Economics - Nature of the Global Economy & Globalisation
NATUREOF THEGLOBAL ECONOMYANDGLOBALISATION
TH E GLOBAL ECONOMY
Trade inGoods and Services had grown rapidly increasing from 38%ofGWP in 1990 to 63% ofGWP in
2007.
GWP is now9 times the level in 1950 howeverthe volume ofworld trade has grown 33 times it’s 1950 level During times of economic downturns,the growth of globaltrade has contracted fasterthanworld economic output highlightingthe greater volatility oftrade compared toGWP.
Important developmentthat has contributed to these flows is the increased influenceof
Transnational Corporations.
Transnational Corporations: global companies that dominate global product and factor markets. TNCs haveproduction facilities in atleasttwo countries and are owned by residents of atleasttwo countries. Trade has also lifted in response to majortrade agreements: o World TradeOrganisation (WTO): is anorganisation of153 member countries that implements and advances globaltrade agreements and resolves trade disputes between nations. Established in 1995 o NorthAmerican Free TradeAgreement(NAFTA) o Associationof South EastNations (ASEAN) o EuropeanUnion (EU)
GROSS WORLD PRODUCT
GrossWorldProduct(GWP):the sum oftotal output of goods and services by all economics in the worldover a period oftime.
In the industrialisedworld the value ofwhat many countries buy and sellfrom overseas is greaterthan half ofthe country’s economic output
GLOBALISATION
Globalisation:the process ofincreased integration between different countries and economies and the increased impactofinternational influences on all aspects oflife and economic activity.
Involves layers ofinfluences in all directions
Majorindicators ofintegrationbetween economics include: o Internationaltrade flows o Internationalfinancialflows o International investmentflows and transfers oftechnology o The movement ofworkers between countriesEconomics SummaryNotes 2010 JamieKennedy ‐ 9 ‐
D:\Documents\School\SchoolWork\Economics\Economics
TH E GLOBAL ECONOMY
Trade inGoods and Services had grown rapidly increasing from 38%ofGWP in 1990 to 63% ofGWP in
2007.
GWP is now9 times the level in 1950 howeverthe volume ofworld trade has grown 33 times it’s 1950 level During times of economic downturns,the growth of globaltrade has contracted fasterthanworld economic output highlightingthe greater volatility oftrade compared toGWP.
Important developmentthat has contributed to these flows is the increased influenceof
Transnational Corporations.
Transnational Corporations: global companies that dominate global product and factor markets. TNCs haveproduction facilities in atleasttwo countries and are owned by residents of atleasttwo countries. Trade has also lifted in response to majortrade agreements: o World TradeOrganisation (WTO): is anorganisation of153 member countries that implements and advances globaltrade agreements and resolves trade disputes between nations. Established in 1995 o NorthAmerican Free TradeAgreement(NAFTA) o Associationof South EastNations (ASEAN) o EuropeanUnion (EU)
GROSS WORLD PRODUCT
GrossWorldProduct(GWP):the sum oftotal output of goods and services by all economics in the worldover a period oftime.
In the industrialisedworld the value ofwhat many countries buy and sellfrom overseas is greaterthan half ofthe country’s economic output
GLOBALISATION
Globalisation:the process ofincreased integration between different countries and economies and the increased impactofinternational influences on all aspects oflife and economic activity.
Involves layers ofinfluences in all directions
Majorindicators ofintegrationbetween economics include: o Internationaltrade flows o Internationalfinancialflows o International investmentflows and transfers oftechnology o The movement ofworkers between countriesEconomics SummaryNotes 2010 JamieKennedy ‐ 9 ‐
D:\Documents\School\SchoolWork\Economics\Economics