WW these are my notes up until "drivers of globalisation" from the first dotpoint. Are these sufficent?
• GLOBALISATION:
GLOBALISATION-The move towards a global economy by the breaking down of trade barriers.
It is characterised by increases in flows of trade, flows of capital, flows of information & the increased mobility of people across borders.
GROSS DOMESTIC PRODUCT is the total value of production in the company
SUBSIDARIES are bizs which are controlled by a larger company.
The global economy developed since World War I
A MULTINATIONAL ECONOMY sets up plants in other countries that will make products to sell in that company.
A GLOBAL ECONOMY is run by TNCs. Manufactures in one country & exports to countries that want to buy their products.
A TRANSNATIONAL CORPORATION (TNC) is a company that has operations in different countries to form an interconnected global network of operations.
A MULTINATIONAL CORPORATION (MNC) are bizs that operate in more than 2 countries.
DEREGULATION is removing unnecessary laws & regulations that control the way bizs in an industry can operate.
• NATURE AND TRENDS OF GLOBALISATION:
o Globalisation affects countries, bizs & people.
o It is not unique to the present era. There have been periods of globalisation in the past.
o Since WW2, there has been a growth in globalisation. This has come in 2 stages:
o The era of the multinational economy – when multinational companies established subsidiaries in many countries.
o The era of the global economy – during which there was a significant reduction in protectionism & transnational companies grew rapidly.
o The era of global economy saw significant changes to financial/capital, labour & consumer markets.
In financial/capital markets –the deregulation of domestic financial markets & exchange rates has encouraged the development of an international finance & international equity market.
In labour markets – there has been an increase in free flow of labour across international markets.
In consumer markets –there has been the development of a similarity in the needs & wants across the world.
WTO Statistics:
• Merchandise Trade increased by 6.5% during the 90’s
• Merchandise production increased by 3.5% (slowed at end due to Asian economy crisis)
• TRENDS IN GLOBAL TRADE SINCE WW1:
Many changes in international trade relations have affected global trade since WW2. These include:
1. A shift from economic power
2. A growth in economic integration
3. Rapid economic growth in the Asian region
4. The collapse of command planning in Eastern Europe.
Expanded trade has accompanied these changes & capital flows between countries.
