Global production network A global production network refers to the interconnected processes and activities involved in the production of goods and services across multiple countries It includes the sourcing of raw materials manufacturing assembly and distribution often involving various firms and suppliers GPNs illustrate how global supply chains operate highlighting the relationships between different actors and the geographic dispersion of production activities Uneven development uneven development describes the disparities in economic growth and development levels across different regions or countries This concept recognizes that globalization and economic policies can lead to significant variations in wealth infrastructure and access to resources While some areas may experience rapid growth and prosperity others may remain stagnant or even decline resulting in inequalities both within and between nations Territorial embeddedness localization Territorial embeddedness or localization refers to the extent to which economic activities and social practices are rooted in specific geographical areas This concept emphasizes the importance of local context including cultural social and institutional factors in shaping economic processes It suggests that businesses and industries are influenced by their surroundings leading to variations in practices and outcomes based on local conditions Scale In economic and geographical contexts scale refers to the level at which analysis is conducted which can range from local to global It encompasses various dimensions including spatial scale how geographical areas are defined temporal scale timeframes of analysis and organizational scale size of firms or institutions Understanding scale is crucial for analysing processes like globalization as effects and interactions can differ significantly depending on the level of analysis used Job dislocation Job dislocation is when people lose their jobs or have to change jobs because of economic changes or new technologies Pollution haven effect The pollution haven effect happens when companies move to countries with weaker environmental laws to avoid costs leading to more pollution in those places California effect aka the trading up effect or the EU effect The California effect or trading up effect refers to when strict environmental or labor rules in places like California or the EU encourage other regions to adopt similar standards to compete in the market National sovereignty National sovereignty is a country s right to make its own laws and decisions without outside interference The Washington Consensus The Washington Consensus is a set of economic advice for developing countries that promotes free markets cutting government spending and privatizing state owned businesses to encourage growth International division of labor The international division of labor means that different countries specialize in producing certain goods or services based on their strengths leading to global trade Core periphery system The core periphery system describes how wealth and resources are concentrated in core developed regions while peripheral developing regions are less developed and dependent on the core Protectionism Protectionism is when a government uses rules like tariffs and quotas to protect its own industries from foreign competition 1 Deregulation Deregulation is the process of removing government rules and restrictions from an industry to promote competition and efficiency Securitization Securitization is turning assets like loans into financial securities that can be sold to investors making it easier for companies to raise money Privatization Privatization is when the government sells its ownership of a public service or asset to private companies or individuals Eurobond A Eurobond is a type of bond issued in a currency not native to the country where it is sold typically used for international investments Foreign bond A foreign bond is a bond issued by a foreign company or government and sold to investors in another country usually in the local currency Arbitrage Arbitrage is the practice of buying and selling the same asset in different markets to profit from price differences Speculation Speculation involves making high risk investments with the hope of earning a profit based on future price changes Countertrade Countertrade is a type of trade where goods and services are exchanged directly for other goods and services rather than using cash Hedging Hedging is a strategy used to reduce risk by making investments that will offset potential losses in another investment Law of one price The law of one price states that in an efficient market identical goods should sell for the same price when expressed in a common currency after adjusting for transportation costs Purchasing power parity PPP Purchasing power parity PPP is an economic theory that suggests that in the long run exchange rates should adjust so that identical goods cost the same in different countries Inflation Inflation is the rate at which prices for goods and services rise eroding purchasing power over time The Gold Standard The Gold Standard is a system where a country s currency value is directly linked to gold meaning that money could be exchanged for a specific amount of gold The Bretton Woods Agreement The Bretton Woods Agreement was a 1944 international agreement that established fixed exchange rates between major currencies and created institutions like the World Bank and the IMF to promote global economic stability The World Bank The World Bank is an international organization that provides loans and grants to countries for development projects aimed at reducing poverty and promoting economic growth The International Monetary Fund The IMF is an international organization that provides financial assistance and advice to countries facing economic difficulties helping to stabilize their economies and promote global trade 2 Managed float monetary system A managed float monetary system is a type of exchange rate system where a country s currency value is primarily determined by the market but can be adjusted by the government or central bank when necessary Monetary policy Monetary policy refers to the actions taken by a country s central bank to control the money supply and interest rates to influence the economy Fiscal policy Fiscal policy involves government decisions about spending and taxation to influence the economy often aimed