Global governance

• Globalisation is the term used frequently within trade and economics

  • it describes a process of opening up world trade and markets to TNCs
  • makes the world increasingly connected
• Dimensions of globalisation

  • flows of capital, technology and capital
  • flows of products and labour
  • flows of services and global marketing
  • patterns of production, distribution and consumption
• Flows of information, technology and capital

  • cheap, reliable and near instantaneous communication between virtually all parts of the world
  • allows for more information and capital to be shared at unprecedented levels
  • money flows electronically around the world
  • HDEs invest in LDEs to take advantage of cheaper production costs
  • Technology - internet and associated mobile technologies, largely ignores political boundaries when connecting people and places
  • countries like india provide a range of financial and IT services for higher income countries
• Flows of products and labour

  • global transport have never been cheaper or more efficient in moving people and goods
  • high speed rail network, international airport hubs and containerisation
  • people moving around the world for employment
  • tourists now travel increasing distances to more remote and exotic locations
• flows of service:

  • services such as global marketing, follow the flows of capital, information, people and products
  • marketing is now globalised and uses international strategies
  • global products such as coca cola or Nike rely on common global brand with the same identity
• What is globalisation?


  It is the process of the world‘s economies, political systems and cultures becoming more strongly connected with each other
• types of globalisation:

  • economic
  • cultural
  • political
  • social
• capital flows:

  • movement of money for the purpose of investment/trade or to produce goods/services
• Labour:

  • all human, physical and mental effort used to create goods or provide services
• Flows of information

  • email, internet and social media spreads information quickly
  • making the world more interconnected
• Flows of capital:

  • historically capital was mostly invested within a country
  • foreign direst investment has increased international investment
  • ICT has made this easier
• flows of products

  • historically manufactured good were made in HICs
  • manufacturing has now decreased in HICs
  • low labour costs = production moving to NEEs and LICs
  • international trade in manufactured good is increasing
• flows of service

  • services are economic activities that aren’t based around making material goods
  • improvements in ICT, deregulation and opening up of national financial markets - made easier for financial institutions to do business in other countries
  • services can be split into high level and low level
  • high level - financial services HICs
  • low level - customer service in NEEs
• flows of labour

  • migrating internationally for work
  • high skilled workers moving to HICs for better wages and working conditions
  • unskilled workers move because pay and working conditions and bad in own country
  • people migrating - bring aspects of their country with them
  • countries are connected because people have family all over the world
• Global systems rely on interdependence
• economically interdependent

  • Countries rely on eachother for economic growth
• social interdependence

  • greater connections create social interdependence between countries
• political interdependence

  • countrises are dependent on each other to solve issues that cannot be addressed by just one country eg: 2015-2016 migrant crisis
• environmental interdependence

  • every country is dependent on the rest of the world to look after the environment - Chernobyl explosion affected people outside of Ukraine
• Global trade rules

  • WTO crates rules about how countries can trade
• Trade blocs and agreements

  • associations between different governments that promote and manage trade
  • either regional or based around a specific industry
• changing trade relationships

  • Most trade takes places in between developed countries
  • in emerging economies trade is increasing
  • LICs mainly trade with HICs or NEEs