What are the advantages and disadvantages of globalisation in the UK
Economic restructuring:
Economic restructuring has happened because globalisation increases competition meaning the British economy has been restructured, largely at the expense of manufacturing.
This is because many British manufacturing firms have transferred production offshore.
This allows them to focus on high value and high skill activities such as research, product design/ development and marketing.
Foreign direct investment:
Investment into the UK through TNC’s is important as it transfers technology, skills and innovation to the UK.
FDI is particularly important in the UK’s automotive industry with 25% of Ford’s engines being sourced from Dagenham in Essex.
However, there is the issue that The British government has limited power to influence decisions made by foreign trans-national companies when it comes to them relocating and offshoring. This means thousands of people in the UK can face redundancy with the UK government having no power to stop it.
International migration:
International migration has benefitted us as migrants reduce the cost of low skill labour whilst also providing additional higher skills. They contribute significantly to our GDP as most migrants are of working age.
However, migration places enormous strains on public services and raises problems with social cohesion.
The main issues arising from globalisation in the UK:
1. Growth
Aggregate demand is likely to increase through increased exports and aggregate supply is likely to increase due to higher levels of investment.
However, growth in the short term may become more unstable as the global economy becomes increasingly interconnected.
2. Employment
Long term jobs in the manufacturing industry are destroyed and then new jobs are created in the service industry.
However this creates structural employment (there are too many people for the amount of job opportunities) widening the income gap.
3. Prices
Prices increase as we import food form all
Economic restructuring has happened because globalisation increases competition meaning the British economy has been restructured, largely at the expense of manufacturing.
This is because many British manufacturing firms have transferred production offshore.
This allows them to focus on high value and high skill activities such as research, product design/ development and marketing.
Foreign direct investment:
Investment into the UK through TNC’s is important as it transfers technology, skills and innovation to the UK.
FDI is particularly important in the UK’s automotive industry with 25% of Ford’s engines being sourced from Dagenham in Essex.
However, there is the issue that The British government has limited power to influence decisions made by foreign trans-national companies when it comes to them relocating and offshoring. This means thousands of people in the UK can face redundancy with the UK government having no power to stop it.
International migration:
International migration has benefitted us as migrants reduce the cost of low skill labour whilst also providing additional higher skills. They contribute significantly to our GDP as most migrants are of working age.
However, migration places enormous strains on public services and raises problems with social cohesion.
The main issues arising from globalisation in the UK:
1. Growth
Aggregate demand is likely to increase through increased exports and aggregate supply is likely to increase due to higher levels of investment.
However, growth in the short term may become more unstable as the global economy becomes increasingly interconnected.
2. Employment
Long term jobs in the manufacturing industry are destroyed and then new jobs are created in the service industry.
However this creates structural employment (there are too many people for the amount of job opportunities) widening the income gap.
3. Prices
Prices increase as we import food form all