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

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

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

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

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

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