TNCs and globalisation Flashcards Preview

A level Geography - Development and Globalisation > TNCs and globalisation > Flashcards

Flashcards in TNCs and globalisation Deck (5)
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1
Q

How can TNCs globalise their manufacturing operations?

A
  1. Producing just in the plant country.
  2. Producing for multiple countries e.g. Honda.
  3. Integrating production - each plant performs separate parts of a process.
    Vertical integration - linkage across national boundaries.
    Horizontal linkage - parts are moved to a final assembly plant in one country.
2
Q

What are external economies of scale (agglomeration economies, and what can they be categorised into?

A

Firms locate near one another together in cities/clusters.
TNCs may encourage such concentrations.
1. Localisation economies.
2. Urbanisation economies.

3
Q

What are localisation economies?

A

Firms linked by the purchase of materials/finished goods locate close together.
Reduces transport costs.
Faster delivery times: just-in-time deliveries.
Better communication.

4
Q

What are urbanisation economies?

A

Cost savings from urban locations.
Enables linkages between manufacturing and services.
Savings from economic/social infrastructure of an area that exists beforehand.

5
Q

How has there been a shift of investment towards service industries? 4

A
  1. Account for largest FDI share in many countries.
  2. Continuous liberalisation/deregulation process of key services has led to a big FDI inflow.
  3. Growing number of TNCs in service sector.
    E.g. 20 largest TNCs, 6 were service providers e.g. AXA.
  4. ICT revolution - overseas investment.
    Better/cheaper communication.
    Able to split services - more efficient.