Global governence

• Globalisation


  The process of becoming more globally connected on a variety of scales. It is the movement of people, knowledge, ideas, goods and money across national borders, leading to - theoretically - a 'borderless world'.
• Types of Globalisation


  • Environmental globalisation (e.g. pollutants from other countries can affect our climate and there are global laws to mitigate climate change)
• Flow


  When countries share things with one another, it's known as a flow. This is because things are flowing (moving) from one country to another. Flows can be physical like people or products, but they can also be ideas and concepts such as money (capital), services, or information.
• Dimensions of Globalisation


  • Capital
  • Labour
  • Products
  • Services
  • Information
• Capital flows


  The movement of money for the purpose of investment, trade or business production.
• Major capital flows occur between

  • Core regions (wealthier, developed countries that have power)
  • Periphery regions (less wealthy, developing/less developed countries that have less power)
  • The International Monetary Fund (IMF)
  • The World Bank
• Loan repayments also flow back from any countries receiving loans.
• Flows of labour


  The movement of people who move to work in another country. Essentially, this is migration that will contribute to the workforce.
• Today, 3-4% of the world's population are international migrants. The majority of migration is to high income countries (HICs) - only 1.6% of low income country populations are made up of international migrants.
• Migration within continents


  • Asia (63 million migrants, 1st)
  • Europe (41 million migrants, 2nd)
  • Africa (19 million migrants, 5th)
• Migration between continents


  • Latin America and Caribbean (LAC) to North America (26 million migrants, 3rd)
  • Asia to Europe (20 million migrants, 4th)
  • Asia to North America (17 million migrants, 6th)
• Highly skilled workers


  Highly trained in jobs that require a great deal of skill, such as in medicine, science, or ICT. They may move to high income countries as wages are higher for the same job than in lower income countries.
• Unskilled workers


  Those who are underqualified and do not possess 'expert knowledge' in their employment. They also move to developed countries for better wages and usually because of high unemployment rates in their countries. This can lead to overpopulation and exploitation, because many workers are still left in underpaid and often illegal work.
• Flows of products


  The movement of physical goods from one country to another. Globalisation has caused product flows to become international, meaning products are produced by a country and then transported to another country.
• Products used to be produced mainly in HICs as they had money to manufacture (factories, raw materials etc.)
• Products are now traded internationally due to technological advancements, such as better transportation and communication.
• A lot of production has relocated internationally (known as offshoring) especially to low income countries (LICs). These countries often have lower labour costs and reduced taxes, enhancing profits for companies.
• HICs import products from LICs, then sell them at much higher prices to make a profit.
• Emerging economies have increased the flows of consumer products to these countries, as there are more wealthy people.
• Flows of services


  Services are 'footloose' industries, meaning they can locate anywhere without constraints from resources or other obstacles. Services flow as they can be produced in a different country to where they are received (e.g. international call centres).
• Types of services


  • High level services (activities that generally require a higher skill level, meaning the person delivering the service should be qualified and trained, e.g. financial services)
  • Low level services (services that require less training, and are not as important to consumers, e.g. customer service based, especially call centres)
• Low level services are offshoring (moving overseas) in order to take advantage of lower labour costs. Offshoring has developed global connections and accelerated globalisation.
• Flows of information


  Any type of information can flow from one place to another via the internet, SMS, phone calls etc. For example, international news.
• Purposes of information flows

  • Fast broadband and connections allows news and financial information to be transferred almost instantly, allowing people to be more informed about global current events
  • Social media has allowed people to communicate across countries, and allows people to experience other cultures, making people across the world more interconnected
  • Real time data and data transfers contribute to the 'knowledge economy' (quaternary industry)
  • Large databases and archives can be used for research and education
  • The ability to research allows people to seek better employment opportunities, creating more global connections and allowing online, work-from-home jobs
• Global marketing


  Globalisation has allowed businesses to market (advertise, promote and sell) their products on an international scale. This has grown many businesses due to increased recognition and profit.
• Awareness of the brand

  When a brand creates a trademark (a legally registered representation, such as a logo) it can be easily recognised by consumers. A familiar brand is more likely to sell as they are chosen over less well-known competing brands. By keeping this trademark worldwide, consumers in other countries are likely to recognise the brand and trust it.
• American brands such as Apple, Coca Cola, and Nike have developed a global awareness of their brand, and are internationally well known. Buyers may assume their success and popularity equates to a good product, so the familiar brands are seen as trustworthy and continue to grow.
• Keeping the same strategy

  To make any changes to a marketing campaign will be costly, e.g. the costs for employment. Global marketing campaigns usually only need to change the language in order to promote their product, but sometimes a marketing campaign may need changed in order to respect cultural differences, such as religion or preferences.
• Developed markets dominate the global exports in manufactured goods, especially the EU and the US.
• HICs with developed markets dominate automotive products, steel and iron, and agricultural products.
• Middle-Eastern emerging economies are large contributors to the oil industry. Russia, Saudi Arabia, UAE, and Qatar are all in the top 10 exporters of fuel and mining products.
• The textile and clothing industry are concentrated within emerging economies and LICs, especially in Asian regions. China is the world's biggest exporter of textiles and clothing.
• Consumer technology (specifically office and telecom equipment) exports are concentrated in emerging economies. China makes up a third of the entire market - the amount of office equipment produced in these regions is likely due to the cheap labour prices, and ability to make and ship products in bulk.
• In general, HICs consume manufactured products more than LICs. This is because there is a lot less demand for goods in LICs. In developing economies, there is a demand for fuel and minerals due to the rapid industrialisation in these economies, especially Brazil, China, and India.
• In the least developed countries, imports are low. Chad and the Democratic Republic of Congo, and two former Soviet states – Georgia and Uzbekistan - import medical supplies more than any other country.
• Global financial system


  Globalisation has created a global financial system, incorporating thousands of institutions and banks; borrowing/investing relationships occur internationally as well as nationally. The global financial system accelerates globalisation as it makes the world more connected. Banks are now large global institutions that work with millions of people's money. Countries/companies can invest/lend millions in huge financial institutions like the World Bank.
• Financial technologies


  Financial technology has made financial information and money easily accessible for people across the world, deepening the connections between countries. This includes communication technology allowing global banking, the internet enabling money transfers, and the development of cryptocurrency.
• Transport technologies, systems and relationships

  Innovations in transport have made it easier to transport goods and people faster and in larger quantities. High speed rail, and faster and bigger planes and boats have allowed the world to become more connected and globalised through these connections.
• Internet


  A type of financial technology that allows people to transfer money, for buying/selling products, remittances, or investments
• Cryptocurrency


  Encrypted digital currency that has created a whole new market for online currency and trading