Adoption of globalization


The adoption of globalisation can be looked at and compared at many different scales include:
  • International
  • Regional i.e. a continent
  • National i.e. within a country
  • Settlement i.e. different areas within a settlement
  • Urban v rural

The adoption of globalisation can be impacted by a number of factors including:
  • Population and market size (threshold population): Many products require a minimum population for them to be offered. If a country or region only has a small population, then less products (especially global brands) will be offered. For example a Starbucks restaurant is not going to open in a small village in the Sahel where most people are mainly subsistence farmers.
  • Government policy and ideology: Some countries like Cuba and North Korea follow Communist ideologies which tend to prevent private ownership and increase self sufficiency. Both of these factors can create a more isolated and less globalised country. On the other hand countries like the US actively follow Capitalist policies which tends to increase globalisation.
  • Levels of communication (internet, mobile network): Many aspects of globalisation e.g. TV, film, the internet require certain levels of communications. If the infrastructure is not present then not only will less products will be offered, but also less advertised and heard about. For example Walmart are not going to start offering online shopping in the Amazon Rainforest where no one has access to the internet and there are poor transport links.
  • Education level: Areas that have high levels of education tend to be more globalised. This is because global companies have access to better workers, people are likely to have better jobs and therefore more disposable income and are more likely to have heard about global products.
  • Electricity and Water: Many global companies require reliable water and electricity. A global company is less likely to open if they are constantly suffering from power cuts which might impact production or having to purchase bottles water because of a dirty and unreliable supply of water.
  • Level of development: If a country is relatively poor (near the bottom of the Rostow or Clark model) then people will have smaller disposable incomes so less globalised products and services will be offered. For example in Sierra Leone where GDP per capita is very low, few global brands like Startbucks, GAP or Walmart will be offered.
  • Safety: Countries that are suffering from war or that have high levels of crime (robbery, murder, extortion), etc. will find it hard to attract foreign companies to invest.
  • Sanctions: Countries like Iran, Cuba and North Korea which either have sanctions or embargoes imposed upon them are less likely to be globalised because many global companies will be banned from trading with them.
  • Start up costs: Countries with a lot of regulations and laws (red tape) are going to be less attractive to global companies because it will increase start up costs. Also countries with expensive, land, rent, etc. are going to be less attractive.
  • Taxation and protectionism: Some global brands will choose not to locate in countries or regions with very high levels of taxation. This is because it is harder for them to be profitable. In order for them to be profitable their products may be so expensive that they become unattractive. Also countries that have high levels of protectionism e.g. tariffs and quotas are going to be less attractive to global companies.
  • Availability of raw materials: Some global products may not be offered because of a lack of local resources/raw materials. This is less of a problem in our modern globalised world with better transport, but if a supermarket is having to import all of its products it will find it hard to be competitive and profitable and therefore less likely to open.
  • Protests: Some countries may boycott or protest against certain products. For example in Iraq and Afghanistan the local populations may boycott certain US global products because they are unhappy with the ongoing occupation.
  • Local culture: Certain products maybe unacceptable to certain cultures. For example alcohol, lingerie and betting companies are much less likely to be operating in Muslim countries because they are all Haram.
  • Corruption (Kleptocratic governments): Global brands are unlikely or less likely to locate in countries with high levels of corruption. Afghanistan is meant to be one of the most corrupt countries in the world where bribes are common place, making for a less attractive business environment.

Below are the 15 most and least globalised countries according to the KOF index. Remember from the first section of global interactions (Measuring global interactions) KOF measure a number of economic, social and political factors to determine how globalised a country is.

TOP FIFTEEN MOST GLOBALISED COUNTRIES (KOF Globalisation Index)

BOTTOM FIFTEEN MOST GLOBALISED COUNTRIES (KOF Globalisation Index)

1. Belgium
2. Ireland
3. Netherlands
4. Austria
5. Singapore
6. Sweden
7. Denmark
8. Hungary
9. Portugal
10. Switzerland
11. Cyprus
12. Luxembourg
13. Czech Republic
14. United Kingdom
15. Canada
173. Central African Republic
174. Burundi
175. Sao Tome and Principe
176. Myanmar
177. Liberia
178. West Bank and Gaza Strip (Palestine)
179. Comoros
180. Afghanistan
181. Bhutan
182. Eritrea
183. Solomon Islands
184. Lao PDR
185. Equatorial Guinea
186. Kiribati
187. Timor-Leste


Below are some of the characteristics you may expect to find in a globalised city and a less globalised city.

CORE CHARACTERISTICS e.g. Belgium (Brussels)

PERIPHERY CHARACTERISTICS e.g. Eritrea (Asmara)

  • Good transport links e.g. International airport, Eurostar, good roads, usually a subway system
  • Good communication networks e.g. broadband internet, mobile phone coverage
  • Reliable electricity, gas and water supplies
  • Large tertiary sector (73% of workers are in the tertiary employment)
  • High GDP per capita ($37600 in 2011)
  • Usually urban areas with net-migration gain (urbanisation) - 'brain gain'
  • High levels of education and healthcare
  • High levels of FDI
  • High levels of employment
  • Good quality housing and accommodation
  • Large numbers of tourists
  • Cultural diversity (sport, music, religion, language, etc.)
  • Large racial mix
  • Poor transport and communication links. Probably no major airport or airline, poor roads and lack of public transport
  • Very low GDP per capita ($700 in 2011)
  • Large primary sector (80% of workers work in the primary sector)
  • Often rural areas and/or areas that are suffering from net migration loss - 'brain drain'
  • Poor levels of education and healthcare
  • Unreliable electricity and water supplies
  • Disinvestment and low levels of FDI
  • High levels of unemployment and underemployment
  • Poor quality housing (possibly informal)
  • Traditional society
  • Lack of cultural and leisure facilities
All facts taken from: https://www.cia.gov/library/publications/the-world-factbook/.

Within cities you may find areas that are more or less globalised. Below are some reasons why migrant areas may be more or less globalised.

WHY ARE IMMIGRANT AREAS MORE GLOBALISED

WHY ARE IMMIGRANT AREAS LESS GLOBALISED

  • Introduction of foreign foods e.g. many cities now have "China Towns"
  • Increased links to friends and families living abroad
  • Financial flows between countries (remittances)
  • Increased variety of culture e.g. sport, music, dance
  • Greater variety of languages spoken
  • An increase in the number of satellite channels
  • Development of local (foreign) businesses maybe offering new and varied products
  • High concentration of only one language (immigrant language)
  • High concentration of a certain religion and religious buildings
  • Less global brands. Maybe because the products are unwanted or because of the low socio-economic status of the area
  • Lower socio-economic status so lower disposable income and therefore less likelihood of services like the cinema, theatre being offered
  • Less disposable income might mean there is less access to broadband and mobile networks
  • There may be less variety of sports, music, dance, food, etc.

POSITIVES OF GLOBALISATION

NEGATIVES OF GLOBALISATION

  • Increase choice of products
  • Reduced shortages as products can be imported
  • Possibly reduced price of products as countries can specialise in products that they have a competitive advantage in
  • Increased multiculturalism (different foods, languages, music, dance, etc.)
  • Increased trading links and improved relations between countries reducing conflict because of interdependence.
  • Improved levels of technology as the latest products are shared
  • Increased levels of education and skills as people are trained or educated by foreign companies and institutions
  • Increased spread of democracy and human rights (greater quality between different groups and nationalities)
  • Improved medical care as advances in medicine can be shared
  • An increase in the number of clone towns (homogenisation of urban landscapes)
  • A loss of local companies
  • Global companies may actually become monopolies reducing choice or increasing prices
  • Workers and/or resources may be exploited by TNCs or foreign countries
  • Cultural dilution (homogenisation). Loss of individual culture e.g. language and food to be replaced by a more international culture (Westernisation?)
  • Possible racial tensions between migrant groups
  • Changes in diet e.g. more fast food leading to obesity
  • Economic leakage (profits disappear overseas to TNC headquarters)
  • Increased dependency of TNCs and foreign countries
  • Increased risk of economic problems due to global recessions
  • Possible environmental damage caused to poorer regions and nations
  • National sovereignty removed by global institutions like the IMF, WTO and EU