Case Study - Outsourcing To China Flashcards

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1
Q

Global outsourcing to china

A

Global shift of manufacturing caused extreme poverty in china to fall from 60% to 16% by 2005
Gained the reputation of “workshop of the world” due to a massive pool of low cost migrant labour
Between 2000/2010, conditions improved for workers and wages increased to $1500 a month
Products such as iPhones are made in china, not just “throw away” cheap goods

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2
Q

Costs of outsourcing to china

A

Many workers were exploited in sweatshops.
Around 2500 metal workers lost a limb or finger each year due to dangerous factory conditions. (Gained a reputation)
Environment suffers greatly (air pollution) which causes cancer and strokes

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3
Q

Benefits of outsourcing to china

A

As conditions improve, people enjoy large income gains
Car owner ship grew from 1/100 families to 1/5 families since 2000
China’s economy grew
Transfer of technology (locals adopt new technology)
China is now developing its own products
China’s banks are now some of the world’s largest TNCs

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