Question 29May/June 20269708/311 mark
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Paper 3 multiple-choice questions and Paper 4 data-response/essay questions and case studies, retyped from the original Cambridge material; artwork and data tables are reproduced as images. Mark schemes show the official answer key and level-marked indicative content.
About Globalisation
Questions on globalisation: its causes and effects, trading blocs and free-trade areas, the World Trade Organization, and the costs and benefits for different countries.
32 past paper questions on this topic since 2020, across 11 exam sessions.
How often it comes up
| Year | Paper 3 | Paper 4 | Total | Chart |
|---|---|---|---|---|
| 2026 | 3 | 0 | 3 | |
| 2025 | 7 | 4 | 11 | |
| 2024 | 5 | 4 | 9 | |
| 2023 | 3 | 2 | 5 | |
| 2021 | 1 | 1 | 2 | |
| 2020 | 2 | 0 | 2 |
Every 2025–2026 question on Globalisation
The whole topic on one page, with answers and mark schemes. Printing this page prints just this list.
Paper 3 · Multiple choice (10)
Question 30May/June 20269708/341 mark
The African Union (AU) consists of 55 countries of Africa, but only 18% of total trade of the AU is between countries in Africa. If the AU decides to co-operate on trade policy, what would make the greatest change to this situation?
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Question 25Feb/March 20269708/321 mark
What is likely to be found in a free trade area?
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Question 27Oct/Nov 20259708/311 mark
What occurs in a monetary union?
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Question 30Oct/Nov 20259708/311 mark
As a member of the European Union, Greece must trade at the same exchange rate, tied to the euro, as stronger economies such as Germany. Greece has a persistent balance of payments deficit. How would changing to a floating exchange rate help Greece?
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Question 24Oct/Nov 20259708/331 mark
What is not a likely feature of a customs union?
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Question 25May/June 20259708/311 mark
A country’s government imposes a tariff on steel imports. What is the likely impact of this tariff on this country’s economy?
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Question 29May/June 20259708/311 mark
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Question 30May/June 20259708/321 mark
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Question 24May/June 20259708/341 mark
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Paper 4 · Data response and essays (4)
Case study: Working overseas
Many low-income countries have large proportions of the population below the World Bank’s absolute poverty level of $2.15 per day (United States dollars, 2022). One way in which these countries try to reduce their poverty is by the migration of workers to richer countries. The migrants send a portion of their incomes, known as remittances, back home to support their families.
These overseas workers are a link between migration and development. The flow of remittance money is greater than the foreign direct investment and official development aid received by middle-income and low-income countries. Total remittances received by those countries in 2022 was $650 billion, of which 45% ($293 billion) was received by only five countries.
About 50% of migrants from low-income countries went to high-income countries.
Migrants can find their incomes increase significantly. A nurse may make seven times more in Australia than in the Philippines, adjusted for purchasing power parity (PPP).
Unlike official aid, remittances flow directly to their receivers and are a stable source of income. They can buy extra food and they may provide savings for the receiver. They may reduce child labour in disadvantaged families and allow for higher spending on education through higher enrolments and more years of completed schooling.
Migration can reduce unemployment and raise wages in home countries. Migration may lead to larger benefits for the home country by increasing the rates of return on human capital caused by the creation of better, more productive, and higher paying jobs.
When the flow of migrants goes to a host country whose population is ageing, it may reduce the average age of the population. This can lead to an increase in the size of the labour force, reduce the age dependency ratio and make a positive tax contribution. The migrants increase the demand for host country output and may utilise housing in less popular areas. Those with a high level of education make an even more significant contribution to economic output.
Sources: The Guardian, 23 August 2023 asia.nikkei.com, 3 March 2023 imf.org, March 2020
Question 1(d)Oct/Nov 20259708/417 marks
(d) Consider if the article contains sufficient information to support the view that migrants have only a beneficial economic impact on the host country. [7]
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Considerif the article contains sufficient informationto support the view that migrants have only a beneficial economic impact on the host country. Beneficial to host country: Higher labour force(1), pay taxes (1) allows pay- as you-go pension system (1), increases demand (1), Increased productivity and economic growth (1)Entrepreneurship e.g.new business startups Max 3. Disadvantages: The effects of higher demand for housing (1),health services
(1), education services (1). cultural differences (1) are not mentioned, Other considerations-wage suppression in some sectors, short term unemployment effects, integration/training costs, regional disparities Max 3. Justified Conclusion (1)
Case study: Inequality and globalisation
A government commission published a report saying that global poverty and inequality were worsening and there was a risk that the gap between the rich and the poor would increase.
But, according to a newspaper, a lot of what is said about inequality is wrong. It overlooks the fact that the past 50 years saw a period of dramatic reduction in global inequality. The normal measurement of relative inequality is the Gini coefficient. The figure for global inequality in 1975 was 0.75, in 2020 it was 0.72 and in 2022 it was 0.67.
It is important to understand this trend rather than make the mistake of the commission.
The fall in global inequality should not come as a surprise. For about two hundred years the benefits of industrialisation went mainly to countries in Europe and North America. Income inequality between these countries and poorer countries worsened. The spread of globalisation in recent decades has meant this difference has lessened. Countries such as China and India have benefited from large increases in per capita (average) income, as shown in Table 1.1.
If the attention is on the relief of poverty rather than the wealth of the richest, improvements can be seen. Life expectancy has increased, most noticeably by ten years in the past two decades in the poorest region of sub-Saharan Africa. Literacy rates have also increased. Those in absolute poverty across the world have fallen from more than a third to under a tenth of the world’s population. And all this while the world’s population has increased.
Critics of globalisation and foreign direct investment (FDI) by multinational companies point to the possible negative environmental effects, the weakening of individual cultures and the reliance on international financial institutions that can fail. They also claim there can be exploitation of workers leading to greater wage inequality and possible increases in domestic unemployment as cheaper goods are imported.
Source: The Times, 23 August 2021
Question 1(c)Oct/Nov 20259708/438 marks
(c) With reference to the article, explain the idea of globalisation and assess whether there is enough evidence to conclude that globalisation has a net benefit for everyone. [8]
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With reference to the article, explainthe idea of globalisationand assess whetherthere is enoughevidence to conclude that globalisation has a net benefit for everyone. Globalisation means the growing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information. (2) Benefits mentioned include increases in incomes, life expectancy (10 years in sub-Saharan Africa) and literacy rates. A fall in absolute poverty. A fall in inequality (2) Drawbacks mentioned environmental issues, exploitation of workers, domestic unemployment, increasing dependence on other countries. (2) The benefits have occurred while the population has increased so are probably substantial. However, there is no statistical information to compare the benefits with the drawbacks. Also it depends on what ‘net benefit’ means– does it mean an increase in quantity of goods, higher profits, or does it mean wider choice, better quality. It is difficult to make an overall assessment. (2)
Question 5May/June 20259708/4120 marks
5 A free trade area gains all the benefits associated with being a member of a customs union while avoiding all the costs associated with being a member of a customs union.
Evaluate this statement. [20]
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A free trade area gains all the benefits associated with joining a customs union while avoiding all the costs associated with being a member of a customs union. Evaluate this statement.
Use Table A: AO1 Knowledge and understanding and AO2 Analysis and Table B: AO3 Evaluation to mark candidate responses to this question.
AO1 and AO2 out of 14 marks. AO3 out of 6 marks.
Indicative content Responses may include:
AO1 Knowledge and understanding and AO2 Analysis
- A free trade area should be defined and the emphasis be upon the removal of tariffs/quotas on products from one country entering another
- Key characteristics of a customs union should be identified which include recognizing abolishing tariffs between member nations while adopting a common external tariff on non-member countries.
- Analysis might recognize that a country in a free trade area can achieve faster economic growth through specialization and a global market
- The absence of import tariffs will reduce costs to firms operating in free trade areas, will increase incomes, economic competition and potentially an increase in labour productivity.
- Analysis of a customs union should identify a key difference in relation to the use of common external tariffs. Therefore, although members of a customs union might achieve similar benefits to members of a free trade area. Members of a custom union share protection from competitors outside the union while benefiting from access to a large single market.
- Analysis might also be used to show how members within the customs union might gain from the benefits of trade creation when internal tariffs are removed.
AO3 Evaluation
- One cost of associated with membership of a customs union might be the loss of economic and political sovereignty.
- Although there will be trade creation for a new member of a customs union it is likely that trade diversion will take place when a new member has to adopt a common external tariff. This would lead to a misallocation of the world’s resources.
- Higher economic growth can take place because of a closely integrated customs union -benefits from comparative advantage.
- It could however be argued that a closely integrated customs union will encourage greater political stability and integration.
- It has also been argued that due to the combined large market size of a customs union, there may be a further stimulus to inward foreign investment.
- Customs unions frequently use non-tariff barriers which can have a negative impact on both trade within a customs union and between a customs union and the rest of the world.
- A conclusion should attempt to form an overall judgement regarding the extent to which a free trade area can avoid the costs of membership of a customs union while achieving the same benefits.
Accept all valid responses.
AO1 Knowledge and understanding and AO2 Analysis
AO3 Evaluation
Question 5May/June 20259708/4220 marks
5 Globalisation will have an equally beneficial effect on the standard of living in both high-income and low-income countries.
Evaluate this statement. [20]
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Globalisation will have an equally beneficial effect on the standard of living in both high-income and low-income countries Evaluate this statement
Use Table A: AO1 Knowledge and understanding and AO2 Analysis and Table B: AO3 Evaluation to mark candidate responses to this question.
AO1 and AO2 out of 14marks. AO3 out of 6 marks.
Indicative content Responses may include:
AO1 Knowledge and understanding and AO2Analysis
- Definition: globalisation promotes free trade, free movement of capital and labour and technology transfer.
- Key characteristics of high-income/low-income countries.
- High living standards are generally associated with high GDP per capita; advanced infrastructure; good housing, education and health; and low infant mortality rates.
- An improvement in living standards is very closely linked with an improvement in economic performance. An improvement in economic performance is measured by increases in GDP per capita.
- Analysis of the globalisation process through trade, technology transfer, FDI, comparative advantage, remittances should provide opportunities to create more real income and investment for both high-income and low- income countries. If only one level of income considered L2 MAX 10
AO3 Evaluation
- The links between globalisation and changes in living standards are not clear.
- Difficult to measure the standard of living.
- Globalisation increases long distance transport which creates more negative externalities. But it is difficult to determine whether negative externalities have a disproportionate effect on the standard of living of low/high income countries.
- It is not clear how the benefits of globalisation would be used by each type of economy. Some low-income countries might not use any gains to stimulate long term growth. For example, a failure to invest in infrastructure. This would not improve living standards in the long run.
- Globalisation might lead to an increase in cheap imports from low-income economies which might lead to higher levels of unemployment in high- income economies and therefore reduce the standard of living.
- A conclusion might attempt to form an overall judgement on the distribution of benefits to low/high income countries. Also, a judgement on whether globalisation will improve living standards in either type of economy in both the short term and long-term.
Accept all valid responses.
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A Level Economics questions by topic
Each topic opens this practice tool with only that topic’s questions, plus how often it comes up and every question on it in one list.
- Unit 7The price system and the microeconomy
- Ch 30Utility
- Ch 31Indifference curves and budget lines
- Ch 32Efficiency and market failure
- Ch 33Private costs and benefits, externalities and social costs and benefits
- Ch 34Types of cost, revenue and profit, short-run and long-run production
- Ch 35Different market structures
- Ch 36Growth and survival of firms
- Ch 37Differing objectives and policies of firms
- Unit 8Government microeconomic intervention
- Ch 38Government policies to achieve efficient resource allocation and correct market failure
- Ch 39Equity and redistribution of income and wealth
- Ch 40Labour market forces and government intervention
- Unit 9The macroeconomy
- Ch 41The circular flow of income
- Ch 42Economic growth and sustainability
- Ch 43Employment and unemployment
- Ch 44Money and banking
- Unit 10Government macroeconomic intervention
- Ch 45Government macroeconomic policy objectives
- Ch 46Links between macroeconomic problems and their interrelatedness
- Ch 47Effectiveness of policy options to meet all macroeconomic objectives
- Unit 11International economic issues
- Ch 48Policies to correct disequilibrium in the balance of payments
- Ch 49Exchange rates
- Ch 50Economic development
- Ch 51Characteristics of countries at different levels of development
- Ch 52Relationship between countries at different levels of development
- Ch 53Globalisation