Global Systems 1 Flashcards

1
Q

Globalisation

A

The process by which the world becomes more interconnected on an economic, social and political scale

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2
Q

Concept of globalisation

A
  • world has always been interconnected
  • concept only developed in 1960s
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3
Q

Forms of globalisation

A
  • Economic
  • Social
  • Political
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4
Q

KOF globalisation index

A

Measures the economic, social and political dimensions of globalisation

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5
Q

Most globalised nations

A
  • Switzerland
  • Netherlands
  • Belgium
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6
Q

Worlds major economies on globalisation index

A

Major economies (US, China, Germany) tend to be more inward looking and less globalised

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7
Q

Factors that affect how globalised a country is 4

A
  • Ease of trade
  • Foreign investment
  • Presence of TNC’s
  • Stability
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8
Q

5 major areas of globalisation

A
  • Economic
  • Social
  • Political
  • Flows of capital
  • Flows of labour
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9
Q

Economic globalisation is made up of what

A
  • Actual economic relations and flows
  • Restrictions to trade and capital
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10
Q

Social globalisation is made up of… (3)

A
  • Personal connections across the world
  • Information flows
  • Cultural proximity (International influence)
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11
Q

Distance decay

A

Process by which actual geographic distance symbolic feels smaller

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12
Q

Largest migrant flow

A
  • Mexico to US
  • 2 million annually
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13
Q

Information flows

A
  • Quantitative data on how well a country is connected
  • based on internet infrastructure, TV viewership and other tech
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14
Q

Political globalisation is made up of… (2)

A
  • Membership of international organisations
  • Diplomatic relations
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15
Q

Flows of capital is made up of…

A
  • International transactions between countries
  • Previously restricted domestically
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16
Q

Global FDI difference

A
  • $400 billion (1990)
  • $1500 billion
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17
Q

What drives further capital movement?

A
  • Improvements in access to technology
  • Interconnected nature of world
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18
Q

Value of global financial flows

A

$5.1 trillion

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19
Q

Trends of capital flows 3

A
  • US highly involved in capital flows
  • NA and Europe largest
  • Growing significance in Asia
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20
Q

Flows of labour is made up of…

A
  • Labour increasingly moving internationally
  • Generally poor to richer
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21
Q

Number of International workers

A

170 million

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22
Q

HIC facts in comparison to the world

A
  • Purchasing power = 50%
  • Population = 14.7%
  • Exports = 61%
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23
Q

Factors promoting globalisation 5 (PLSCI Please Slowly Look In Cod)

A
  • Flows of PRODUCT
  • Flows of SERVICES
  • Flows of LABOUR
  • Flows of INFORMATION
  • Flows of CAPITAL
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24
Q

Flows of information

A
  • Can be spread faster than ever
  • Makes the world more interconnected
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25
Q

What is Foreign Direct Investment (FDI)

A

Investment made by a foreign company in the economy of another country

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26
Q

Largest receivers of FDI

A
  • Germany, US and UK accounted for 27%
  • India and China 7%
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27
Q

Flows of product 4

A
  • Changing balance of economies based on global demand
  • LIC = Raw material
  • MIC = Manufacturing
  • HIC = Services
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28
Q

Drivers of outsourcing and product flows 3

A
  • Cost savings
  • Service quality
  • Strategic position
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29
Q

UK value of imports change

A
  • £200 billion 1990
  • £682 billion 2021
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30
Q

UK economy sectors change

A
  • 60% tertiary 1900
  • 81% tertiary, 1% primary 2000
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31
Q

Flows of services 3

A
  • Financial or insurance services
  • Low level services outsourced (Callcenters)
  • High level services (Financial)
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32
Q

What is a growing trend in outsourcing?

A
  • High level services are also being outsourced to where it is cheaper
  • KPMG outsourcing accountancy
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33
Q

What does the flow of services rely upon?

A

Depends on the flow of information and capital

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34
Q

Flows of labour

A

Movement of people from one country to another to work

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35
Q

How much has international migration increased since 2000?

A

40% in 15 years

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36
Q

Containerisation

A

System of standardised transport enabling goods to be transferred anywhere in the world

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37
Q

Developments supporting globalisation

A
  • Technology
  • Financial systems (SWIFT)
  • Trade agreements
  • Communications
38
Q

How many shipping containers empty back to China from US

A

3/4 in 2021

39
Q

Global marketing

A

Marketing strategy that targets the world as a single market

40
Q

Benefit of global marketing strategy 3

A
  • Economies of scale
  • Global appeal
  • Develop preexisting products
41
Q

Drawbacks of global marketing

A
  • Cultural differences
  • Homogenistation
42
Q

McDonalds as an example of global marketing 3

A
  • Uses consistent imagery internationally
  • Adjusts menu based on consumer preferences
  • Still carries consistent elements everywhere (Big Mac)
43
Q

Coca Cola operates in all countries except…

A

Cuba and North Korea

44
Q

How has CocaCola marketed itself globally?

A

Created single product where only minor elements are tweaked

45
Q

How many people are employed by CocaCola?

A

700,000

46
Q

How does CocaCola adjust global marketing strategy? 3

A
  • Consistent shape and size of bottle
  • Imagery changed to adapt to local culture
  • ‘Taste the feeling’ common theme
47
Q

How did Coke utilise social media? 3

A
  • Can tailor social media presence to target markets
  • Retain customers
  • Sensationalises brand
48
Q

What elements of Coke’s global marketing is similar to other campaigns?

A
  • Create positive association of brand
  • Universal movement via storytelling
49
Q

Coke’s contribution to globalisation 4

A
  • 0.7 million employed
  • HQ in Atlanta but operates in all
  • 70% of sales outside the US
  • Total value of $235 billion
50
Q

Impact of Coke on host countries (positive) 4

A
  • Training programmes for workers
  • Employment of women
  • Positive multiplier
  • Recycling awareness
51
Q

Impact of Coke on host countries (negative) 4

A
  • Worker exploitation
  • Growing obesity crisis
  • Profits taken from countries
  • Damage to water supplies
52
Q

Coke environmental impacts 4

A
  • Drain on watersheds
  • 2.9 million tonnes of plastic in ocean
  • Pesticide usage
  • Biggest ITW
53
Q

Coke global investment

A
  • $2 billion into India
  • $90 million into R&D
54
Q

BRIC nations

A

Brazil
Russia
India
China

55
Q

MINT countries

A

Mexico
Indonesia
Nigeria
Turkey

56
Q

Global manufacturing transition

A
  • 95% of global manufacturing in North America, Europe and Japan (1950)
  • 50% in LICs (2010)
57
Q

Why does some production remain in HICs?

A
  • Skilled workforce
  • Government subsidies
  • Access to markets (EU)
  • Tesla Berlin
58
Q

Patterns of production, distribution and consumption

A
  • Historical view all contained within local area
  • Modern era consumption only in HIC
59
Q

Changing patterns of distribution 4

A
  • Investment into infrastructure making trade easier
  • China - Peak railway $62 billion
  • Saudi port $20 billion
  • Arctic trade routes
60
Q

Diaspora

A

Group of people with similar heritage moving to the same area

61
Q

Profit repatriation

A

Profits made by TNCs been taken back to home country HQ

62
Q

Remittance

A

Transfers of money made by foreign workers back to home country

63
Q

Biggest remittances

A
  • US > Mexico ($22.2 billion)
  • Typically countries close to one another
  • Global to Philippines ($38 billion)
64
Q

What proportion do remittances make up of Philippines economy?

A

9%

65
Q

Benefits of flows of labour

A
  • Remittances can help develop nations
  • Address worker shortages
  • Better quality of life for workers
66
Q

Somalia flows into country

A
  • $12 billion in remittances
  • $800 million in Aid
  • $500 million in Exports
67
Q

Why are labour markets not as free flowing as financial markets?

A
  • Restrictions on immigration
  • Emotional connection
  • Cost of movement (transport, visa)
68
Q

Somalia remittances

A
  • $1.3 billion
  • Makes up 35% of GDP
69
Q

Causes for the need of remittances in Somalia 4

A
  • Agricultural crisis caused by drought
  • Civil war means no central authority
  • No developed industry
  • 67% youth unemployment
70
Q

What did people resort to in Somalia?

A
  • Piracy
  • Terrorism (Al Shabaab)
71
Q

What sanctions were placed on Somalia?

A
  • Removal from global financial system
  • Hampered flow of remittances and NGO efforts
72
Q

Why were sanctions put in place for Somalia?

A

Accusations of international funding of terrorism and piracy as well as money laundering

73
Q

Consequences of sanctions on Somalia

A
  • Reduction in piracy rates
  • Intensified civil war
  • Famine killing 0.25 million
74
Q

Long term sanction consequences for Somalia

A
  • Declared hungriest and poorest country
  • Money sent through unreliable 3rd parties
75
Q

Voluntary migrant

A

A person who chooses to move

76
Q

Forced migration

A

Person forced to leave country because of circumstances

77
Q

How are the flows of globalisation connected?

A
  • Economic, social, environmental and political flows all dependant
  • Any change can lead to global impact
78
Q

How does global risk vary?

A

As countries export and depend on different things it means their exposure to risk varies but carry global consequences

79
Q

Migration

A

Permanent or semi-permanent movement of people from one place to another

80
Q

Examples of migration

A
  • Fleeing conflict = Forced
  • Job opportunity = voluntary
81
Q

Unequal flows of people

A
  • People tend to move from where there’s a few(LIC) to many jobs (HIC)
  • Those that move aren’t the poorest
  • Restrictions
82
Q

UK unequal flow of labour example

A

Poland

83
Q

Gini coefficient

A

A measure of income inequality within a population, ranging from zero for complete equality, to one if one one person has all the income
- closer to zero means greater equality

84
Q

Lorenz graph

A
85
Q

Proportion of people living on $1.25 per day

A

Fallen from 47% to 22%

86
Q

8 richest have the same amount of wealth as…

A

the poorest

87
Q

Gap between poor and rich countries

A
  • 200 years ago gap was 3x wealthier
  • in modern day 80x richer
88
Q

Globalisation social effects

A
  • Impact on peoples lives
  • Wealth distribution
  • Somalia
89
Q

Globalisation economic effects

A
  • TNCs exploitation
  • Domestic industry loss
  • Domination
90
Q

Globalisation political effects

A
  • Trade blocs
  • Global institutions
  • Global commons (Global management required)