The Global Economy - created from Mind Map

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International Economic Integration

Gross World Product

The Global Economy

Globalisation

Financial Flows

The International and Regional Business Cycle

AKA Aggregate Value

Total Output of G & S of all economies

Ripple Effect

International Division of Labour

Technology, Transport and Communication

Investment and TNC

Increased Trade in Goods and Services

high income economies attract highly skilled workers

Barriers include: Immigration restrictions, language, culture, incompatible education

search for most efficient and costless

Technology ultimate driver

transport = less time, money, efficiency

transfer money globally

TNC's include: Shell, Toyota,

Foreign Direct Investment

Portfolio Investment

Mergers and Acquisitions: Microsoft and Skype

global investment

Approx. 20% of investment

>10% in firm

Long-term

Global Finance

Short- Term

more volatile than GWP

Trade Flows changed to South/ East Asia

ATM: vehicles, clothing, electrical goods.

Contracts faster in downturns

Forecast: finance and communication, services, oil, gas.

Most Globalised Feature

Deregulation 70's/80's

FOREX turnover $4Trillion, 2011.

Speculators create excessive volability

63% of changes in level of output in Aust. linked to changes of interest rates, growth and inflation of G7

Cross-border integration

regional economies are integrates

Factors weakening the international business cycle: interest rates, fiscal policies, exchange rates, structural factors, regional factors.

Factors strengthening the international business cycle: Trade flows, Investment flows, TNCs, financial flows, financial market and confidence, global interest rates, commodity prices, international organisations.

USA, Canada, Mexico

East Asia, Australia

The Global Economy