ECON study guide - 1 Globalization A trend towards greater...

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1. Globalization A trend towards greater economic, cultural, political, and technological interdependence among national intuitions and economies. 2. Globalization of Markets Merging of historically distinct and separate markets into one huge global market place. 3. Main Benefits of Globalization of Markets New growth opportunities Levels uneven income streams Reduces marketing cost 4. Products with the most global markets are … Most global markets are NOT markets for consumer products. EX: Jeans must be tweaked if moving from country to country 5. Globalization of Production Dispersal of production activities to locations around the world to help.. 6. Main benefits of Globalization of Production Access to low cost workers 7. Two main forces driving globalization Falling barriers to trade Technological innovation 8. 9. 10. 11. 12. Regional Trading Blocs NAFTA MERCOSUR Andean Community ECOWAS ASEAN GCC 13. Trade agreements have:
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Significantly increased world trade and cross border investment International trade has grown more rapidly than world output 14. Relationship between globalization and international business Globalization of markets has INCREASED revenues Globalization of production has DECREASED costs Both result in INCREASED profits 15. Measuring Globalization (p. 14-15) Political engagement o Politics and institutions of politics Economic Integration o Involved WTO etc. Technological connectivity Personal contact o Personal travel 16. Globalization Debate Impact on jobs and wages Disadvantages 1. Eliminates jobs in developed nations 2. Forces wages lower in developed nations 3. Exploits workers in developing nations Advantages 1. Increases wealth and efficiency 2. Generates labor market flexibility 3. Creates newer jobs in developed countries Impact on Labor and Environments Disadvantages 1. Exploits workers in poor nations 2. Weakens protection of environment Advantages 1. Economic openness and foreign investment raises labor standards 2. “Open economies”- most environment friendly 3. Companies concerned for future markets Impact on Culture Disadvantages
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1. Destroys cultural diversity 2. Homogenizes our world 3. Bankrupt local businesses Advantages o Cultural exchange o Local cultural values and norms are retained 17. Ecuadorian Rose Case (a) Locate and label Ecuador on the South America outline map. Which
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