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2 Nov 2010
School
Department
Course
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L03
globalization: increasing economic interdependence of national economies across the
world through a rapid increase in cross-border movement of goods, services, technology,
and capital
* leads to the emergence of a global marketplace or a single world market
international trade: exchange of goods, capital, and services on an international scale
* butterfly effect - what happens in one country has a huge effect in others
foreign direct investment (FDI): investment in other parts of the world
* progressively growing around the world
internationalization of commercial exchanges: measured with export of goods/services
* geographical specialization of different countries (manufacturing production, technology
goods based on research, raw materials) -- comparative advantage
Integration of Economies
- made possible by:
technology
communication networks
internet access
growth of economic cooperation
trade blocs (NAFTA, EU, etc)
international treaties of free trade (GATT)
Multinational Corporations
- companies or transnational enterprises with headquarters in one country but business
operations in many countries
- 1980 = 7000, in 2002 = 64 000 MNCs, controlling 870 000 branches and 54 million
employees (70% of global trade flows)
Pro-Globalization Argument
liberalization Æ increases growth
increased growth Æ increases wealth
increased wealth Æ decreases poverty
decreased poverty Æ increases health
increased health Æ increases growth
- neo-colonialism -- for developed to take most of the resources of developing
- inequalities within regions
- globalization allows countries to compete on the same level
- differences in annual growth - history of growth/stabilization/lack of
* life expectancy in low-middle, and high income countries are converging - improving
- maternal mortality - less reduction in Sub-Saharan Africa
- 30 countries with the shortest life spans, 29 are in Africa; 40, 35 in Africa
- birth/death rates are slowly converging in sub-Saharan Africa in time - but slowly
- after collapse of USSR, people are receiving more university level education
- 3.3 billion people live in urban areas
- more than 850 million people live in slums - projected 1.4 billion in 2010 in the absense of
effective political interventions (UN, 2009)
- infant mortality is lower in urban areas - but more unequally distributed depending on
income/financial state
- India/China - China has higher survival rate HOWEVER increase in wealth is
unproportional
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Document Summary

L03 globalization: increasing economic interdependence of national economies across the world through a rapid increase in cross-border movement of goods, services, technology, and capital. * leads to the emergence of a global marketplace or a single world market international trade: exchange of goods, capital, and services on an international scale. * butterfly effect - what happens in one country has a huge effect in others foreign direct investment (fdi): investment in other parts of the world. * progressively growing around the world internationalization of commercial exchanges: measured with export of goods/services. * geographical specialization of different countries (manufacturing production, technology goods based on research, raw materials) -- comparative advantage. Made possible by: technology communication networks internet access growth of economic cooperation trade blocs (nafta, eu, etc) international treaties of free trade (gatt) Companies or transnational enterprises with headquarters in one country but business operations in many countries.

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