Globalisation

What is globalisation?

• TNCs - companies around the world
• Leads to glocalisation
• Taking away from local companies
• Communication - social media
• 'Smaller world'
• Easier transportation
• Western influence globally
• Rich get richer

Globalisation - the processes by which people, their cultures, money, goods and information can be transferred between countries with few or no barriers.

Barriers:

• Physical aspects
• Religion
• Quotas/tariffs
• VISAs/migration laws
• Laws (China, DPRK)
• Language
• Border security
• Social classes

Interdependence between countries means that they are dependent on one another in some way.

Glocalisation - where TNCs source parts close to markets, so they can customise products to meet local tastes and laws (economic and cultural reasons).

Factors affecting globalisation:

Transport:

• 1930s - average of 11 people on each aircraft. Journey to Bangkok 8 days, now 11 hours
• International trade - large cargo ships

Communication:

• Technology helps businesses to connect to different countries
• Media coverage
• GPS

TNCs:

• Employing people in developing countries (no minimum wage)
• Uniformative products e.g. iPhone
• International marketing

International organisations:

• No barriers to trade (e.g. European Union)
• IMF (International Monetary Fund), NATO (North Atlantic Treaty Organisation), UN (United Nations)

Trade:

• Increase in trade - today, US$8 trillion per year
• China key factor in world trade
• Easy to trade between countries - improved transport and technology/communication

Tourism:

• US and China have the largest travel and tourism economies. Far away from each other - 'smaller world'
• Progressive policies on VISAs and taxation - easier to get to, more tourists
• Will account for 9.5% of total employment - 2014, 227 million jobs

Mulitplier effects - where a change in one part of the economy results in knock-on effects in other parts of the economy.

Impacts of globalisation:

• Some TNCs (e.g. Shell Oil) have higher turnover than the GDP of some countries
• Trillions of dollars are exchanged electronically every day in payments, loans, shares and debt.
• Companies (News International) influence how people think on issues
• A loss of national identity. Companies gain power over national governments. Governments may lose control over their countries
• People with IT, management and finance skills are moving around the world to where jobs exist
• Global tourism has increased, transporting…