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Flashcards in Globalisation Deck (35)
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Who coined the term "global village" and what do they mean by this?

Marshall McLuhan coined the term "global village" in the late 1960s.
Global Village means free rein is given to economic and information flows.


How does the "global village" change the way organisations operate?

They think globally (not confined within national boundaries)
They act globally ( become more present in many countries)
They make "planet- wide" decisions


How is the global village ideology exaggerated?

Obstacles to trade remain
Globalisation has barely begun in some sectors


When and why was globalisation slowed down?

The 2008 global financial crisis slowed globalisation temporarily
Recovery from this process has hit set backs such as international conflicts
Progress has been made with international trade and access to markets however the world is still not "flat"


What has international trade lead to?

Lead to a "world economy" in which prices, supply and demand are affected by global events


How has trade changed since WW2?

Grown enormously
Manufactured goods have grown from US$100Billion 1956 to US$19 Trillion in 2013.


What is a definition to capital flows?

The movement of money for the purpose of investment, trade o to purchase goods/provide services. Usually regarded as investment into a production operation


What is the definition for globalisation?

A process by which national economies, societies and cultures have become increasingly integrated through the global network of trade, communication, transportation and immigration.


What is the definition of international trade?

The exchange of capital, goods and services across international borders.


What is the definition of labour

Factor of production which requires physical and mental human effort used to create goods or provide services.


What Are the 6 factors of globalisation?

Economy - trade and aid, TNCs and capital flows
Society - migration and social networks
Culture - 'westernisation' and cultural diffusion
Technology - higher productivity, transfer to LEDCs and communication
Environment - impact and degradation, linked by 'commons'
Politics - trading groups, governmental and global institutions


What are the 4 factors of production ?

Land- all natural resources ( minerals, soil, water, forests, etc)
Labour- human resource available to the economy
Capital- physical resource ( buildings, factories etc) involve the transfer of physical resources from one place to another. Usually refers to investment.
Enterprise- those who take a risk and establish a business or organisation for the production of goods and services


What is the 'flow of capital' ?

All money that moves between countries which is used for investment, trade or production is knows as 'international capital flows'


When did deregulation of world financial markets take place and what did they mean?

Took place in the late 20th century
Meant that the activities of financial institutions such as banks, insurance companies and investment companies were no longer confined within national boundaries


What is economic globalisation caused by and what are the characteristics

Caused by - increase in free trade, growth of transnational corporations, faster and cheaper transport and global marketing
Characterised by - long distance flows of goods, capital and services as a well as information and market exchanges


What is cultural/social globalisation caused by and how is it characterised

Caused by- migration, global communication networks, impact of western culture through media, sport, leisure and celebrity
Characterised by- spread of ideas, information and images


What is political globalisation caused by and what are the characteristics?

Caused by- growth of western democracies and their influence on poorer countries, decline of centralised (communist) economies (though communist political control is still strong in China and Russia)
Characterised by - the diffusion of government policy and development of market economies in former communist states


What is BRIC?

Brazil, Russia, India and China whose economies have advanced rapidly since the 1990s


What is diaspora?

A large group of people with a similar heritage or homeland who have moved and settled in places all over the world


What are economic leakages ?

Loss of income from an economic system. Usually refers to the profits sent back to their base country by transnational corporations, also known as profit repatriation


What is MINT?

Mexico, Indonesia, Nigeria and Turkey who are the more recently emerging economies.


What is Foreign Direct Investment?

An investment made mainly by TNCs based in one country, into the physical capital or assets of foreign enterprises.


What are Repatriation of profits?

TNCs investing in overseas production will take profit made from that investment back to there home country.


What is aid? Define multilateral and bilateral.

Financial support for poorer countries.
Multilateral - number of countries making contributions (UN)
Bilateral - one government to another, usually with mutual conditions applied.


What is migration?

Majority of out-migration of labour is from poorer to richer countries.
Poorer workers lose there most skilled workers, who will pay taxes and spend their earnings in foreign countries.


What are remittance payments?

Transfers of money by foreign workers to family in their home country.


What are the the key facts about the movement of labour?

From developing countries to the richer nations
Major destination oil rich gulf states (Kuwait, Qatar, Saudi Arabia,UAE)
Most migrants move over short distances within the same region or between neighbouring regions
Most migrants have some education and financial means
Largest flow in Asia (2005-2010 5million workers South Asia-west Asia)


Key facts about the remittance dilemma in Somalia ?

2012, 40% of somalians relying on remittances to meet their basic needs
Remittances are 50% of GNI and 80% of all investment into the country
Concern that this money was aiding terrorist groups caused US and U.K. Withdrawing the service.


Why did the US and UK withdraw money from Somalia in 2012?

Little government regulation over the economy
Lack of anti- money laundering laws
Suspicious activity reports for money transmitters
Some remittances going to terrorist group Al-Shabaab


How are flow of products facilitated and define these reasons

Reduction in costs of trade (transaction, tariffs, transport and time)
Transaction costs reduced with improved flow of data making transfer of capital quicker
Transport and time reduced by containerisation
Tariffs reduced in global trade by World Trade Organisation