eq1 key terms

Question 1

globalisation

Answer 1

process by which people, cultures, money, goods and information can be transferred between countries with little barriers, increasing interconnections between global locations

Question 2

interdependence

Answer 2

two places over-reliant financially or politically with one another

Question 3

spatial division of labour

Answer 3

movement of low-skilled work abroad to keep labour costs low. HQ’s remain in HICs usually

Question 4

intermodal containers

Answer 4

large capacity storage units to transport freight without items needing to be removed from the container

Question 5

offshoring

Answer 5

TNCs building production facilities in ‘offshore’ low wage economies

eg. 1987 Fender (Us guitar company in mexico

Question 6

foreign merger

Answer 6

two firms in different countries join forces to make single business/entity

eg. shell - Uk and netherlands

Question 7

foreign acquisition

Answer 7

TNC launching a takeover of a company in another country

eg. Kraft takeover cadbury 2010 for £12bn

Question 8

transfer pricing

Answer 8

where a business channels profit through a subsidiary company in low tax country (like ireland)
OEDC is trying to prevent this

eg. Starbucks, Amazon

Question 9

FDI

Answer 9

foreign direct investment
investment from TNC into nations economy to build facilities to acquire/merge with existing firm

Question 10

protectionism

Answer 10

policies to protect businesses/workers in a country through restrictions trade with foreign nations

Question 11

neoliberalism

Answer 11

political idea which aims to increase importance of businesss and decreasing influence of the government (idea is wealth increases, poverty decreases)

Question 12

privatisation

Answer 12

public services become privately owned to increase profit

Question 13

free trade

Answer 13

government doesnt interfere with imports/exports (no tariffs/subsidies/quotas)

Question 14

free-market economy

Answer 14

market economy based on supply and demand with little intervention from the government

Question 15

tariff

Answer 15

tax imposed on imports

Question 16

quota

Answer 16

limit on quantity of a good a country allows in

Question 17

subsidy

Answer 17

financial assistance to a business by government to prevent collapse / make it competitive

Question 18

free-market liberalisation

Answer 18

businesses able to dictate prices due to less influence from the government, aiming to transfer control to private sector

Question 19

trade blocs

Answer 19

voluntary intergovernmental agreements regarding trade and security (encouraging neoliberalism)

Question 20

remittances

Answer 20

sending money to other countries (e.g live in one and transfer money back to families)

Question 21

glocalisation

Answer 21

changing the design of products to meet local tastes and laws (e.g. no beef burgers in India)