Dimensions Of Globalisation

Question 1

Define Globalisation

Answer 1

Globalisation is a process by which economies, societies and cultures become more integrated or connected. This is made possible by a global network of trade, communications and migration.

Question 2

What are the dimensions of globalisation?

Answer 2

Flows of capital
Flows of labour
Flows of products and services
Flows of information and ideas
Global marketing
Global distribution of production and consumption

Question 3

Define Flows of Capital

Answer 3

This refers to all money that flows between countries which is used for investment

Question 4

What are examples of Flows of Capital?

Answer 4

• Foreign direct investment (FDI) - $1500 billion in 2016. Usually by TNCs
• Loans from and to global financial institutions - IMF
• Bilateral loans and aid – between 2 countries
• Remittances – payments by diaspora

Question 5

Define Flows of Labour

Answer 5

This refers to the migration of people mainly in search of better employment opportunities

Question 6

Describe Flows of Labour

Answer 6

• The flow is largely from periphery to core regions.
• These people are known as economic migrants.
• There has been a 40% rise in international migration between 2000 and 2012.

Question 7

Describe Flows of Products and Services

Answer 7

Products can flow easily around the world due to containerisation and a reduction in protectionism.

Services can also flow globally. They include financial and insurance services. They can be sub-divided into high level services (to business) and low level services (to consumers).

Question 8

Describe Flows of Information and Ideas

Answer 8

Globalisation means that ideas and information can flow globally.
This flow has been made possible by:
•Increases in international migration
•Improvements in technology. In particular digitisation and satellite technology leading to widespread use of the internet and mobile communications.

Question 9

Describe Global Marketing

Answer 9

Marketing refers to the process of promoting, advertising and selling both products and services.
•Global marketing means that companies are able to sell the same product, in the same way everywhere.
•This is an effective strategy for the TNCs as it reduces costs – called economies of scale.

Question 10

Define Global Marketing

Answer 10

Global marketing means that companies are able to sell the same product, in the same way everywhere

Question 11

Define Global Distribution

Answer 11

Global distribution refers to the spread of products or services across the world.

Question 12

Define TNC

Answer 12

TNC refers to a company which has branches in more than one country

Question 13

Define Global Shift

Answer 13

Global shift refers to the transfer of manufacturing industries from HICs (the core) to NICs (the new core) and LICs (the periphery)

Question 14

Define De-Industrialisation

Answer 14

De-industrialisation refers to the decline in manufacturing (secondary industry) in HICs

Question 15

How has the global distribution of production changed?

Answer 15

Global shift has seen movement of manufacturing plants to NICs – firstly ‘Asian Tigers’ but more recently China. It has also seen the movement of high level services to NICs. In particular to India – this is called outsourcing.

Question 16

How has the global distribution of consumption changed?

Answer 16

Global shift has seen an increase in spending power and higher demand for good and services. Consumption increases in NICs.
Also rapidly increasing population also leads to higher consumption

Question 17

Why has the global distribution of production changed?

Answer 17

TNCs seek comparative advantage through lower labour costs and relaxed health, safety and environmental regulations. educational and skills levels can match those in HICs. India has a large educated, English speaking graduate workforce. All supported by government incentives.

Question 18

Why has the global distribution of consumption changed?

Answer 18

TNCs provide direct and indirect employment in NICs. The local workforce have increased disposable income and can spend this on good and services. Consumption increases in NICs.

Question 19

What are the consequences of the global distribution of production changing?

Answer 19

De-industrialisation has led to job losses in HICs. Tax revenues fall – the negative multiplier effect. However, jobs are transferred to NICs.

Question 20

What are the consequences of the global distribution of consumption changing?

Answer 20

In NICs jobs are created. Tax revenues are increased – the positive multiplier effect. However, there are now opportunities for TNCs to provide financial services.