Global Interactions (HL Extension): Power, Flows, Development, Risk
Power and networks
The HL extension has four units: global interactions and global power; global networks and flows; human development and diversity; global risks and resilience. It rewards precise theory and the ability to trace a flow from origin to beneficiary.
- Power: hard power coerces (military, economic sanctions); soft power attracts through culture, values and policy (Nye). Hegemony describes dominance across several dimensions at once.
- Flows: trade, FDI, remittances, outsourcing (contracting to a third party) versus offshoring (relocating abroad), containerisation and global production networks. Value is captured unevenly along the chain, so 'who makes it' and 'who profits' are different questions.
- Development: HDI combines life expectancy, mean and expected years of schooling, and GNI per capita (PPP). The Gender Inequality Index measures disadvantage in health, empowerment and the labour market.
- Risk: risk = hazard × vulnerability; resilience is the capacity to absorb a shock and reorganise.
Worked example
A country exports $320bn, imports $280bn, GDP $1,000bn. Trade-to-GDP = (320 + 280) ÷ 1,000 × 100 = 60%. Reasoning: this measures openness, not benefit. Entrepôt economies such as Singapore or the Netherlands score very high through re-exports of goods they did not produce, and the ratio says nothing about who keeps the value added - that needs commodity-chain evidence.
Traps
Using GDP and GNI interchangeably (GNI counts income residents earn abroad; GDP does not). Listing HDI's education component as 'literacy rate' - it is years of schooling. Equating globalisation with homogenisation when glocalisation is common. Assuming FDI automatically develops the host economy.