MEDCs vs LEDCs: Globalization's Impact on Trade and Development

More Economically Developed Countries (MEDCs)

(Australia, France...)

• High life expectancy
• Exporting of manufactured goods
• Compulsory secondary education
• Low birth rate
• High status for women
• High employment in the tertiary sector
• High number of older people

Less Economically Developed Countries (LEDCs)

(India...)

• Poor healthcare
• Exporting of mainly primary products
• High infant mortality rate
• Low life expectancy
• Low literacy rates
• High employment rate in the primary sector
• High proportion of young people
• Limited access to clean water

Globalization: Different Aspects

Politics

• Global problems: Financial crises, climate change, terrorism
• Global actors: European Union, G-20, United Nations, Non-Governmental Organizations (NGOs)

Economy

• Decrease in the cost of transporting products
• Liberalization of international trade
• Increase in multinational companies
• Increase in worldwide exports
• Increase in direct investment

Culture

• Global culture (Music, news, products...)
• Communication technology (TV, Internet, video, phones...)

Main Consequences of Globalization

• Improvement in technology
• Decrease in transport costs
• Increase in world trade
• More competition
• Decrease in the cost of communication facilitates the exchange of information
• Easier to avoid taxes

Positive Aspects of Globalization (+)

• Increases awareness of global events
• Decreases human rights abuses and helps NGOs to raise money and increase international solidarity
• Medical advances for everyone
• Allows poorer countries and their citizens to develop economically and raise their standards of living
• Improvements in technology such as the internet give people more opportunities to learn and increase knowledge

Negative Aspects of Globalization (-)

• Transnational corporations (TNCs) may exploit people in poor countries by paying them less and providing poor working conditions
• Threatens cultural diversity, drowns out local cultures, traditions, and languages - western consumer culture is taking over
• Imbalance in economic relations between countries
• Climate change

Free Trade vs. Fair Trade

Developing Countries

Free Trade

• Bad working conditions
• Lower salaries
• Health problems
• Inequality

Fair Trade

• Better working conditions
• Fairer salaries
• Less use of pesticides and improved security
• Extra profits to invest in culture, school, medicine, etc.

Developed Countries

Free Trade

• Cheaper prices
• Big profits for companies

Fair Trade

• Better quality products