Key Terms Flashcards
(20 cards)
Capital flows
The movement of money for the purpose of investment, trade, or to produce goods / services.
Usually regarded as investment into a production operation.
Define globalisation.
A process by which national economies societies and cultures have become increasingly integrated through the global network of trade, communication, transportation and immigration.
Define international trade
The exchange of capital, goods and services across international borders.
As imports (inbound trade) or exports (outbound trade).
Define labour.
Factor of production defined as the aggregate of all human physical and mental effort used to create goods or provide services.
Define BRIC
Acronym for four countries - Brazil, Russia, India, China.
Who’s economies have advanced rapidly since the ’90s.
Define diaspora.
A large group of people with a similar heritage or homeland who have moved and settled in places al over the world.
Define leakages.
A loss of income from an economic system.
Most usually refers to the profits sent back to their base country by TNCs (aka profit repatriation).
Define containerisation.
A system of standardised transport that uses large standard size steel containers to transport goods.
Can be transferred between ships, trains and lorries - enabling cheaper, more efficient transport.
Define protectionism.
A deliberate policy by government to impose restrictions on trade in goods and services with other countries - usually done with the intention of protecting home based industries from foreign competition.
Define conglomerates.
A collection of different companies / organisations which may be involved in different business activities but all report to one parent company.
Eg HSBC in banking an financial services.
Define economies of scale.
The cost advantages that result from the larger size, output of scale of an operate as savings are made by spreading the costs or by rationalising the operations.
Define maquiladora.
A manufacturing operation (plant) located in free trade zones in Mexico.
They import materials for assembly, then export the final product without trade barriers.
Define bottom up.
When local people are consulted and supported in making decisions to undertake projects / developments that meet their specific needs.
Define top down.
When the decision to undertake projects / development is made by a central authors eg government with little to no consultation with local people whom it will affect.
Define bilateral agreement.
An agreement on trade (or aid) that is negotiated between two groups of countries.
Define common markets.
A group formed by countries in geographical proximity in which trade barriers for goods and services are eliminated.
(This may eventually apply to removing any labour market restrictions, as in the EU).
Define customs unions.
A trade bloc which allows free trade with no barriers between its member states but imposes a common external tariff to trading countries outside the bloc. (Eg the EU).
Define tariffs.
A tax placed on imported goods with the intention of making them more expensive to consumers so that they do not sell them at a lower price than home based goods. (A strategy of protectionism).
Define multilateral agreement.
An agreement negotiated between more than two countries at the same time.
Define outsourcing.
A cost saving strategy used by companies who arrange for goods or services to be produced or provided by other companies, usually at a location where costs are lower.
