Global Systems and Global Governance 1


Globalisation is the process of the world's economies, political systems and cultures becoming more strongly connected to each other.

If there was no globalisation, there wouldn't be any interaction between different countries. If there was complete globalisation, the whole world would act like a single community. The real world is somewhere in between, but countries are becoming more and more closely integrated.

Globalisation is caused by the movement of information, capital, products, services and labour between different countries. People have been moving between countries and international trade has been going on for ages, but most people think that globalisation as we know it today really started to accelerate in the 1980s.

As the world becomes more globalised, countries are becoming more interdependent. This has led to global-scale attempts to manage a range of international issues.

There are five factors that promote globalisation:

Flows of information:

  • Information, such as financial data or news of current events, can be spread across the world very quickly and easily.
  • The development and rapid spread of email, the internet and social media mean that large amounts of information can be exchanged intantly across the globe. This allows people living in different countries to communicate and work together.
  • Increasing flows of information are making the world more interconnected, e.g. people can learn a lot about different countries and cultures without leaving their own country.

Flows of capital:

Capital is money that's invested - it's spent on something to produce an income or increased profit from it.

  • Historically, capital was mostly invested within a country, e.g. companies would expand by doing things like building new factories or setting up new branches within their country of origin.
  • Over time though, the amount of capital invested in foreign countries has increased - this is foreign direct investment (FDI), e.g. global FDI increased from about $400 billion in 1996 to nearly $1,500 billion in 2016.
  • Improvements in information and communications technology (ICT) have encouraged flows of capital round the world - it can instantly be moved around the world via he internet.
  • Increasing flows of capital are making the world more interconnected, e.g. most countries' economies are now dependent on flows of investment to and from other countries.

Flows of products:

  • Historically, manufacturing industries were located in more developed countries. The products being produced were also sold in the country where they were made.




good outline of the different flows within global trade



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