Answer 4

• governments may remove legislation that discourages international trade
• trading blocs reduce trade barriers

Question 5

How can structural change lead to globalisation

Answer 5

• as a country develops, reliance on primary and secondary sectors fall and tertiary and quarternary sectors
• this creates a higher demand for goods and services opening them up for international trade

Question 6

How does an increasing population contribute to increased globalisation

Answer 6

• a greater global workforce makes it easier for firms to set up where they want with less restrictions due to lack of labour

Question 7

Explain how increased migration has caused an increase in globalisation

Answer 7

• people that love create a new demand for products in the area they move to
• businesses can also move abroad easier as skilled staff are willing to move

Question 8

How is FDI increasing globalisation

Answer 8

• governments that ant to obtain the benefits of FDI are offering firms financial incentives
  -this increases FDI therefore increasing globalisation

Question 9

How has an increase in global companies increased globalisation

Answer 9

• MNCs and TNC’s boost the economies that they work in by offering more employment
• this increases the standard of living and disposable income that increases demand and spending

Question 10

How has improvements in transport and communication increased globalisation

Answer 10

• reduction in cost and time for transportation encourages importing and exporting
• technology and the internet means that communication is quick and easy between countries making it more convenient