Globalisation

Globalisation :: The integration between different countries and economies and the increased impact of international influences on all aspects of life and economic activity.
Globalisation has lead to an increase in global interdependence.
Globalisation has lead to increased economic integration.

Indicators:

Global trade in goods and services has grown rapidly in recent decades
- US$4.3 trillion (19%) of GWP in 1990 → 22.6 trillion (26%) in 2020
During economic downturn → global trade has contracted, indicating the volatility of these connections

Since financial deregulation of many countries:
- Overseas investments → Portfolio investments (equities, currency, derivatives, Interest rates)

Foreign direct investment (FDI) involves movement of funds directed in economic activity or the purchase of companies
- FDI is when a lot of money (usually 10% ownership) is invested overseas
- FDI indicates distinct interest in the business, opposed to portfolio investments
Portfolio investments: an investment flow, smaller in scale
Transnational corporations (TNCs) are :: corporations that have production facilities in countries around the world
- such as Apple, Shell and Toyota
- they bring foreign investment, new technologies, skills and knowledge.
- Governments often encourage TNC’s (via policy, subsidies and concessions) to set up in their own country (they bring capital and jobs)

Technological advancements have played a central role in globalisation by facilitating the integration of economies.
technological changes on trade:
- Freight technology
- Communication
- Internet and social media
- Transport developments

“International division of labour is :: how the tasks in the production process are allocated to different people in different countries around the world.”
- The movement of labour between economies, usually concentrated at the top & bottom ends of the labour market
- e.g. New Zealand medical graduates moving to Australia