Factors which promote globalisation

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  • Four factors which promote Globalisation
    • Flows of Capital
      • Money that's invested
      • The amount of money invested in foreign countries has increased - This is FDI
        • E.G. Global FDI increased from $3000 billion to $12000 billion
      • Improvements in ICT means that info can be instantly transferred across the world
      • Increasing flows in capital makes the world more interconnected
        • E.G. Countries are dependant on flows of investment
    • Flows of Production
      • Manufacturing industries were located in MEDCs and products were sold in those countries
      • Manufacturing has decreased in MEDCs
      • Lower labour costs have lead to outsourcing of manufacturing and importing of the products made
        • Increase in international trade
          • UK imported £550 billion in 2005
      • More interconnected - buying goods from other countries
    • Flows of Services
      • Tertiary sector
      • ICT allows things like banking to be done anywhere in the world for other parts of the world
      • During the 70s and 80s there was a deregulation of national finance markets (USA and UK) -> easier for banks to do business with other countries
      • High level services are in MEDC cities (New York and London) whereas low level are in LEDCs where labour is cheaper (call centres)
      • More interconnected - by having a bank account you are connected internationally
    • Flows of People
      • International migration has doubled since 1975
        • Both economic migrants and refugees
      • More interconnected because people bring aspects of culture with them
      • High skilled workers move to MEDCs for better wages and working conditions
      • Low skilled workers move because of unemployment and low wages in their own country

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