Global winners and losers

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  • Created by: keeels
  • Created on: 11-05-14 11:44

Switched on/ Switched off

Air travel, tourism, global businesses (TNCs) and communication systems create global networks - they connect different places together, accelerating globalisation. Global networks allow trade, money, people and information to flow around the world, e.g air travel and tourism allow more people to travel to different countries, bringing money and information with them

Global networks have helped to create places that are switched on (well connected to global networks, usually rich and powerful) and places that are switched off (poorly connected, usually not wealthy or powerful)

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Switched on

  • These are the most highly- connected countries, as well as the important cities in poorer countries, e.g Singapore is an important port, finacial centre and tourist destination
  • Because they're well connected, trade,  money , people and information flow easily between them and elsewhere - they're global hubs because global networks flow through them
  • People in switch on places are significant consumers and producers of goods and services because they're well connected
  • Energy usuage and the ecological footprint are large because of the high levels of production and consumption
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Switched off

  • These are the worst connected countrues, as well as some remote places in more wealthy countries, e.g Bhutan is a landlocked country in the Himalayan mountains, where tourism and access to the internet are restricted. The economy is based on agriculture, with little foreign influence
  • Some money does flow into switched off places, often in the form of aid. Also, they may grow some crops to make money (cash crops, e.g coffee) but they trade little and recieve very little for the crops
  • People in switched off places aren't significant producers or consumers because they're not well connected to global networks and aren't a potential market for TNCs
  • Energy usage and the ecological footprint are low
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interconnect/ dependent

  • Interconnected places have roughly equal exchange in the flow of trade, money, people and informatio, e.g the number of tourists visiting a country is equal to the number of citizens from that country that travel
  • One place is dependent on another if there is an unequal exchange in the flow of trade, money, people or information - more is coming in than going out e.g lots of tourists visit a country, but few citizens of that country travel

The multiplier effect also helps connected places grow in wealth - money spent in one place causes more money to be made in that place e.g more tourists visting a town means more hotels and restaurants are needed, so more money is invested in the city and more local people are employed. They'll spend their increased earnings in the city, and so on

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New technologies

Technologies like telecommunications, the internet and air travel create global networks, for example

  • Long distance telecommunications began when copper telegraph cables were laid across the Atlantic in 1866. Now there's a global phone network linking all countries
  • The internet allows people in offices that are far apart to work together at the same time
  • Low-cost air travel means it's cheap and easy to travel long distances for work and holidays

Global networks leads to a shrinking world - distances don't seem as far because places are vey well connected

  • EasyJet is a low cost airline that helps connect many places by making it easier for more people (not just the wealthy) to get to more places (not just popular places). it makes a pattern of connectivity, made up of all the places it flies to. The connection it forms can help make places switched on
  • For example, Tallinn is the capital of Estonia, and ex-Soviet state. EasyJet has made Tallinn more connected by setting up flights to and from there to other other European countries (e.g the UK). This has increased the flow of people, information and money between Talinn and other countries, helping make Tallinn more switched on
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Physical and Human factors

The winners in a globalised world are countries that have useful resources that are in demand - this helps them connect to global networks, so they become switched on

Winners can use their comparative advantages - they're well connected so they can easily trade for the things they need. This means they don't have to produce everything, but can concentrate on using their physical and human resources where they'd be most useful. The multiplier effect can also help them to become more wealthy

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Physical - Saudi Arabia

  • Saudi Arabia is an oil rich country in the Middle East that gets most of its wealth (about half its GDP) from the trade of oil - this is called petrodollar wealth
  • Saudi Arabia has coasts on two sides so oil can be easily shipped out to other countries
  • Saudi Arabia uses the money it makes from its comparative oil advantage to develop other parts of its economy. This helps to increase its global connections and keep it switched on 
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Human - China

  • China is a NIC with a huge populatio (more than 1.3 billion)
  • China can provide lots of cheap but relatively skilled labour, e.g the manufactoring industy in China has grown rapidly because of investment from Chinese and foreign companies. Cheap, skilled labour means costs are reduced and profit can be increased
  • China's comparative advantage in human resources has allowed other parts of its economy to grow because of the multiplier effect. This has helped to increase its connectivity and make it switched on
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Global losers

Global losers are countries that remain switched off from global networks. This can be because of difficult physical conditions (e.g landlocked countries) or poor leadership leading to political isolation (e.g a corrupt government) 

  • Zimbabwe is a landlocked country in south east Africa that is cut off from global networks. It has been politically isolated because of accusations of corruption and poor leadership. This has led to economic sanctions from the EU and the USA, reducing the flow of trade. Also, many airlines refuse to fly to Zimbabwe, reducing connectivity further

The consequences of being switched off from global networks mean global losers may be left further behind

  • Valuable resources may be wasted or left unsused because there's no investment to help trade in them
  • Conflict, starvation and disease may make it less likely that global connectivity will improve
  • Switched on countries are more likely to work together , helping them to progress fatster. This means the gap between switched on and switched off places will only get wider
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odd winners / losers

  • Odd winners - some areas are in difficult physical locations , but are still switched on e.g Las Vegas is a city in the Nevada desert, but is a global hub for tourism because gambling is legal there
  • Odd losers - some places are rich in a natural resource, but remain switched off e.g Sierra Leone (west Africa) is rich in diamonds but hasn't been able to generate much wealth from them due to civil war and government corruption
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