The Global Economy: Shifting Geographies & Interconnectedness

2. Global Shift Chapter 2 The Centre of Gravity Shifts: Transforming the Geographies of the Global Economy

3. Review • Concepts to Review • Globalization, economic geography • Key Words • Geographies of globalization, FDI, BRIC economies, volatility of economic growth, transnational corporations

4. Global Division of Labour • Over 300 years, a global division of labour developed, with a core–periphery configuration • Manufacturing concentrated in the core, with exports and imports to/from periphery • Second World War: destruction of extant manufacturing capacity, and development of new technologies • Post-war division • Capitalist ‘West’ dominated by the USA • Communist ‘East’ • ‘Third World’ • Post-Cold-War developments: the re-emergence of Asia as the world’s most dynamic economic region

5. Global Interconnectedness • Two important features of the global economy since 1950 • increased volatility of economic growth • growing interconnectedness • Current trends • Variation between countries in trade integration terms • Major indicator of growing interconnectedness: the fact that the growth of trade has outpaced the growth of output • Most trade is intra-regional, within the three major regions (Europe, North America, Asia), and most exterior trade is between them

6. FDI and TNCs • FDI • definition • importance of FDI to a country’s economy as a measure of integration • TNCs • definition • significance of intra-firm trade • Changing patterns of trade and investment

7. Regional Comparisons • USA • Europe • Eastern Europe • Asia • Latin America • World becoming increasingly multi-polar