Causes Of Globalisation

University:
London School of Economics and Political Science
Course:
L400 | International Social and Public Policy
Academic year:

2023
Views:

293

Pages:

1
Author:

Prerna T

2b) Analyze two causes of globalization (6 marks) On the whole, this question was done well. 4/6 average. The question discriminated between those who had revised and those who had not. Coming up with these reasons was not difficult. Another issue was gaining over 2 marks for your explanation. To hit 3 marks for explanation, one needs to explain ALL causal links and/or include a diagram where possible. Really important to add a definition of globalization. This can help one gain an extra mark. E.g.: a) A reduction in tariffs. Due to WTO tariffs have fallen, this has increased imports in many countries, which are now cheaper and so increases the interdependence of the economies. Add and explain diagram. b) A fall in transport costs e.g. due to lower oil prices and cheap cost of flying. These will increase globalization as firms can now source products from countries with low unit labor costs and these will still be cheaper than sourcing them from home. Therefore results in global supply chains. Model Answer: Globalization of economies around the world can be illustrated as a reduction in tariffs. This can be illustrated in the diagram of container ships and the fact that now, large container ships can store for more goods than the old ships. This means that it is easier for firms to transport goods between countries and easier to quickly change markets where they may be more successful, which leads to the interconnection of economies. Another reason and the reduction of tariffs can be illustrated in the diagram below: [Diagram of a supply and demand curve with an increase in supply] This diagram shows that the imported goods in the economy have increased in order to sustain domestic demand. As a result, the range of consumer goods in the economy has increased. This has led to the interconnection of firms and globalization.