M20

Question 1

What is the meaning of economic globalization?

Answer 1

Huge transaction volume of goods and services across countries, greater labour mobility across countries, rapid flow of capital, information and technology

Question 2

What are the factors leading to economic globalization?

Answer 2

Political changes, technological changes, economic changes.

Question 3

What are the political changes?

Answer 3

Government policy like removing trade bars, attractive immigration policies to attract foreign workers, international cooperation like joining international organizations.

Question 4

What are the technological changes?

Answer 4

Advancement in Telecommunication like monitoring production plants all over the world and investing in global market. Advancement in Transportation like large carriers can reduce time and cost.

Question 5

What are the economic changes?

Answer 5

Development of IFCs like more ways to raise funds, more markets to invest, more job opportunities. Development of Multinationals like global production mode which bring skills, money and technology and so on. Labour supply like boosting the high value added industry and workers will want to work overseas since they want a higher income.

Question 6

What are the positive social and economic impacts to the LDC government?

Answer 6

Import of foreign capital, management culture and technology can accelerate the pace of industrialization and modernization leads to economic transformation and development.

Question 7

What is the positive social and economic impact to the people in LDCS?

Answer 7

There are more job opportunities which means higher living standard.

Question 8

What is the positive social and economic impact to the people in MDCs?

Answer 8

More trading and investment opportunities leads to accumulation of wealth.

Question 9

What is the positive social and economic impact to the local customers?

Answer 9

Lower prices of goods.

Question 10

What is the positive social and economic impact to the multinationals?

Answer 10

Lower cost of land price, labour price and transport cost.

Question 11

What is the positive cultural aspect to the local customers?

Answer 11

More choices.

Question 12

What are the negative social impacts to the people in LDCs?

Answer 12

Economic benefits cannot be enjoyed by the LDCS as most of the benefits flow back to the MDCs which widens the income gap between countries.

Question 13

What are the negative social impact to the low skilled workers in MDCs?

Answer 13

Economic restructuring leads to unemployed leads to widening domestic income gap.

Question 14

What are the negative social impacts to the workers in LDCs?

Answer 14

Lack of awareness to protect labour rights leads to labour exploitation.

Question 15

What are the negative social impacts to the local small companies?

Answer 15

Mulitnationals can enjoy a lower cost, local stores have a lower competitiveness leads to close down.

Question 16

What are the negative social impacts to local customers?

Answer 16

Market monopoly leads to fewer choices in long run.

Question 17

What is the negative economic aspects to all stakeholders?

Answer 17

Economic interdependence

Question 18

Which are the IGOs related to economic globalization?

Answer 18

World Trade Organization, World Bank, International Monetary Fund and Organization for Economic Co-operation and Development.

Question 19

What is the use of World Trade Organization?

Answer 19

Deals with the rules of trade between nations at a global or near-global level, promotes free trade all around the world.

Question 20

What is the use of World Bank?

Answer 20

Offers financial and technical assistance to LDCs around the world with the goal to reduce global poverty.

Question 21

What is the use of International Monetary Fund?

Answer 21

Oversees the global financial system by following the macroeconomic policies of its member countries and offer loans with varying levels of conditionality mainly to poor countries.

Question 22

What is the use of Organisation for Economic Co-operation and Development?

Answer 22

It helps to work to build better policies for better lives and shapes policies that foster prosperity, equality, opportunity and well-being for all.

Question 23

What is the effectiveness of IGOs in economic globalization?

Answer 23

More developed countries have a large voting share which LDCs may not be able to voice out. LDCs need to open up their market after joining World Trade Organization.