Globalisation and TNCs » Impacts of Globalisation

Globalisation changes lives, for better and worse

Remember, globalisation is the increasing connection and interdependence of the world's countries. This lesson asks a different question: what difference does it make? The answer is that it helps some people and places and harms others. A good geographer never says "globalisation is good" or "globalisation is bad". They name the impact, say who it affects and explain why.

Key terms:

• Positive impact: an effect that brings a benefit.
• Negative impact: an effect that causes harm or a cost.
• Winners and losers: the people, groups or places that gain from a change, and those that lose out.
• Cultural loss: traditions, languages or ways of life fading as outside influences take over.
• Cultural fusion: different cultures mixing to create something new.
• Call centre: an office where staff answer customers' phone calls and messages for a company, often in another country.
• Remote work: doing a job from home or another place, using the internet, for an employer that may be in a different country.

Impacts on trade

Interdependence sits in the middle. It is positive because countries can get what they cannot make themselves. It is negative because a problem in one country spreads. In 2020 the COVID-19 pandemic disrupted factories, ports and shipping, and shops in many countries ran short of goods that were made far away.

Winners and losers: shoppers in HICs usually win, because goods are cheaper. Factory workers in LICs gain jobs and wages, but they may be paid low wages for long hours. Workers in HICs whose factories close because production moved abroad lose their jobs.

Impacts on transport

Trade needs moving. Globalisation has brought many more flights and far more shipping. Goods, workers, business people and tourists all travel further and more often.

• Positive (economic): faster, cheaper links mean goods and parts reach customers quickly, and ports and airports create jobs.
• Negative (environmental): planes, ships and lorries burn fuel, so more transport means more emissions and poorer air quality. This adds to climate change, and ships can pollute the sea and harm marine life.
• Negative (social): people living near busy ports, airports and roads suffer noise.

Impacts on culture

Culture means the way of life of a group of people: their food, music, clothes, language and beliefs. Globalisation spreads brands, music and food across the world, and it does so very quickly.

Impact	What happens	Positive or negative?
Spread of brands, music and food	Global brands appear in towns everywhere. Music from one country is streamed in another. Restaurants serve food from many countries.	Positive: more choice and new experiences. Negative: local shops and traditions struggle to compete.
Cultural loss	Young people copy global fashions and languages. Local languages, crafts and customs may fade.	Negative (social)
Cultural fusion	Ideas mix to make something new, such as a restaurant dish that blends two food traditions.	Positive (social)

Impacts on communications

The internet, mobile phones and social media let people share messages, photos and news with anyone, anywhere, almost instantly.

Impacts on technology

New technology, such as better machines, medicines and computer systems, now spreads between countries far faster than in the past. LICs can use technology that was first developed in HICs, so they do not have to invent everything themselves.

Two examples are linked to the key terms:

• Call centres: HIC companies often place call centres in countries such as India and the Philippines, where wages are lower and many people speak English. This brings jobs and income to the MIC or LIC. In the HIC, those jobs may be lost.
• Remote work: a person can work for a company in another country without moving. This gives workers in lower-cost places access to better-paid jobs. It can also mean competing with workers from all over the world for the same job.

Sorting the impacts

In the exam, you are often asked to sort impacts. Use these three groups.

Type	Question to ask	Example from this lesson
Social	Does it affect people's lives, health, culture or communities?	Cultural loss; noise near airports
Economic	Does it affect jobs, money, trade or businesses?	Jobs in call centres; cheaper goods
Environmental	Does it affect air, water, land or wildlife?	Emissions and poor air quality from flights and shipping

Impacts also depend on who and where. Globalisation can bring LICs jobs and investment, but it can also leave them dependent on richer countries and vulnerable to shocks. HICs gain cheap goods and big markets, but may lose jobs when work moves abroad. Within one country, the winners are often educated, urban and well connected, while the losers are often rural, poorer or in industries that cannot compete.

Exam-style question

Table 1 shows made-up data about Country K, an LIC where a foreign company opened a call centre ten years ago.

Year	Jobs in the call centre	Average monthly wage in the call centre ($)	Average monthly wage in farming ($)
Ten years ago	200	250	120
Now	4,000	400	150

(a) Identify the number of jobs in the call centre now. [1 mark]

(b) Calculate how much higher the call centre wage is than the farming wage now. [1 mark]

(c) Explain one negative impact of globalisation on communications or culture. [3 marks]

(d) To what extent does globalisation bring more benefits than problems to LICs? [6 marks]