PoliSci124 Final

Match the term to the definition

-A status quo in which at least one member of society can be made better off without making any other member of society worse off Pareto suboptimal -A status quo in which no member of society can be made better off without making some other member of society worse off Pareto optimal -An outcome in which none of the players has an incentive to change their strategy unilaterally Nash equilibrium -A strategy that enables a player to reward other players for cooperating and punish them for cheating. Reciprocity strategy -A situation in which parties to an agreement cannot be certain that the other parties will comply with the terms of the agreement. Enforcement problem -A strategy that is the best reply to all of the other player's strategies. Dominant strategy

If Argentina needs 4 workers to make a car and 8 workers to make a boat, and Brazil needs 10 workers to make a car and 10 workers to make a boat, and the countries do NOT trade, then the opportunity cost of a boat is

2 cars in Argentina and 1 car in Brazil ½ car in Argentina and 1 car in Brazil 9/7 of a car in both Argentina and Brazil 7/9 of a car in both Argentina and Brazil 1/2 car in both Argentina and Brazil A:2 cars in Argentina and 1 car in Brazil

Landowners dominated politics prior to World War II in Latin America, Asia, and Africa ... (Check all that apply)

Because the countries are land scarce, so landowners are able to demand high rents, which enriches the landowners Primarily through colonial structures in Asia Primarily through colonial structures in Africa Because the countries are land abundant (especially relative to capital), so they primarily export agricultural goods, which enriches the landowners Primarily through colonial structures in Latin America A:Primarily through colonial structures in Asia Primarily through colonial structures in Africa Because the countries are land abundant (especially relative to capital), so they primarily export agricultural goods, which enriches the landowners

According to the "chicken tax" in the podcast ...

China put a tariff on chickens, and the US responded with a tariff on imported trucks The US put a tariff on imported cars, and China responded with a tariff on imported chicken parts Germany put a tariffs on imported chickens, and the US responded with a tax on imported trucks Germany put a tariff on imported cars, and the US responded with a tariff on imported chickens A:Germany put a tariffs on imported chickens, and the US responded with a tax on imported trucks

Which of the following give countries more bargaining power in WTO trade talks? (CHECK ALL THAT APPLY)

Commitment to talks demonstrated by forgoing alternatives such as regional trade agreements Patience Impatience Determination not to walk away from talks An attractive alternative to a successful trade agreement A:An attractive alternative to a successful trade agreement, Patience

The logic of the collective action problem helps us understand why ...

Consumers rather than producers dominate trade politics Trade politics tend to favor liberalization Governments rarely liberalize trade unilaterally Governments tend to liberalize trade unilaterally Public radio is so successful in fundraising drives A:Governments rarely liberalize trade unilaterally

In the Game of Trust, which strategy tends to win if the game is played just once?

Cooperate Detective Cheat Copycat Grudger A:Cheat

In The Game of Trust, which strategy tends to win if the game is played repeatedly many times (e.g., 10 times)?

Copycat Grudger Always cheat Always cooperate Detective A:Copycat

Which of the following is an example of interests?

Democratic institutions promote mass participation in collective decisions American lumber producers want lower tariffs to buy cheaper Canadian lumber The theory of comparative advantage claims reducing tariffs raises aggregate social welfare American home builders want low lumber prices to make higher profits American home builders want higher lumber prices to make higher profits A:American home builders want low lumber prices to make higher profits

According to Rodrik, the average rich person (top 10% of income distribution) in a poor country (bottom 10% of countries) earns more money than the average poor person (bottom 10% of income distribution) in a rich country (top 10% of countries).

False

Deep trade relations between Germany and Russia are a recent example of how trade integration can successfully prevent war from occurring.

False

In the first century of US history, the North was pro-free trade and the South was protectionist.

False

The fact that Cuba's economy began to expand soon after the Soviet Union collapsed is mentioned in the TED talk as evidence that trade is good for economic growth.

False

India developed a manufacturing industry in the 1930s because

Markets for Indian exports constricted, forcing Indians to produce their own manufactures rather than import cheaper manufactures from abroad India had a comparative advantage in manufacturing because it was capital abundant relative to trade partners India had a comparative advantage in manufacturing because of its relative abundance in skilled labor relative to trade partners When India left the British Empire after World War 1, a nationalist government was committed to self-reliance Markets for Indian exports expanded, enabling export revenues to be invested in capital accumulation A:Markets for Indian exports constricted, forcing Indians to produce their own manufactures rather than import cheaper manufactures from abroad

Comparative advantage means

One country can produce a product with fewer worker-hours than another country One country can produce a product at a lower opportunity cost (in terms of other products foregone) than another country A:One country can produce a product at a lower opportunity cost (in terms of other products foregone) than another country

The research of David Cameron found that countries who trade more intensively tend to have

Smaller governments Larger governments A:Larger

Which of the following statements are true of the winners and losers from the US sugar policy?

Sugar beet farmers in Minnesota are protected from foreign competition Workers in sugar farms in Florida are protected from foreign competition American jobs in candy factories are protected from foreign competition Brazil sugar exporters are major winners from the US sugar policies American consumers benefit from cheaper candy prices A:Sugar beet farmers in Minnesota are protected from foreign competition Workers in sugar farms in Florida are protected from foreign competition

In the 1990s, Krugman estimated that trade had little effect on reducing workers wages - instead, his research indicated that almost all of the decline in unskilled labor wages was caused by technology. But by 2013, his research indicated that the sheer volume of trade with China had significantly increased the negative effect of trade on unskilled labor earnings.

True

In the new deal signed between the US and the EU, it was agreed that governments on each side would no longer be allowed to subsidize Boeing and Airbus.

True

The WTO appellate judges ruled that the US is violating WTO rules by banning clove-flavored cigarettes because US law still allows the sale of mint-flavored cigarettes.

True

Which of the following are "strong states", according to the definition used by Oatley? (check all that apply)

United States France Japan A:France Japan

The winners of ISI policies generally included (check all that apply - pay attention to the reasoning)

Urban workers, because they earned more from increased job opportunities in the manufacturing sector Urban workers, because they gained access to cheaper, locally made manufactured goods Farmers, because they earned more from agricultural exports Factory owners in comparative disadvantaged sectors Farmers, because they gained access to cheaper, locally made manufactured goods A:Urban workers, because they earned more from increased job opportunities in the manufacturing sector Factory owners in comparative disadvantaged sectors

A hegemon is a country that

are usually unwilling to contribute their fair share of the costs of the development of new technologies produces a disproportionately small share of the world's output because it trails in the development of new technologies produces a disproportionately large share of the world's output and leads in the development of new technologies produces a disproportionately small share of the world's output but leads in the development of new technologies produces a disproportionately large share of the world's output but trails in the development of new technologies A:produces a disproportionately large share of the world's output and leads in the development of new technologies

Economies of scale arise when the average cost of production falls ...

as profits increase. as specific experience skills increase. as specific experience skills decline. as the number of units rises. as the number of units falls A:as the number of units rises

The "modern" mercantilist school of international political economy

believes that governments should encourage imports whenever possible. emerged in Britain during the 18th century to challenge liberalism which was dominant. believes that governments should leave resource allocations decisions to the marketplace. believes that governments should encourage exports whenever possible. believes that economic strength is not a critical component of national power. A:believes that governments should encourage exports whenever possible.

Political institutions establish the rules governing the political process. For example,

in international economic organizations, decisions typically reflect the preferences of the less powerful nations democratic institutions restrict participation to a narrow set of individuals authoritarian systems promote mass participation in collective choices democratic institutions promote mass participation in collective choices A: democratic institutions promote mass participation in collective choices

As a hegemon declines in power, ...

it becomes less willing to bear the cost of maintaining trade rules and world trade becomes less open. it becomes more willing to bear the cost of maintaining trade rules and world trade becomes less open. it becomes less willing to bear the cost of maintaining trade rules and world trade becomes more open. it becomes less willing to bear the cost of maintaining trade rules so that more free riders will be able to profit. it becomes more willing to bear the cost of maintaining trade rules and world trade becomes more open. A:it becomes less willing to bear the cost of maintaining trade rules and world trade becomes less open.

The WTO reduces the impact of raw power on international trade relations because

it does not reflect the interests of the most powerful political systems. it promotes discriminatory international trade. it does not bring the rule of law to bear in international trade relations. it does not provide a dispute-settlement mechanism that allows governments to enforce common rules. it brings the rule of law to bear in international trade relations. A:it brings the rule of law to bear in international trade relations.

Oligopolistic global markets are characterized by ...

ower costs than those incurred in equally risky investments. a smaller number of competing firms. higher incomes for workers. a larger number of competing firms. profits greater than earned in equally risky investments. A: a smaller number of competing firms.

The WTO top trade court ...

plays no role in adjudicating trade disputes because nation-members are sovereign states. has successfully been adjudicating trade disputes between countries for the past ten years was no longer able to operate due to the Trump administration vetoing judges, but with new judges appointed by the Biden administration, has returned to adjudicating disputes remains unable to adjudicate trade disputes because the Biden administration has continued Trump's policy of vetoing judge appointments A:remains unable to adjudicate trade disputes because the Biden administration has continued Trump's policy of vetoing judge appointments

According to the Economist article, Biden's trade policy is to ...

settle trade disputes with allies and launch a general trade war with China promote free trade with all countries, including China protection American manufacturing from all competitors settle trade disputes with allies and place barriers on trade in some sectors with China A:settle trade disputes with allies and place barriers on trade in some sectors with China

Import substitution industrialization (ISI) was based on the strategy of

substituting previously imported simple consumer goods with newly domestically produced ones substituting previously exported simple consumer goods with newly domestically produced ones substituting previously imported advanced consumer goods with newly domestically produced simple ones substituting previously exported advanced consumer goods with newly domestically produced advanced agricultural ones substituting previously imported agricultural goods with newly domestically produced manufacturing ones A:substituting previously imported simple consumer goods with newly domestically produced ones

The international monetary system primarily facilitates ...

the international regulation of economic foreign aid. the interest rates of national currencies. the international exchange of national currencies. the international regulation of foreign direct investment. the national exchange of international currencies. A:the international exchange of national currencies.

In secondary ISI, emphasis shifts from

the manufacture of simple consumer goods to consumer durable goods and intermediate inputs the manufacture of simple consumer goods for domestic consumption to manufacture of simple consumer goods for export the manufacture of consumer durable goods to intermediate exports the manufacture of simple consumer goods for exports to the import of cheaper consumer durable goods A:the manufacture of simple consumer goods to consumer durable goods and intermediate inputs

The Bill That United the Senate is best described as an example of ...

the society-centered approach to trade policy infant industry protection strategic trade policy the factor model. A:strategic trade policy

The marginal rate of substitution is a consumption indifference curve that

typically slopes upwards tells us how much of one good the consumer is willing to give up to acquire an additional unit of the second good reflects the assumption of increasing marginal utility each additional good provides a greater increase of utility reflects the increasing aggregate utility of a country's consumption A:tells us how much of one good the consumer is willing to give up to acquire an additional unit of the second good

The claim that developing countries face a continuous decline in their terms of trade

was not really believed by governments in developing countries according to Oatley has been confirmed by most recent research according to Oatley. did not influence trade and development policies of developing countries according to Oatley cannot be tested because the hypothesis is too generalized according to Oatley has been disputed by most recent research according to Oatley. A: has been disputed by most recent research according to Oatley

If Argentina needs 4 workers to make a car and 8 workers to make a boat, and Brazil needs 10 workers to make a car and 10 workers to make a boat, and the countries DO trade, then ... (check all that apply)

Argentina will export cars to Brazil Argentina will export boats to Brazil Brazil will export cars to Argentina Brazil will export boats to Argentina The countries will not trade A:Argentina will export cars to Brazil Brazil will export boats to Argentina

Match the term to the definition

-Exports are almost fully accounted for by one product Monoexporter -Export-oriented agricultural sectors that have few linkages to other parts of the local economy Enclave agriculture -In an economy in which few people earn a money wage, no single manufacturing firm can sell its products unless other manufacturing activities start simultaneously Complementary demand coordination problem -Owners of manufacturing firms in one industry will not invest to increase production unless they are certain owners of manufacturing firms in interdependent industries will also increase production Pecuniary external economies coordination problem -Production of one good increases demand in industries that support components for that industry Backward linkages

Three reasons for the global shift from structuralism to neoliberalism as the guiding philosophy for economic development include:

A handful of East Asian countries outperformed other developing countries ISI policies were unsuccessful in promoting industrialization in countries who pursued those policies Many countries that pursued ISI policies experienced economic imbalances such as budget and trade deficits An economic crisis in the 1980s forced indebted countries to reform, and the IMF and World Bank pushed neoliberal policies A handful of Latin American countries outperformed other developing countries A:A handful of East Asian countries outperformed other developing countrie Many countries that pursued ISI policies experienced economic imbalances such as budget and trade deficits An economic crisis in the 1980s forced indebted countries to reform, and the IMF and World Bank pushed neoliberal policies

According to the prisoner's dilemma view of trade bargaining, the Group of 20's preference ordering is as follows:

Best option is Group 20 protects and EU liberalizes, then both sides liberalize, then both sides protect, then Group 20 liberalizes and EU protects Best option is Group 20 protects and EU liberalizes, then both sides liberalize, then Group 20 liberalizes and EU protects, then both sides protect Best option is both sides liberalize, then Group 20 protects and EU liberalizes, then Group 20 liberalizes and EU protects, then both sides protect Best option is both sides liberalize, then Group 20 liberalizes and EU protects, then both sides protect, then Group 20 protects and EU liberalizes None of the above A:Best option is Group 20 protects and EU liberalizes, then both sides liberalize, then both sides protect, then Group 20 liberalizes and EU protects

Which of the following are examples of Import Substitution Industrialization in Africa in the Economist article?

Blue Skies, a company near Accra, dices fruit sold in shops in Europe. tal Apparel employs workers in Hawassa in Ethiopia to make clothes, due to Ethiopia's supportive government, duty-free access to American markets Many Ethiopians now buy injera ready-made rather than baking it at home. Making or selling injera employs more than 100,000 people. Tian Tang, a Chinese business in Uganda, was founded by a trader importing suitcases; it now makes steel, plywood and mattresses.

According to the structuralist Singer-Prebisch theory,

Developing countries' terms of trade deteriorate over time, as periphery countries spend an increasingly smaller share of their income on manufactured goods, which reduces demand from local manufacturing firms Developing countries' terms of trade improve over time, as they become wealthier and therefore more capital abundant and therefore gain comparative advantage in manufacturing Developing countries' terms of trade deteriorate over time, as primary commodity prices fall relative to manufactured goods prices Developing countries' terms of trade improve over time, as periphery countries spend an increasingly larger share of their income on manufactured goods, which increases demand from local manufacturing firms Developing countries' terms of trade deteriorates over time, as core countries spend an increasingly larger share of their income on commodities from developing countries, which increases export income for developing countries but creates disincentives for developing

The following conditions must be met for cooperation to be achieved in a prisoner's dilemma scenario of trade negotiations (CHECK ALL THAT APPLY):

Each government must sufficiently value future benefits Governments must use reciprocity strategies to enforce the cooperation outcome An institution such as the WTO must act as a third party enforcer Each government must have an attractive outside option The game must be played repeatedly by the same governments A:Each government must sufficiently value future benefits Governments must use reciprocity strategies to enforce the cooperation outcome The game must be played repeatedly by the same governments

There are two reasons why firms might be efficient in the long run but not efficient in the short run:

Economies of scale Economies of experience Diminishing marginal returns of capital High labor productivity Relative capital abundance A:Economies of scale Economies of experience

According to strategic-trade theory, the location of high-technology industries is primarily determined by ... (choose the best two answers)

Economies of scale and experience High factor endowments in skilled labor Timing of market entry High factor endowments in land High factor endowments in capital A:Economies of scale and experience Timing of market entry

If England has a lot of capital relative to labor compared to the United States and the countries do trade, then (check all that apply)

England will export capital-intensive goods to the US England will export labor-intensive goods to the US England will import capital-intensive goods from the US England will import labor-intensive goods from the US A:England will export capital-intensive goods to the US England will import labor-intensive goods from the US

If England has a lot of capital relative to labor compared to the United States, and computers are capital-intensive and clothes are labor-intensive, then

England will have a comparative advantage in producing computers and the United States will have a comparative advantage in producing clothes The US will have a comparative advantage in producing computers and England will have a comparative advantage in producing clothes England will have a comparative advantage in producing both computers and clothes The US will have a comparative advantage in producing both computers and clothes A:England will have a comparative advantage in producing computers and the United States will have a comparative advantage in producing clothes

Which of the following are often included in Import Substitution Industrialization policies? (Check all that apply)

Government investment in manufacturing enterprises Government control of foreign exchange to facilitate import of capital goods Taxation on manufactured imports Government control of agricultural export boards Taxation of agricultural exports A:All

In The Game of Trust tournament, which strategy tends to win if the game is played repeatedly few times (e.g., 3 times)?

Grudger Always cheat Detective Always cooperate Copycat A:Always Cheat

In theory, countries with a majoritarian electoral system, compared to countries with PR electoral systems, are predicted to

Have higher tariffs, because political parties will appeal to large groups such as farmers Have higher tariffs, because interest groups such as sugar growers or textile workers will capture legislators and press for protection Have higher tariffs, because political parties will appeal to large groups such as labor Have lower tariffs, because interest groups such as automobile manufacturers or corn farmers will capture legislators and press for access to foreign markets Have lower tariffs, because political parties will appeal to large groups such as consumers A:Have higher tariffs, because interest groups such as sugar growers or textile workers will capture legislators and press for protection

The status quo tariff policies before the Doha Round of trade bargaining, according to Oatley, is:

High tariffs in developing countries on agricultural products and on manufactured goods. High tariffs in the advanced industrialized countries on manufactured products and high tariffs in developing countries on agricultural goods. High tariffs in the advanced industrialized countries on agricultural products and high tariffs in developing countries on manufactured goods. Low tariffs in developing countries on agricultural products and on manufactured goods. Low tariffs in the advanced industrialized countries on agricultural products and low tariffs in developing countries on manufactured goods. A:High tariffs in the advanced industrialized countries on agricultural products and high tariffs in developing countries on manufactured goods.

Match the outcomes of different levels of miscommunication in a repeated Game of Trust.

If the level of miscommunication is High ... It's best to always cheat If the level of miscommunication is Low ... it pays to be more forgiving If there is no chance of miscommunication ... Copycat is the best strategy

After the WTO appellate body made its decision between Indonesia and the US, ... (CHECK ALL THAT APPLY)

Indonesia raised tariffs on US imports of electronics and pharmaceuticals The US lifted its ban on flavored cigarettes Indonesia began exporting cigarette-looking clove cigars to the US The US and Indonesia reached a secret settlement. The WTO fined the US $42 million for every year it kept its ban on flavored cigarettes in place A:Indonesia began exporting cigarette-looking clove cigars to the US The US and Indonesia reached a secret settlement.

According to Rodrik, regulation by governments ...

Inhibits trade Can both facilitate and inhibit trade Facilitates trade Neither inhibits nor facilitates trade A:Can both facilitate and inhibit trade

Match the concept to the explanation

Interests: are the goals that actors want to achieve Ideas: are mental models about cause and effect, such as how government policies lead to economic outcomes Political institutions:establish the rules governing the political process

The Group of 77 developing countries used the UN Conference on Trade and Development (UNCTAD) talks and GATT talks to pursue ... (Check all that apply)

International commodity price stabilization by setting a floor for commodity prices to stop those prices from falling too low Financial transfers from advanced industrialized nations Liberalization of international commodity prices, to allow for the price of commodity imports to fall to more affordable levels Preferential access for export of manufactured goods from developing countries to industrialized nations Elimination of trade barriers on commodities in industrialized nations A:International commodity price stabilization by setting a floor for commodity prices to stop those prices from falling too low Financial transfers from advanced industrialized nations Preferential access for export of manufactured goods from developing countries to industrialized nations Elimination of trade barriers on commodities in industrialized nations

According to the factor model,

Land-owners are likely to benefit economically from and to support free trade in countries with low population density Workers are likely to benefit economically from and to support free trade in advanced economy countries Business owners are likely to benefit economically from and to support free trade in backward economy countries Workers are likely to benefit economically from and to support free trade in backward economy countries Business owners are likely to benefit economically from and to support free trade in advanced economy countries A:Land-owners are likely to benefit economically from and to support free trade in countries with low population density Workers are likely to benefit economically from and to support free trade in backward economy countries Business owners are likely to benefit economically from and to support free trade in advanced economy countries

Which of the following statements are true of the collective action problem?

Larger groups can more easily solve collective action problems because it is easier for large groups to monitor free-riders Larger groups can more easily solve collective action problems because the necessary contribution size is smaller per person Larger groups tend to be more successful in achieving their policy aims because they are larger collectively Smaller groups may be more successful in achieving their policy aims because of per-person transaction costs A:Smaller groups may be more successful in achieving their policy aims because of per-person transaction costs

A country's trade policy ideal point usually follow the rule of:

Liberalizing comparatively advantaged sectors and protecting comparatively disadvantaged sectors Liberalizing comparatively advantaged sectors and liberalizing comparatively disadvantaged sectors Protecting comparatively advantaged sectors and protecting comparatively disadvantaged sectors Protecting comparatively advantaged sectors and liberalizing comparatively disadvantaged sectors A:Liberalizing comparatively advantaged sectors and protecting comparatively disadvantaged sectors

Which two core principles stand at the base of the WTO?

Nondiscrimination Political liberalism Market conservatism Market liberalism Preferential discrimination A:Nondiscrimination, Market liberalism

What Nobel Prize winning economist was mentioned in the podcast episode?

Paul Krugman for his work on trade and geography Adam Smith for his work on the Invisible Hand Elinor Ostrom for her work on the tragedy of the commons John Nash for his work on game theory Mancur Olson for his work on collective action problems A:Elinor Ostrom for her work on the tragedy of the commons

A country with many veto players in the political system is likely to have more

Policy stability Policy volatility A:Policy stability

Which two core principles stand at the base of the WTO?

Preferential discrimination Market liberalism Political liberalism Market conservatism Nondiscrimination A:Market liberalism, Nondiscrimination

Tit-for-tat is an example of ... (Note: The Evolution of Trust game calls Tit-for-Tat "Copycat")

Prisoner's dilemma Enforcement problem Third party enforcement Reciprocity strategy Pareto improvement A:Reciprocity strategy

Policies to promote the development of infant industries are known as

Protectionist policy Development policy Trade policy Industrial policy Economic policy A:Industrial policy

The infant industry protection argument assumes that: (check all that apply)

Tariffs and other forms of protection can only make society worse off by preventing factors from moving out of low-return and into high-return industries There are cases in which newly-created firms will not be efficient initially but could be efficient when they become mature Tariffs can help firms in new industries by providing them with a guaranteed domestic market Mature firms are less efficient than young firms because mature firms use outdated technologies Diminishing marginal returns of capital means that large firms tend to be less efficient than small firms A:There are cases in which newly-created firms will not be efficient initially but could be efficient when they become mature Tariffs can help firms in new industries by providing them with a guaranteed domestic market

Private capital markets are unlikely to finance infant industries if ... (check all that apply)

The firm is expected to become efficient in the future primarily due to economies of scale The firm is expected to become efficient in the future due primarily to economies of experience The private capital market is efficient The private capital market is inefficient The firm is not expected to become efficient in the future A:The firm is expected to become efficient in the future due primarily to economies of experience The private capital market is inefficient The firm is not expected to become efficient in the future

Which two of the following statements are true?

The sector model predicts that political conflict will be between economic classes The factor model predicts that political conflict will be between economic classes Predictions from the factor model are more likely to be true than predictions from the sector model if factor mobility is low The factor model predicts that political conflict will be between export-oriented and import-substituting industries The sector model predicts that political conflict will be between export-oriented and import-substituting industries A:The sector model predicts that political conflict will be between export-oriented and import-substituting industries The factor model predicts that political conflict will be between economic classes

Does the coalition in support of tire tariffs comply with the factor model or the sector model?

The sector model, which argues that factors are mobile across sectors The sector model, which argues that factors are immobile across sectors The factor model, which argues that factors are immobile across sectors The factor model, which argues that factors are mobile across sectors A:The sector model, which argues that factors are immobile across sectors

Which of the following is true, according to Oatley?

The society-based approach assumes that under certain conditions trade protection can raise social welfare and that national policy reflects the balance of power between competing interest groups The state-based approach assumes that under certain conditions trade protection can raise social welfare and that national policy reflects the balance of power between competing interest groups The society-based approach assumes that protectionism reduces social welfare and that national policy reflects the balance of power between competing interest groups The state-based approach assumes that protectionism reduces social welfare and that national policy reflects the goals of national policy makers The society-based approach assumes that protectionism reduces social welfare and that national policy reflects the goals of national policy makers A:The society-based approach assumes that protectionism reduces social welfare and that national policy reflects the balance of power between competing interest groups

In the 17th century mercantilist system, (as described in Rodrik Chapter 1)

The state undertakes both commercial and public administration activities. The charter company undertakes both commercial and public administration activities. The charter company undertakes commercial activities (such as buying and selling) and the state undertakes public administration activities (such as public education, building roads, fighting wars, and dispensing justice). A:The charter company undertakes both commercial and public administration activities.

How did national economic policy in most countries change after World War I?

They no longer tightly controlled international financial flows They no longer tightly controlled international trade flows They continued to expand their colonial expansion They adopted the gold standard to finance the war They retreated into sheltered national economies A:They retreated into sheltered national economies

Brazil was able to get the United States to compensate them for unfair cotton subsidies by

Threatening to raise tariffs on US products such as cotton, software, and pharmaceuticals; appeals to the WTO were unhelpful because the US ignored WTO decisions Making political donations to US legislators Appealing to the WTO, and raising tariffs on US cotton Appealing to the WTO, and threatening to raise tariffs on US products such as software and pharmaceuticals Appealing to the WTO, and the WTO fined the United States A:Appealing to the WTO, and threatening to raise tariffs on US products such as software and pharmaceuticals

According to the basic Ricardian model, which of the following are true?

Trade leads to increased consumption opportunities in each country because specialization leads to increased productivity from learning by doing. Trade leads to increased consumption opportunities in each country because of comparative advantage Trade leads to increased consumption opportunities in the country with absolute advantage and reduced consumption opportunities in the country with absolute disadvantage Two countries with the same opportunity costs between products and a constant rate of product transformation can still benefit from trade A:

According to Rodrik, at the start of the Industrial Revolution, the income gap between the richest and poorest regions in the world was 2:1; today the difference is 20:1, and the gap between the richest and poorest country is 80:1.

True

As reported in The Economist, as of December 2019, the WTO's appellate body can no longer resolve disputes because the United States has been blocking the appointment of judges.

True

Cordell Hull argued that World War 2 was caused, in part, by the United States abandoning global economic leadership and free trade after World War 1.

True

Gains from trade are not dependent upon having an absolute cost advantage in a particular industry.

True

Governments, under WTO rules, cannot ban imports of a product on health or safety grounds unless a preponderance of scientific evidence indicates that the product is, in fact, harmful.

True

In 2020, most countries trade more with China than they do with the United States.

True

What was an example of an externality in Scarcity & Pistachios?

When a farmer chooses to use his land to grow pistachios, there is less land available to use for other purposes such as raising cows When a farmer sold more pistachios, it led to higher prices in pistachios for other farmers When a farmer expanded his pistachio farm, it led to more jobs for people in the neighborhood When a farmer drilled a well, it resulted in less water available for others in the area When one farmer drilled a well, it also provided a water source for others in the community A:When a farmer drilled a well, it resulted in less water available for others in the area

Transaction costs of trade are higher

Within countries Between countries A:Between countries

Oligopolistic global markets are characterized by ...

a smaller number of competing firms. lower costs than those incurred in equally risky investments. higher incomes for workers. a larger number of competing firms. profits greater than earned in equally risky investments. A:a smaller number of competing firms.

The Hecksher-Ohlin trade model argues that

developed countries have the same basic factor endowments developed countries have the same comparative advantages developed countries have a lot of capital but little labor comparative advantage arises from differences in factor endowments comparative advantage arises from similarities in factor endowments' A:comparative advantage arises from differences in factor endowments

"Non-discrimination" ensures that

each WTO member are required to lower tariffs with other WTO members each WTO member faces identical opportunities to trade with other WTO members each WTO member faces preferential opportunities to trade with other WTO members each WTO member faces identical opportunities to trade with other non-WTO members each WTO member are required to raise tariffs with other non-WTO members. A:each WTO member faces identical opportunities to trade with other WTO members

As a result of ISI policies, developing countries in the 1960s and 1970s ... (Check all that apply)

had stagnant or negative economic growth rates in the 1960s and 1970s became increasingly dependent on agriculture as their manufacturing industries failed due to inefficiency had rapid economic growth experienced high rates of indusrialization A:had rapid economic growth experienced high rates of indusrialization

If more trade is created than diverted, a RTA ...

has no net impact on trade. makes it easier for hegemons to stabilize trade. undermines the WTO's nondiscrimination principle. pushes the world toward protectionism. has liberalized trade. A:

Economic development strategies in the post WWII era in developing countries

have been largely unsuccessful in all developing countries. have been largely successful in the newly industrializing countries of East Asia. have been largely unsuccessful in the newly industrializing countries of East Asia. have been largely successful in the developing countries of East Africa. have been largely successful in all developing countries. A: have been largely successful in the newly industrializing countries of East Asia.

World trade has grown so rapidly over the last 60 years because

national economies becoming less connected as a consequence of greater wealth equality between rich and poor nations of the competition between the US and the USSR the WTO and GATT supported and encouraged such growth the world's economic output has grown more than trade A:the WTO and GATT supported and encouraged such growth

According to The Economist article,

nearly all American workers displaced by Chinese imports found another job. This supports the Factor Model. many American workers displaced by Chinese imports did not find another job. This supports the Factor Model. nearly all American workers displaced by Chinese imports found another job. This supports the Sector Model. many American workers displaced by Chinese imports did not find another job. This supports the Sector Model. A:many American workers displaced by Chinese imports did not find another job. This supports the Sector Model.