• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Explain the meaning of the term globalisation and identify its benefits and costs. How and why will it affect banks' staff, their owners, their depositors, and their borrowers?

Extracts from this document...


Explain the meaning of the term globalisation and identify its benefits and costs. How and why will it affect banks' staff, their owners, their depositors, and their borrowers? The meaning of the word globalisation has been explored by many scholars, leading to a strong controversy. Despite the existence of different views and theories on the term globalisation, there's a broad agreement that although globalisation may be a much debated topic, there's no argument from the view that we live in a period of globalisation. Globalisation refers to the ongoing global trend towards the freer flow of trade and investment across borders which results in integration of the international economy. This interdependence of buyers and sellers in countries around the world results due to a number of factors. Mainly the maturation of the Eurocurrency markets since the 1960s, desire by financial institutions to expand their lending and other activities outside geographic boundaries and desire to control balance sheet risk through Interest Rate Swaps and other financial swap agreements. ...read more.


Globalisation also leads to an increased liquidity of capital allowing investors in developed nations to invest in developing countries. Lastly, the immigration and emigration of people causes cultures and communities to spread all over the world which is a way of diversity being created. We should not underestimate the costs related to globalisation. I will now talk about them. Due to globalisation, there are more chances of economic disruptions in one country affecting other countries as they may be reliant on them for a certain commodity. Also there's a great risk of diseases being transmitted unintentionally between nations. Most importantly, there's a big chance of globalisation being violent in an attempt to preserve cultural heritage because multinationals may bring in their cultures and customs changing the historic culture in that country. There are more chances of civil war within developing countries and open war between developing countries as they compete for resources due to there being demand for a materialistic lifestyle and an attitude within the population that sees consumption as the path to prosperity. ...read more.


and governments are tempted to loosen domestic rules to gain advantage are focused on refining the rules on capital requirements, on increasing disclosure and on improving international cooperation (Vaitilingham,2006). So to conclude, it is clear that the world is becoming more and more globalised. Globalisation is a man made feature of our world and it is unlikely that it will stop or slow down in the foreseeable future. Globalisation may lead to a compression of the world and an intensification of consequences of the world as a whole but the benefits surely outweigh the costs as otherwise it would not have existed as long as it has. Globalisation is a process of interaction and integration among the people, companies, and the governments of different nations, a process driven by international trade and investment and aided by information technology; this process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well being in societies around the world. 972 words. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level UK, European & Global Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level UK, European & Global Economics essays

  1. Marked by a teacher

    Advantages and disadvantages of Globalisation. Need for development.

    4 star(s)

    This slash and burn approach can abandon an area and leave it derelict. Thus the power of western multinationals can bring instability to a poor LDC. MNCs may damage the local environment, especially if the country's government is weak and has few regulations.

  2. Marked by a teacher

    What is an international bank? How do international banks compete?

    4 star(s)

    The only difference is that in international banking it happens across national boundaries. Therefore foreign exchange risk and foreign-country risk has to be taken into consideration. Eurocurrency market is made of banks which accept deposits and extend credits in currencies other than the currency of the country they are located in.

  1. Where does the World Trade Organisation fit in the overall scheme of international public ...

    Fifth Session of the Ministerial Conference on the basis of a decision to be taken, by explicit consensus, at that Session on modalities of negotiations".79 The EU and the US sometimes seem to regard these negotiations as pre-programmed, but that is not the impression of India and perhaps other developing countries.

  2. Corruption and Globalisation - Both of them have been so pervasive in recent years. ...

    If anything, corruption typically erodes the domestic tax base. (Wei, 2001) Developing countries are eager to attract FDI in order to grow; one of the methods is that offering low tax to attract foreign companies. When corruption exists, the "tax" for foreign companies will as a result increase. Shang-Jin Wei suggests that reducing corruption could in fact be more effective in achieving FDI growth, without sacrificing government revenues.

  1. Why has GDP growth been so slow in Somalia?

    This means that she can only get a job doing basic tasks such as cutting crops for a local farmer. This leads to primary product dependency within Somalia, which will remain detrimental to the country as long as the dependency theory exists.

  2. To what extent has globalisation been benefical to China's economic growth?

    Table 3: China- Simple and Trade-Weighted Statutory Tariffs5 (Percentage) All Products Primary Products Manufactures Simple Weighted Simple Weighted Simple Weighted 1992 42.9 40.6 36.2 22.3 44.6 46.5 1996 23.6 22.6 25.4 20.0 23.1 23.2 2001 16.6 12.0 21.6 17.7 16.2 13.0 After joining the WTO 9.8 6.8 13.2 3.6 9.5

  1. The Benefits of Trade

    Counter Claim Keynes denies 'there is an invisible hand channelling the self-centred action of an individual' (Samuelson, p151) Evidence to support Claim First, 'too much competition and too little cooperation' can cause further inequality amongst individuals (Soros in Reisman, 2004)

  2. To what extent has globalisation created a 'borderless world'?

    Many businesses base their strategic decisions on the global market rather than the national market. For example, a business may make parts for a product in several different countries, and assemble them in another because this is the most cost effective and efficient method to get the product to its consumer.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work