Globalisation has affected some places and organisations more than others

Geographical Bias

•                    Measuring Globalisation*
  

Measuring Globalisation

The following indicators and indices can be used to measure levels of globalisation:

The KOF Index

• Economic globalisation - Cross border trade, investment in money and flows
• Social globalisation International telephone calls, tourist flows, resident foreign population and access to foreign internet, television, media and brands
• Political globalisation - Number of foreign embassies and international organisations the country is a member of, and trade and other agreements w/ foreign countries

AT Kearney Index

↳ Measures the economic success of global cities

The Role of TNCs in Globalisation

📌 Help to build connections between different nations thereby ↑ levels of globalisation

They have contributed to the spread of globalisation in the following ways:

• Global Production Networks: Extract raw materials in one country, refine them in another and make components in several different countries and assemble them in others ∴ incorporate and connect several different countries
• New Markets: Sell finished products to main markets in developed countries along w/ creating new markets in emerging countries

Countries using global branding and marketing

• Glocalisation: Change products to suit local cultures and tastes, perhaps due to religion or different regulations - global brands remain the same but adapt to meet local needs
• Liberal policies: Use economic liberalisation of countries to locate outsourcing and offshore operations

The following reasons result in some areas not benefiting from TNC FDI:

• Not all places are suitable sites of production for goods due to both physical and human factors 📝 (eg. lack of resources, government policies etc)
• Not all places have enough market potential to attract large retailers

Switched off Regions

Some places in the world still remain switched off from globalisation due to:

• Political isolation N Korea
  • Corrupt government or admin or disruption by crime & terrorism
  • National government not committed to free markets or making links w/ other countries
  • Civil or tribal conflicts within the country creates divisions
  • Inability to join trade blocs due to ethos differences, or disadvantaged by world trade rules
• Physical isolation Bhutan, Chad and Nepal
  • Long distance from economic core or markets ∴ discourages links like TNC
  • Wilderness areas create difficulties for survival or building and maintaining infrastructure
  • Low agricultural potential due to harsh climate or poor soils creates difficult living conditions
  • Lack of resources for energy or raw materials for businesses and industries so they cannot developing
• Economic isolation The Sahel Region
  • High level of government debt ↓ subsidies and spending on transport and communications
• Low education levels ↓ worker skills and the ability to communicate with other countries
• Poverty ↓ the ability of people and the country to invest in transport and telecommunications
• Dependence on one or few resources or industries creates disadvantages and exclusion