GLOBALISATION EQ1 Flashcards
What are the causes of globalisation and why has it accelerated in recent decades? (26 cards)
What is globalisation?
Process by which people, culture, capital, commodities and information are becoming increasingly interconnected
What is colonialism?
The policy or practise of acquiring full or partial political power over another country, occupying it with settlers and exploiting it economically
What is imperialism?
The extension of a nations power by territorial acquisition or economic and political dominance of other nations.
What is the shrinking world concept?
Time taken to travel the world is decreasing as developments in travel and communication makes far parts of the globe feel closer together
What are the four strands of globalisation?
Political
Economic
Social
Cultural
What factors have accelerated globalisation (describe and explain)
Transport: containerised shipping, jet aircraft’s, high speed trains and trade relationships from the 19th and 20th century are increasingly powerful
Communication: internet, fiber optics, smart phones, social media, telephones replaced 3 week boat journeys with instant communication across large distances
How do smartphones illustrate globalisation?
Global production network: the functions, operations and transactions through which a specific product or service is distributed produced and consumed.
Outsourcing: hiring an organisation outside the company to perform services or create goods that were traditionally carried out by the companies own employees and resources.
Containerisation: a system of standardised transport using a common sized steel container to transport goods.
CASE STUDY: HOW ARE MOBILE PHONES CHANGING AFRICA?
-In parts of sub Saharan Africa, mobile phones are easier to access than electricity.
-Kenya and Egypt have Africa’s largest mobile network operators.
-Not accessible for every country, shows the diversity of Africa.
- Allowed easy access to health insurance on their phones, MicroEnsures Fearless Health has over 50 million registered users across Africa.
-Allowed access to mobile learning as not everyone had access to education
- specialised smartphone cameras to diagnose visual problems as there are limited healthcare professionals
- created to be robust with long battery lives to suit the conditions and the market.
Who are the key players in globalisation?
-IGO’s like the World Trade Organisation, World Bank and the International Monetary Fund and their role on global economics
-National governments that encourage connectivity with the rest of the world
What happened in Bretton Woods in 1944?
-Approx 730 delegates representing 44 countries met in Breton woods t promote economic international growth.
-They created the Word Bank and the International Monetary Fund
What is the WTO?
The World Trade Organisation, advocates for trade liberalisation in manufactured goods and asks countries to abandon protectionist attitudes in favour of untaxed trade
What is the IMF?
The International Monetary Fund, channels loans from rich nations to countries that apply for help, but recipients must agree to run free market economies that allow TNCs to enter more easily
What is the WB?
The World Bank, lends money on a global scale, has poverty reduction programmes, and directs grants to developing countries
What are barriers to trade? Why would a nation want this?
Tariffs: a tax placed on goods that are imported from other countries
Quota: a limit placed on the number of goods that can be imported from other countries
Embargo: a ban placed on certain goods imported from other countries
Subsidies: a sum of money granted from the government to help an industry or business keep the goods price low
Protectionism: the method of protecting a countries domestic industries from foreign competition
May wanted as it stops a decreased national unity and cultural diffusion
What is a trade bloc? (advantages and disadvantages)
A Trade Bloc is a group of countries that form an agreement where the movement of goods within the group is free. Tariffs and quotas are in place for those outside the block
Advantages: cheaper goods for the countries in the bloc, allows for a free market economy, no taxes or quotas for the countries involved
Disadvantages: impacts the nations’ economies as more capital is spent in other countries
What is neoliberalism?
A free market economic philosophy that favours the deregulation of markets and industries
What is free market liberalisation?
Removal of control in an industry or market to encourage the entry of new suppliers and thereby increase the intensity of competition
What is privatisation?
The transfer of ownership, property or business from the government to the private sector
What is chinas open door policy?
Policy introduced by Deng Xiaoping allowing china to open the door to international trade and large foreign TNC’s
Huge amounts of FDI turned global manufacturing from the west to china
How have national goverments encouraged buisness start ups?
Encouraging business start ups involves legal restrictions on foreign ownership and capital controls being removed. Foreign new businesses will be attracted to start up promoting globalisation
CASE STUDY: SPECIAL ECONOMIC ZONES SHENZEN
SEZ’s are regions designed within China to have more liberalised business policies and other government investment and production
In 1980 in Shenzhen a special economic zone was formed. Exports went from $2 to $200 million by 2000
$60 million was received as FDI per year.
What is FDI?
Foreign Direct Investment, A company from one country making a physical investment into building a factory in another country
What are the indexes of measuring globalisation? (describe and evaluate)
KOF index: 24 indicators spread over 3 categories: political economic and social globalisation. The numerical data of this is analysed and compared to existing data
Kearney index: 12 indicators spread across 4 categories; political engagement, technological, connectivity, personal contact, economic integration- complex points and weighing system.
Uses more holistic indicators than KOF
Evaluation:
-doesn’t include all countries
-doesn’t measure cultural trends
Smaller countries looked over, they are important due to reliance on FDI
-outlying/missing values change results
-cultural globalisation refers mostly to westernisation
CASE STUDY: SAHEL REGION (ECONOMCIC AND PHYSICALLY SWITCHED OFF) NORTH KOREA (POLITICALLY SWITCHED OFF)
Sahel Region, economically switched off:
poor infrastructure and low levels of literacy of the working age population make it unattractive for offshoring FDI. Low income levels means it lacks market size to attract retail outlet FDI. Few households other than the elite can afford to purchase imported goods
North Korea, politically switched off:
A hereditary autocracy ruled by Kim Jong Un. Run as a one party system organised as a communist system. Followed a policy system minimising trade with other nations. Emigration and foreign tourism is forbidden.
Sahel Region, physically switched off:
All four Sahel Regions are landlocked, relying on poor quality roads. High transport costs makes imports unattractive.
