Using Items A and B and your own economic knowledge, discuss whether increasing globalisation is beneficial for people in less economically developed countries.

Justify your answer.

This high-mark question requires a balanced evaluation of globalisation's impact on LEDCs. **Potential Benefits:** - **FDI and Job Creation:** As Item B states, MNCs create jobs, which can be a route out of poverty. - **Technology and Skills Transfer:** MNCs bring modern production techniques and train the local workforce. - **Increased Exports:** Free trade (Item A) allows LEDCs to access richer markets, boosting their export revenues. - **Economies of Scale:** Specialisation and trade allow for greater efficiency. - **Consumer Benefits:** Access to a wider variety of cheaper imported goods. **Potential Drawbacks:** - **Exploitation of Labour:** Low wages, poor working conditions, use of child labour. - **Tax Avoidance:** As mentioned in Item B, MNCs may use transfer pricing and other schemes to avoid paying taxes in the host country, limiting government revenue for development. - **Environmental Damage:** MNCs may exploit lax environmental laws. - **Competition for Domestic Firms:** Small local firms may be driven out of business. - **Repatriation of Profits:** MNCs may send profits back to their home country rather than reinvesting them locally. A strong conclusion will not give a simple 'yes' or 'no' but will argue that the outcome is contingent on effective governance and regulation to harness the benefits and mitigate the costs.