Just for you: FREE 60-day trial to the world’s largest digital library.
The SlideShare family just got bigger. Enjoy access to millions of ebooks, audiobooks, magazines, and more from Scribd.
Read free for 60 days
Cancel anytime.
The shirt toward a more integrated and interdependent world economy.
Globalization
Refers to the merging of historically distinct and separate national markets into one huge global marketplace.
Globalization of markets
The sourcing of
goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labor, energetic land, and capital)
Globalization of production
Trend by
individual firms to disperse parts of their productive processes to different locations around the globe to take advantage of differences in cost and quality of factors of production
Globalization of production
Inputs into the
productive process of a firm, including labor, management, land, capital, and technological know-how
Factors of production
Trend away from distinct national economic units and toward one huge global market
Globalization
Moving away from an economic system in which national markets are distinct entities, isolated by trade barriers and barriers of distance, time, and culture, and toward a system in which national markets are merging into one global market
Globalization of markets
As business activities blur national borders, what is needed to police the global marketplace?
Global institutions
Which institution was the predecessor to the World Trade Organization (WTO)?
General Agreement on Tariffs and Trade (GATT)
Which institution was created to maintain order in the international monetary system
International Monetary Fund
Which
global institution was established on October 24, 1945 and today one of its key purposes is to maintain international peace and security?
United Nations
This represents 90% of the global GDP and is comprised of representatives
of the 19 largest economies. It was established to formulate financial crisis policy in developing nations.
G20
The globalization of markets can be defined as
Bringing traditionally separate national markets into one cohesive marketplace
Bringing traditionally separate national markets into one cohesive marketplace
Globalization of markets
Two facets of globalization
Globalization of production
Globalization of markets
Result of high tariffs on imports of manufactured goods
Countries raised the trade barriers against each other
We have witnessed the globalization of
markets and productions for how long
Over the past three decades
This implies that national markets are merging into one huge marketplace. However, it is important not to push this view too far
Globalization of markets
This implies that firms are basing individual productive activities at the optimal world locations for the particular activities. As a consequence, it is increasingly irrelevant to talk about American products, Japanese
products, or German products because they are being replaced by "global" products.
Globalization of production
What two factors seek to underlie the trend toward globalization?
Declining trade barriers and changes in communication, information, and transportation technologies
Which term best describes the merging of historically distinct?
Term. Globalization of markets. Definition. Merging of historically distinct and separate national markets into one huge global marketplace.
What is meant by globalization of markets?
Globalization of markets involves the growing interdependency among. the economies of the world; multinational nature of sourcing, manufacturing, trading, and investment activities; increasing frequency of cross-border.
What is the Globalisation of production?
Production globalization, which is when firms expand their supply chains across national boundaries, creates an opportunity for developing countries to engage in international production networks via trade.
What is driving the move toward greater globalization?
Two macro factors driving the move toward greater globalization: 1.declining trade and investment barriers. 2.technological change. International Trade. occurs when a firm exports goods or services to consumers in another country.