Changing Economies » Globalisation Definition and Features

What you'll learn this session

Study time: 30 minutes

The definition of globalisation and its key features
The main drivers of globalisation
Economic, social and environmental impacts of globalisation
Case studies of globalisation in action
How to analyse the advantages and disadvantages of globalisation

Introduction to Globalisation

Globalisation is one of the most significant processes shaping our modern world. It affects everything from the clothes we wear and the food we eat to the music we listen to and the jobs available in our communities. But what exactly is globalisation and why does it matter so much in geography?

Key Definitions:

Globalisation: The increasing connections between places and people across the planet, establishing a single global society through economic, technological, social, cultural, political and environmental changes.
Transnational Corporations (TNCs): Companies that operate in multiple countries, with headquarters typically in one country and production facilities in others.
Outsourcing: When a company moves part of its business operations to another country, usually to reduce costs.
Global shift: The movement of manufacturing from developed countries (like the UK) to developing countries (like China or Bangladesh).

🌐 Economic Features

Globalisation has created a world where goods, services and capital flow more freely between countries than ever before. This includes:

Growth in international trade
Rise of transnational corporations
Development of global financial markets
Increased economic interdependence between countries

📱 Technological Features

Technology has been both a driver and a feature of globalisation:

Internet and digital communication
Faster and cheaper transport
Containerisation revolutionising shipping
Global media networks

Drivers of Globalisation

Globalisation didn't just happen overnight. Several key factors have worked together to create our increasingly connected world:

💰 Economic Drivers

Free trade agreements and organisations like the World Trade Organization (WTO) have reduced barriers to international trade. Companies seek new markets and cheaper production locations to maximise profits.

📶 Communication

The internet, mobile phones and social media have created instant global communication. Information can now travel around the world in seconds, making international business and cultural exchange much easier.

🚨 Transport

Improvements in transport technology, particularly air travel and containerisation in shipping, have made moving goods and people around the world faster and cheaper than ever before.

The Role of Transnational Corporations (TNCs)

TNCs are major players in globalisation. These giant companies operate across national borders, often with their headquarters in wealthy countries and their factories in developing nations where costs are lower.

How TNCs Drive Globalisation

TNCs like Apple, Nike and Coca-Cola have enormous economic power and influence. They shape global trade patterns through their decisions about where to locate different parts of their business.

📈 Global Production Networks

Modern products are rarely made in just one place. Take the iPhone: designed in California, with components from Japan, Korea and Germany, assembled in China and sold worldwide. This global supply chain is a perfect example of globalisation in action.

💲 Economic Impact

TNCs bring jobs and investment to developing countries, but they can also exploit workers and avoid taxes. They often have more economic power than the countries they operate in, giving them significant influence over local governments.

Case Study Focus: Apple's Global Supply Chain

Apple is one of the world's most valuable companies, with products sold in over 100 countries. While Apple is headquartered in California, USA, its manufacturing is primarily outsourced to factories in China. The iPhone contains components from over 200 suppliers across 43 countries. This global approach allows Apple to access specialist expertise and lower labour costs around the world.

Key facts:

Foxconn, Apple's main manufacturing partner, employs over 1 million workers in China
Components come from Japan, South Korea, Taiwan, Europe and the USA
Apple's global approach has helped it become worth over $2 trillion
The company has faced criticism over working conditions in supplier factories

Impacts of Globalisation

Globalisation has far-reaching effects on economies, societies and environments around the world. These impacts can be both positive and negative and they often affect different groups of people in different ways.

📈 Economic Impacts

Positive: Economic growth, job creation, lower prices for consumers, technology transfer
Negative: Job losses in some sectors, growing inequality, economic vulnerability to global events

🏠 Social Impacts

Positive: Cultural exchange, improved living standards, access to global education and information
Negative: Cultural homogenisation, exploitation of workers, migration pressures

🌲 Environmental Impacts

Positive: Spread of environmental technologies, international cooperation on issues like climate change
Negative: Increased carbon emissions from transport, resource depletion, pollution in manufacturing hubs

Globalisation: Winners and Losers

Not everyone benefits equally from globalisation. Understanding who gains and who loses is crucial for analysing this complex process.

👍 Winners

Transnational corporations - Access to new markets and cheaper labour
Consumers - Greater choice and lower prices
Skilled workers - More job opportunities and higher wages
Emerging economies like China and India - Rapid economic growth

👎 Losers

Manufacturing workers in developed countries - Job losses due to outsourcing
Local businesses - Competition from powerful global companies
Factory workers in developing countries - Often poor working conditions
The environment - Increased pollution and resource use

Case Study Focus: Fast Fashion and Globalisation

The fast fashion industry perfectly illustrates the features and impacts of globalisation. Companies like H&M, Zara and Primark rely on global supply chains to produce cheap, trendy clothes quickly.

Key aspects:

Designs created in Europe, manufactured in countries like Bangladesh, Cambodia and Vietnam
Rapid transport networks allow new styles to reach shops within weeks
Digital marketing creates global demand for the same styles
The 2013 Rana Plaza factory collapse in Bangladesh (killing 1,134 workers) highlighted poor working conditions
Fast fashion creates significant environmental impacts through resource use and waste

This case study shows how globalisation connects consumers in wealthy countries with workers in developing nations, with both positive impacts (jobs and economic growth) and negative consequences (exploitation and environmental damage).

The Future of Globalisation

Globalisation continues to evolve. Recent events like the COVID-19 pandemic, trade tensions between major economies and growing concerns about climate change are reshaping how globalisation works.

Current Trends

Several important trends are affecting globalisation today:

Digital globalisation - Data flows and digital services becoming more important than physical goods
Reshoring - Some companies bringing production back to their home countries
Regional trade - Growth in trade between neighbouring countries rather than across the world
Sustainability concerns - Growing pressure to make global supply chains more environmentally friendly

Key Points to Remember

As you prepare for your iGCSE Geography exam, remember these essential points about globalisation:

Globalisation is the increasing interconnectedness of the world through economic, social, cultural and political processes
Key drivers include technology, transport and economic policies
Transnational corporations play a central role in shaping global production networks
Impacts are complex and varied, creating both winners and losers
Case studies like Apple and fast fashion help illustrate how globalisation works in practice
Globalisation continues to evolve in response to global events and challenges

Understanding globalisation is crucial for making sense of many other topics in your Geography course, from economic development to migration and environmental issues. The concepts you've learned here will help you analyse how our increasingly connected world functions.

🧠 Test Your Knowledge!