Shrinking World

Impacts

Economic

Political

Social

Influence of TNCs has increased globally and have higher incomes than some GDPs.

Stocks being traded between countries has lead to increased FDI, especially to developing nations.

Americanisation and Westernisation has lead to a loss of cultural diversity.

Trade blocs have become more influential and reduced tarrifs.

International migration has led to extensive family networks living across the globe

IGOs work to harmonise economies

History

Global transactions of money.

Social media has revolutionised how humans connect and communicate.

19th & 20th Centuries

21st Century

Steam power:
In the 1800s, Britain was leading the world through using steam-powered technology.

GSP:
Allows goods and people to be tracked, especially useful for large TNCs.

Jet aircraft:
More efficient for good and people to travel across the world.

Containerisation:
There are more than 200 million container movements each year, which is vital to the global economy.

Fibre optics & internet:
Faster and larger transfer of data, opinions and ideas can be shared globally.

Telephones:
Smartphones have allowed for better communication between people.

Key Players

IGOs

National Governments

IMF:

  • Loans money to developing nations
  • Country must open markets from government control
  • Can lead to debt caused by privatisation
  • Debt can lead to lack of funding for healthcare, etc

World Bank:

  • Loans money to developing nations
  • Aims to improve development and increase globalisation
  • Can lead to debt and limit government sovereignty

WTO:

  • Aims to liberalise trade
  • Removes tariffs and subsidies
  • Unsuccessful at allowing equal opportunities for trade

Privatisation:
Private companies bought and ran state-owned industries.

Censorship:
Government controlled restrictions on internet access and media.

Limiting migration:
A rise in right-wing views means stricter migration regulations.

Business start-ups:
Grants and tax breaks are available to businesses to encourage them to move to certain areas.

Trade Blocs

Costs

Benefits

Examples

Businesses have a larger potential market.

Raw materials, outsourcing, and skilled workers are easier to access and move around.

Importing of essential services and goods is more reliable.

Outside countries become excluded from trading opportunities.

Foreign industries can be directly damaged.

Trade blocs don't guarantee good relationships between member countries.

NAFTA:

  • Canada, Mexico, and USA
  • Established 1994

EU:

  • 27 European countries (ie. France)
  • Established 1993

ASEAN:

  • 10 member countries (ie. Thailand)
  • Established 1967

MERCOSUR:

  • 4 full members (Argentina, Brazil, Paraguay, and Uruguay)
  • 7 associated countries
  • Venezuela has been suspended since 2016
  • Established 1991