The process by which the world is becoming increasingly interconnected.
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History of globalization (NOTE!)
Old Empires
Darks Ages / Medieval Period
Renaissance / Enlightenment
Industrial Revolution
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Global culture?
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absolute and relative distance
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Time-space convergence
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Three factors for globalisation:
1 transportation technology:
all tools and machines that are used in the movement of people and goods
containerisation: standardised transport
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2 Information and communication technology
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3 free trade
trade barriers
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International division of labour
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www.bilaterals.org
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Transnational corporations
A transnational corporation (TNC) or multinational is a company with branches in more than one country.
TNCs increase globalisation by linking together countries through the sales of goods on the one hand and through the production of goods on the other.
This network of economic activities that covers all the steps to produce finished goods is called the supply chain.
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Supply chain
The production of goods can be split up in different steps:
- R&D (research and development)
- Manufacturing
- Distribution and sales
TNC's often choose to do some parts of the manufacturing process in other parts of the world e.g. Asia
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Stages of the supply chain
The supply chains of most goods will go through three different stages:
Raw materials.
Intermediate goods.
Final goods: these are goods that are directly used by consumers. Most final goods have been manufactured, which means they have been processed in a way. Examples are: sneakers, jeans, T-shirts, smartphones, notebooks, cars and so on.
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Offshoring = The relocation of parts of the supply chain from one country to another.
