Globalisation on Developing Economies

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Discuss the impact of globalisation on developing economies (20) Globalisation is about the processes that have resulted in ever closer links between the world’s economies. Expressed in a more simple way this means developing economies developing closer links through things like trade, investment, production and then in more recent times, migration of people and transfer of technology. In recent years the speed that globalisation is growing at has increased massively and the impact is seen most greatly on developing economies. The two main characteristics of globalisation are global brands and global sourcing. Global branding involves one brand being available in most international markets. Examples of global brands include McDonalds and coca-cola. Even though the price charged in each economy may be different, the product will be almost identical in every country. Global sourcing on the other hand is more about ways in which global companies produce on a worldwide scale. In this way, domestic producing becomes replaced by investing in capital on an international scale. Examples of global sourcing can be seen by the actions of Nike and Toyota. Both global branding and global sourcing have their positives and negatives on developing economies. The obvious benefit of global branding is about the improvement of competition, choice and price of products available in economies. When a country is developing, when more products become available on the market, standards of living may increase within the country. If price is driven down by importing goods then more money will flow through the economy in the form of consumer expenditure. If there is more choice, it drives domestic producers to try and compete at the same level and thus improving the quality of their goods to match the ones imported from abroad. If the products are to do with medical practices, it may improve the growth of the growing economy dramatically as life expectancy can increase as more medicines...
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