International Relations Chapters 8-10
What is the International Trade Commission (ITC) ?
A US Government agency that formulates trade rules and agreements for WTO consideration.
Which of the following arguments about free trade would a liberal economist be most likely to make?
A complete removal of trade barriers would improve the global economy.
World Health Organization (WHO)
A group within the United Nations responsible for human health, including combating the spread of infectious diseases and health issues related to natural disasters.
Gini Coefficient
A measure of income inequality within a population, ranging from zero for complete equality, to one if one person has all the income.
Neoliberalism
A return to policies intended to promote free markets and the free circulation of capital across national borders.
Dependency Theory
A socioeconomic theory based on the assumption that the process of the world economic system's development privileged a few countries while leaving the rest disadvantaged and vulnerable to exploitation.
What is a cartel?
An association of producers and/or consumers of a certain product, formed to manipulate its price on the world market.
Human Development Index (HDI)
An indicator of the level of development for each country, constructed by the United Nations, that is based on income, literacy, education, and life expectancy.
For which of the following industries would a state be most likely to engage in protectionism?
An industry that creates a product deemed vital for national security.
New International Economic Order
An outgrowth of developing states' frustration and an evolutionary step from the nonaligned movement, the Group of 77, and the United Nations Conference on Trade and Development (UNCTAD), there was, in 1974, a declaration of principles for a new international economic order. Nothing came of it because of the LDCs' lack of influence, combined with their disunity of purpose and priorities.
Why would an economic liberal argue against economic nationalism?
Because economic liberals are generally in favor of selling goods at whatever price the international economy can bear.
Why do some states have ownership in industries such as oil production or national airlines?
Because they are considered vital to the national economy.
In what way did those who established centrally planned economies believe that their economic system would be better than capitalism?
Centrally planned economies employed long -term planning, and proponents believed they could avoid the turmoil of the business cycle that is experienced in capitalist states.
What does the Organization of Petroleum Exporting Countries (OPEC) attempt to do?
Control the price of oil to benefit its member states
LDCs
Countries with low average incomes relative to industrialized states, a reliance on primary product exports, limited technology, and few social services.
Which of the following could be a negative result of protectionism?
Domestic industries may use protection to avoid needed improvements and may therefore remain inefficient and noncompetitive.
Neocolonialism
Economic dominance of a weaker country by a more powerful one, while maintaining the legal independence of the weaker state. In the late nineteenth century, this new form of economic imperialism characterized the relations between the Latin American republics.
Millennium Development Goals
Eight goals adopted by the U.N. in 2002 to reduce disparities between developed and developing countries by 2015.
What did the US Government do to help recover from the Great Depression?
Engaged in deficit spending.
Which argument do environmentalists sometimes make in opposition to free trade?
Environmental regulations vary from state to state. Free trade may result in an increase in products from states with lax environmental regulations.
humanitarian aid
Foreign aid extended in regions where there are emergencies caused by violent conflicts or natural disasters such as floods, earthquakes and tsunamis, intended to save lives, ensure access to basic necessities and provide assistance with reconstruction.
development aid
Foreign aid intended to help economically less developed countries; may involve project aid, program aid, technical assistance, or debt relief.
Which of the following is a potential negative consequence of free trade?
If labor costs are lower abroad, overseas companies may take businesses and jobs away from domestic companies.
Which of the following did proponents of a centrally planned economy believe to be one of its virtues?
In a centrally planned economy, government can guarantee the basic needs of its citizens.
Foreign Direct Investment
Investment made by a foreign company in the economy of another country.
In what way does dumping products in a foreign market hurt the hurt that market?
It crowds out the local competition. Without local competition, the foreign industry can then increase prices, hurting consumers.
Coup d'etat
Literally a "strike against the state"; Napoleon led one against the Directory in November 1799
In regard to the expansion of free trade policies, which of the following causes the most concern among workers in the Global North and their labor unions?
Low wages in the Global South
Why have environmental groups been so critical of the North American Free Trade Agreement (NAFTA)?
Mexico has lax environmental regulations.
Why is it often difficult for economic sanctions to be effective?
Sanctions tend to work best with multilateral support, but each trading partner has an economic incentive to continue trading.
NICs
Social and economic classification placing states between the most advanced industrialized states and LDCs.
Modernization Theories
Socioeconomic theories of development involving assumptions about progress occurring in stages from traditional societies to modern ones.
Why has agricultural policy been such a contentious issue in trade negotiations?
States in the Global North have been subsidizing agricultural industries, making it harder for the Global South to compete.
Which of the following best summarizes economic liberalism's core beliefs about international trade?
States mutually benefit from economic exchanges
Why have states in the Global South complained about industrialized states' agricultural subsidies?
Subsidies by states in the global North hinder the ability of states in the global South to export their agricultural products.
By the start of the twentieth century, the United States had become the world's largest and most advanced economy. Which of the following contributed significantly to its rise in power?
Territorial expansion that added vast amounts of natural resources.
Which of the following countries had a centrally planned economy for an extended period of time?
The Soviet Union
Which of the following illustrates the potential risk associated with economic globalization?
The US subprime mortgage collapse had a negative impact on world economies.
What is the Pareto-optimal frontier?
The area of the bargaining space where joint benefits are maximized and both actors are better off than they were before.
Resource Curse
The concept that revenue derived from abundant natural resources, such as oil, often bring unforeseen ailments to countries.
Why do competing companies sometimes form industry-wide organizations to lobby government about trade policy?
The entire industry often has a shared interest when it comes to trade policy.
Which of the following fosters international trade cooperation?
The existence of a hegemon that can provide a stable international framework.
In a Free Market, What is the equilibrium price?
The price at which the supply curve and the demand curve intersect.
Historical Determinism
The theory, often attributed to Marx, that the economic structure, rather than politics, drives human development toward a definitive end.
What is equalized among the most - favored nations of the World Trade Organization (WTO)?
Trade Restrictions
Who would be harmed if the United States added trade barriers to protect the American automobile industry?
US Automobile consumers.
When does a customs union become a common market?
When members of a customs union decide to coordinate other policies, such as monetary exchange.
Monterrey Consensus
a 2002 framework for global development in which the developed and developing countries agree to take joint actions for poverty reduction, with emphasis on free trade, sustainable growth and development, and increased financial aid
Import Substitution Industrialization (ISI)
a development policy that promotes cutting off international trade and substituting it with domestic production
Big Mac Index
a measure created by The Economist that compares the value of currencies by comparing the cost of a Big Mac hamburger in different countries. The United States is used as the baseline cost for the index.
purchasing power parity
a measure of how many units of currency are needed in one country to buy the amount of goods and services that one unit of currency will buy in another country
third-party sanction
a sanction levied against a third-party state to keep that state from doing business with the primary target of the sanctions
Tariff
a tax on imported goods usually reserved for regulating trade with foreign countries
developed country
a wealthy country with an economy that tends to produce manufactured goods and services for export
Military Aid
aid given to a country that directly enhances its military capability
democracy aid
aid given to a country to enhance and consolidate its transition to democracy
Orthodox Liberalism
an approach to economics that favors an extreme free-market approach where a government is very limited and most of a country is composed of private enterprise
Organization of American States (OAS)
an international organization, headquartered in Washington, D.C., United States.[1] Its members are the thirty-five independent states of the Americas. It is the world's oldest regional organization.
Washington Consensus
an orthodox liberal approach to development that took hold in the 1980s and was used to try to promote economic growth in poor countries. It had very limited success.
aid sanction
cutting off aid to a country in order to get it to change its behavior
pegged exchange rate
foreign currency exchange rates that are fixed or "pegged" by government officials against another currency or standard.
subsidies
funds given to companies by a government to help them grow
structural factors
historical and environmental factors that influence how a country can develop its economy
foreign aid
money, food, or other resources given or lent by one country to another.
arms embargo
not selling weapons to a country
fissile material
nuclear material used to make atomic weapons
African Union (AU)
organization in Africa devoted to representing the interests of African states
Organization for Economic Cooperation and Development (OECD)
organization of 34 member states that promotes liberal economic sustainability and equal manner
War Reparations
payments intended to cover damage or injury inflicted during a war
autonomy
self-government
International Atomic Energy Agency
the United Nations agency concerned with atomic energy
fungible
the ability to use one type of power for multiple purposes
economic sanctions
the cessation of some or all economic exchange between two countries
balance of payments
the difference between the amount of money that comes into a country and the amount that goes out of it
Metropole
the dominant part of an empire, distinguished from the subordinate colonies, which is normally the state that initiated colonization
financial sanction
the freezing of a country's financial assets held in another country
export-led growth
the idea that to develop a country's economy, the government should push for companies to focus on products that can be exported to other countries. The policy was most successful in the Asian countries such as South Korea and Singapore.
GDP per capita
the measure of a country's development. It is the total size of a country's ecomomy divided by its population.
Bretton Woods Organizations
the organizations created at the Bretton Woods conference. They include the World Bank, IMF, and later the GATT now WTO
Exporpriation
the seizure by a government of privately owned business of personal property for a proper public purpose and with or without just compensation
economic statecraft
the use of economic means to secure political ends
patronage politics
using state funds to pay off private or semi-private political supporters
Nationalization
when a government takes ownership of private property- land, a company, or an asset
import and export sanctions
when one country reduces or stops buying or selling products from/to another country
