global systems and global governance Flashcards
(168 cards)
define globalisation
process by which nation economies, societies and cultures have become increasingly integrated, through trade, communications, transport and immigration
how can globalisation be measured
KOF index measures social, political and economic dimensions
- countries rated between 0-100
- most globalised are Switzerland, Belgium, Netherlands and UK (mainly europe)
dimensions of globalisation
- economic- increase in free trade, growth of TNCs, faster and cheaper transport, global marketing
- cultural- westernisation, cultural diffusion, migration, global communication
- social- migration, social networks, exchange of ideas
- political- trading groups, global institutions, NGOs, growth of Western democracies
- environmental- green campaigns, global commons
- health- medical advances, pandemics, pharmaceuticals
- technology- higher productivity, communication
what are the factors of production
land- natural resources
labour- human resources of a workforce to produce goods and services
capital- investment
enterprise- human capital
define flows of capital
any physical resource that can be regarded as a manmade aid for production
define core areas
economically important and affect investment/capital and people
define periphery areas
power and many experience exploitation and leakage
different ways flows of capital operates
- foreign direct investment- investment by TNCs like setting up subsidiary companies or through mergers
- repatriation of profits- TNCs invest in overseas production and profit made will be sent back to home country
- aid- provided through UN or made directly from richer countries (ODA)
- migration- poorer to rich countries, but nations may lose more of their skilled labour
define flows of labour
movement of people
flows of labour patterns globally
- africa has the most movement, either within its own continent or to europe
- largest inter regional flow between south and west asia (3 million between 2010-2015)
- most latin america go to north america
- most migration is over short distance
- higher skilled people can afford to go to more developed countries
- north america and europe tend not to leave
- movement in europe due to EU- 700,000 from poland to UK
- UAE had 5th largest international migrant stock in the world, composing 90% of their workforce
features of flows of products
- facilitated by reduction in costs of trade like tariffs and transaction costs
- containerisation has made it easier
- world trade organisation encouraged tariffs to stay low
- regional trading blocs- tariff free
- air travel makes it quicker
- low labour costs abroad meant goods have relocated- dyson moved to malaysia in 2002
features of flow of services
- high level (businesses like finance) vs low level ( for customers like travel and tourism)
- service industries are footloose- operate anywhere
- high level services are concentrated in more developed areas but now also in east asian economies like hong kong
- conglomerates- HSBC has smaller companies in banking, insurance, travel
- decentralisation of low level services to developing world like call centres- outsourcing
features of flow of information
- influence by movement of people
- transfer cultural ideas, language, industrial technology
- digitalisation and satellite technology- global phone networks, internet, media
- help expand knowledge like pharmaceuticals and business services
define and features of global marketing
advertising and selling goods/services across one single market
- brands should make the same product that can be used globally through economies of scale- save money
- markets can be adopted to regional markets (globalisation) e.g mcdonald’s
- coca cola- same bottle design, same taste
global patterns of production
- production has decentralised since 1954, where 95% of manufacturing was located in western europe and north america
- FDI by TNC’s meant production relocated overseas to lower wage economies- global shift
- TNC’s can also transfer technology which have allowed developing countries to improve the productivity of manufacturing
- growing economies in middle east are becoming more prominent in oil exploitation
- china, india and turkey are biggest exporters of textiles and clothes
global patterns of distribution
- manufactured goods are not versatile and far reaching due to advances in transport and communication
- transport time and costs have fallen
global patterns of consumption
- mainly in developed economies
- major trend in growing middle class countries like BRIC’s and MINT’s
factors contributing to globalisation
- communications and technology
- financial systems
- transport systems
- security systems
- management and information systems
- trade agreements
factors contributing to globalisation communications and technology
- development of internet
- 7 billion mobile phones users
- computerised logistics systems
- services like call centres can be outsourced
factors contributing to globalisation financial systems
- financially integrated due to financial deregulation
- regulatory bodies like international monetary fund
- high speed electronic transmission systems and global exchange connectivity means fewer concerns about exchange rates
- banks are global institutions
- communication technology has allowed for more informed decisions in terms of stocks and money
- global banking crisis in 2008-2009- due to free movement of capital
factors contributing to globalisation transport systems
- containerisation- shipped quicker and in larger quantities
- increased size of aircraft
- high speed rail networks- can link urban and rural China
- dry ports- located inland and near to their business, Pakistan has 6 inland dry ports where goods are deposited by producers before being sent to the port
- flights are now cheaper, due to privatisation, and there is more chance
factors contributing to globalisation security systems
- terrorism security measures
- checking food imports
- bio security- checking for harmful organism and transmission of diseases, COVID test passes
- cyber crime- breach of information
- 9/11 has increased border control
- can work together like NATO to deter threats
factors contributing to globalisation management and information systems
- global companies have invested in large production and global marketing- economies of scale
- global value chains- different production stages are in different countries
- enabled through information systems and allows for telecommunications and integrated IT management
- just in time (JIT) systems are more efficient by ensuring the correct quantities are available on time to avoid goods being held in stock
- global corporations focus on outsourcing non strategic activities
- rapid growth of logistics and distribution
what is a trading bloc
group that encourages free trade between member countries without incurring tariffs