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What is gloablization?
The shift towards a more integrated and interdependent world economy-ex: global financial crisis
What are the first component of globalization?
-Globalization of markets: opening markets-the merging of distinctly separate national markets into a global marketplace=tastes and preferences converge onto a global norm (ex: McDonalds)=firms...
What is the second component of globalization?
-Globalization of production:-refers to sourcing of goods and services from locations around the world to take advantage of the differences in cost or quality of the factors of production...
What has globalization created the need for?
-created need for global institutions to help manage, regulate, and police the global marketplace (GATT, WTO, IMF, World Bank, United Nations)
What macro factors drive globalization?
-decline in trade barriers-technological change