Intro to IR Exam 4

Tarrifs

A tax on imported goods

Global capital movements include: a. Direct foreign investment in buildings. b. Portfolio investments in other countries' stocks. c. Loans from international financial institutions like the World Bank d. Money from sovereign wealth funds e. All of the above

All of the above

Autarky

Avoid trading and produce your own goods domestically

Human Development Index

Combines indicators for live expectancy, educational attainments, and income into a composite value, ranging between 0 (low development) and 1 (high development) Caused by many factors; colonialism, earlier industrialization of Europe,geography, poor govt policies, unaccountable govts

Protectionism

Policy of restricting (not eliminating) imports in an effort to maintain or "protect" the economic viability of domestic industries

Which economic policy would a statist favor? a. Promoting exports over imports. b. Free trade c. Promoting equitable distribution of resources in the international system d. all of the above e. none of the above

Promoting exports over imports.

According to Adam Smith, market competition will ensure that prices are kept low. What is required for this to happen? -There are more sellers than buyers. -There are more buyers than sellers. -There are many competing buyers and sellers. -Buyers must purchase more goods. -Suppliers must sell more goods.

There are many competing buyers and sellers.

Discuss the various reasons states might enact trade barriers.

To protect new industries To generate revenue To prevent the spread of certain technologies To protect domestic industries facing stiff competition from abroad As retaliation (e.g. dumping) For health or safety reasons

Absolute Advantage

When a state can produce more of a given commodity more efficiently (or less costly) than another state can produce that same commodity

Thomas Friedman defines _____ as "the inexorable integration of markets, nation-states, and technologies to a gedgree never witnessed before." a. capitalism b. mercantilism c. globalization d. MNCs e. radicalism

globalization

Cyber Crime/Netcrime

includes cyber vandalism, theft, terrorism

Statists advocate taking measures to ensure that MNCs: a. are subject to the smallest amount of government regulation b. redistribute their resources to benefit both home and host country populations c. make economic decisions consistent with their home state's national interest d. recognize their role as exploiters of less developed countries e. ultimately replace states

make economic decisions consistent with their home state's national interest

The ____________ generation of human rights focuses on the state and its responsibility to provide for the social welfare of individuals, such as ____________. -second; voting rights -first; equal protection under the law -second; civil rights -third; life, civil liberty -second; education

second; education

The Organization of the Petroleum Exporting Countries (OPEC) produces about ____________ percent of the world's oil. -20 -30 -40 -50 -60

40

States that are not members of the Organization of the Petroleum Exporting Countries (OPEC) share ____________ percent of the world's oil. -40 -50 -55 -60 -70

60

Demographic Transition

A change in the rates of population growth. Before the transition, both birth and death rates are high, resulting in a slowly growing population; then the death rate drops but the birth rate remains high, causing a population explosion. Populations growth observations: -The population increase is not uniformly distributed. The developing world has much higher population growth rates than the developed world. -Both rapid rates of overall population growth and high levels of economic development mean increased demands for natural resources. For certain countries like China and India with large populations already, the problem is severe. -High population growth rates lead to numerous ethical dilemmas for policy makers: how can population growth rates be curbed without infringing on individual rights to procreate?

In 2000, why did the UN Security Council identify AIDS as a threat to global security? -Developed nations must do their best to help developing countries battle AIDS. -AIDS has serious economic, political and social consequences that stretch beyond the state. -The number of AIDS cases is on the rise. -The medicine used to treat AIDS is too expensive for poor nations to purchase. -Nongovernmental organizations (NGOs) can only do so much with their limited resources.

AIDS has serious economic, political and social consequences that stretch beyond the state.

Compare and contrast comparative advantage and absolute advantage. (possible question)

Absolute and comparative advantage are two important concepts in international trade that largely influence how and why nations devote limited resources to the production of particular goods. Absolute advantage compares the productivity of different economies while comparative advantage refers to the ability of a party to produce a particular good or service at a lower opportunity cost than the other, which leads to specialization and increased productivity. This means that a country with an absolute advantage over the other could still have different comparative advantages.

Sustainable Development

An approach to economic development that tries to reconcile current economic growth and environmental protection with the needs of future generations; it incorporates concern for renewable resources and the environment World Bank's rhetoric since the 1990s Countries could not get out of their debt and develop. The Heavily Indebted Poor Countries Initiative cancelled or substantially rescheduled countries' debts radicals thought debt doomed states to permanent underdevelopment There must be more emphasis on human development NGOs play critical role. Example: microfinance has been successful. Grameen Foundation empowers women who are ignored by multinational institutions and funds them

Which of the following core principles of realism are NOT challenged by the increasing importance of transnational issues? -the primacy of the state -the clear separation between domestic and -international politics -the primacy of state security -a and c -Answers a, b, and c are all challenged.

Answers a, b, and c are all challenged.

____________ developed a theory known as comparative advantage that argued states should produce and export those goods, which they can do efficiently. -Adam Smith -David Ricardo -Norman Angell -Mohammed Yunus -Thomas Friedman

David Ricardo

Discuss the various activies MNCs perform. (possible question)

Direct importing and exporting Making significant investments in a foreign country Buying and selling licenses in foreign markets Engaging in contract manufacturing Opening manufacturing facilities in foreign countries

Disparities in Economic Development

Disparities still persist: 1 Bill peple are surviving on less than $1 per day. 2.1 bill living on less than $2 per day Resources are distributes and consumed unequally What causes poverty and underdevelopment? Weak Exports Low Savings Low investment Low Industrial Production

The ____________ Round is the most recent round of GATT/WTO trade negotiations. -Tokyo -Doha -Kennedy -Uruguay -Torquay

Doha

Negative externalities

Economic development in agriculture and industry has costly unintended consequences for everyone, as well as positive effects: Environmental damage, Ozone depletion, Climate change -may be local, some have national and international implications ie. US + China demand for oil Oil Sands= extractive process

Globalization

Economic globalization: Goods and services are produced and traded globally. A global "virtual" world ties us together through new technology. Open trade, free flow of capital, and stable exchange rates were the foundations of globalization post-WWII Challenges: -Individuals who feel that economic decisions were beyond their control have resulted in antiglobalization movements and guerilla movements in Mexico opposed to NAFTA. -The Asian financial crisis in the late 1990s highlighted the problem of too much capital flowing out of the region. Many countries were unable to adjust to this rapid withdrawal, and thus exchange rates plummeted, individuals lost their jobs as companies went bankrupt, and stock markets fell. Antiglobalizers have also been stimulated by other repercussions resulting from the openness of economic markets. Two trends have become vexing: 1. The movement of labor: The EU adopted the goal, but it has not occurred. This has resulted in a flood of illegal aliens seeking better paying jobs in EU countries. This has led to a new market in illicit labor, trafficking in people, including women and children. 2. The rise of illicit markets: this can include the illegal movement of arms, money, drugs, human organs, endangered species, and protected intellectual property. PowerPoint: Increasing Integrated Global Markets -Interdependence Globalized companies emerging -100 larges economies in the world,52 are corporation Global problems are occurring -illicit markets, global warming Increase in problems of governance or regulation on the global level Innovation -IT, Transportation Facilities

Mercantilism/Statism

Economic theory that international commerce should increase a state's wealth, especially gold; state power is enhanced by a favorable balance of trade. International system is dominated by competitions among states for power and states will protect national interests -Strong government for efficient tax collecting -maximize exports -industrialization over agriculture -Statism: Modern version of mercantilism; use of state power to achieve economic and social goals -high tariffs, no foreign investments -concerned with relative gains Goal is to increase state power; state regulates economic life in pursuit of national interests Politics determines economics. Japan and other East Asian countries used their power to stimulate economic growth then harness power of MNCs in the state's interest Statist: set national economic and political objectives above international ones. MNCs are economic actors to be controlled. Suggest imposing national controls on MNCs, including denying market entry to some, using taxation to control repatriation of profits, and imposing currency controls

Compare and contrast realist, liberal, radical, and constructivist interpretations of the impact of transnational issues. (possible question)

For realists, the very core propositions are made problematic by globalizing issues. Realists have adopted a more nuanced argument—they contend that state primacy is not in jeopardy. For liberals, the globalizing issues can be more easily integrated into their theoretical picture. Radicals have never been comfortable with the primacy of the state and the international system that the dominant coalition of states created Constructivists have alerted others to the nuances of the changing discourse embedded in discussion of health, the environment, and human rights.

Nontarrif Barriers to Trade

Forms of restricting imports other than tariffs, such as quotas (ceilings on how many goods of a certain kind can be imported). Most fought are subsidies and regulations Non-tariff barriers to trade (NTBs) or sometimes called "Non-Tariff Measures (NTMs)" are trade barriers that restrict imports or exports of goods or services through mechanisms other than the simple imposition of tariffs. The SADC says, "a Non-Tariff Barrier is any obstacle to international trade that is not an import or export duty. They may take the form of import quotas, subsidies, customs delays, technical barriers, or other systems preventing or impeding trade." According to the World Trade Organization, non-tariff barriers to trade include import licensing, rules for valuation of goods at customs, pre-shipment inspections, rules of origin ('made in'), and trade prepared investment measures.

Compare and contrast GATT and the WTO.

GATT established a continual process of multilateral negotiations among countries who shared interest in the issues at hand. It was semi-formalized with no standing institutional bodies. Its post-WWII goals were to lower trade barriers and its jurisdiction applied to goods. Negotiations were carried out over 8 rounds of negotiations. The Uruguay Round dramatically lowered trade barriers and established the WTO, which was fully institutionalized with multiple standing bodies. States must implement a set of rules on a specific issue area instead of GATT line-by-line negotiation. Rules became enforced on member states and could even sue each other instead of voluntary compliance but there is now a lack of formal objections, no actual votes, and relies on consensus building and coalitions. Its rules and regulations were temporary in nature. The WTO was formed as a replacement for GATT with the purpose of supervising and liberalizing international trade. It is a more permanent structure and expanded GATT jurisdiction to include services and intellectual property. It holds regular ministerial meetings, giving it more political prominence than GATT. The WTO system for the settlement of disputes is faster and more automatic, and thus less susceptible to blockages than the former GATT system. The implementation of the decisions resulting from the WTO settlement of disputes will be better assured.

Multinational Corporations

Have major role in stimulating economic growth. Act as vanguards of liberal economic order. They have taken the integration of national economies beyond trade and money to include the internationalization of production move capital with foreign direct and portfolio investments; major role in success of emerging economies but private capital flow makes them unreliable for sustained development seek to avoid tariffs and import barriers Activities: -import/export goods/services -making significant investments in a foreign country -buy and selling licenses in foreign markets -engaging in contract manufacturing -opening market facilities or assembly operations in foreign countries Operate in international markets to: -Reduce transport costs by moving production closer to customers -Tax and license advantages from local governments -Find cheaper labor markets -Obtain the services of foreign technical personnel Liberals: believe that economic improvement is driven through efficiency and MNCs are the most efficient mechanism for economic improvement. They transmit capital, ideas, and economic growth. They should act independently from states. The market will regulate behavior and abuses can be corrected by other market actors or government regulation. Some see positive relationships between the international liberal economy and peace, that national differences should disappear with the formation of international market. Government role should be limited and only protect property rights and providing a functioning legal system. international competition is healthy and desirable with potential to lead to peaceful interactions; Washington Consensus: when areas of the economy are privatized, the government's fiscal burden is reduced

Compare and contrast realist, liberal and radical interpretations of dealing with with public health and disease problems. (possible question)

Health is an example of a quintessential functionalist issue, as health was one of the first areas of international cooperation. Everyone wants good health and to prevent the spread of disease but disagree on how to approach the issues. Realists are more apt to stress individual state responsibility and to acknowledge the importance of health when state security is threatened. Liberals are more apt to focus on international responsibility for dealing with health issues. Radicals see health as an issue that illustrates the economic differential between the wealthy developed world and the poor developing world.

How do economic liberals view human nature? a. Humans are aggressive. b. Humans always have conflictural tendencies. c. Humans have conflictual tendencies only when they are in groups d. Humans are rational and act to maximize self-interest e. Humans are naturally cooperative as individuals

Humans are rational and act to maximize self-interest

How do radicals view human nature? a. Humans are aggressive. b. Humans always have conflictual tendencies c. Humans only have conflictual tendencies when they are in groups d. Humans are rational e. Humans act to minimize self interst

Humans only have conflictual tendencies when they are in groups

World Health Organization (WHO)

IGO; took steps to help states create national AIDS programs beginning in 1986.

Structural Adjustment Programs

IMF policies and recommendations aimed to guide states out of balance-of-payment difficulties and economic crises policies include: economic reforms (limiting money and credit growth, forcing currency devaluation, reforming the financial sector, introducing user fees, eliminating subsidies), trade liberalization reforms (removing tariffs, rehabilitating export infrastructure), government reforms (privatizing public enterprises), and private sector policies (ending government monopolies)

WTO

Intergovernmental organization designed to support the principles of liberal free trade; includes enforcement measures and dispute settlement mechanisms; established in 1995 to replace the GATT 2 important procedures: -Trade Policy Review Mechanism (TPRM): conducts periodic surveillance of trade practices of member states -Dispute Settlement Body: designed as an authoritative panel to hear and settle trade disputes. The WTO can impose sanctions against violators and is more powerful than other economic dispute resolution arrangements. Global participation is painstaking. China's accession required that it make commitments to move toward a market economy. Vietnam, has made similar commitments Trade liberalization, the major goal of the WTO, remains controversial. Trade liberalization is based on comparative advantage and is a key engine of economic growth but it is unclear whether aggregate growth leads to the economic improvement of the lives of individuals. The Doha Round, launched in 2001, was announced as a development round to help developing countries correct the inequities of the previous trade agreements. It also brought out differences between North and South: North is relatively wealthy and parts of South are in poverty and struggle to meet basic needs. The North and the South remain deadlocked over the issue of agricultural export subsidies. Domestic groups and NGOs in many countries feel that the WTO is usurping the decisions and degrading the welfare of individuals and is undermining labor and environmental standards.

Foreign Direct Investment (FDI)

Investing in another state, usually by multinational corporations, by establishing a manufacturing facility or developing an extractive industry of natural resources

____________ in the 1960s and 1970s is frequently cited by statists as an example of successful mercantilist policies. -Germany -Kenya -Brazil -Japan -Canada

Japan

Which philosopher is associated with first generation human rights? -St. Thomas Aquinas -St. Augustine -John Henry -John Locke -Cicero

John Locke

Washington Consensus

Liberal belief that only through specific liberal economic policies, especially privatization, can development result; when areas of the economy are privatized, the government's fiscal burden is reduced Policies include: privitalization, liberalization of trade and foreign direct investment, government deregulation in favor of open competition, and broad tax reform World Bank and IMF promote these policies

Discuss how economic liberals and radicals differ in their interpretation of multinational corporations.

Liberals: MNCs are the most efficient mechanism for economic improvement that transmit capital, ideas, and economic growth. They should act independently from states. The market will regulate behavior and abuses can be corrected by other market actors or government regulation. Some see positive relationships between the international liberal economy and peace, that national differences should disappear with formation of international market. Government role should be limited and only protect property rights and providing a functioning legal system. international competition is healthy and desirable with potential to lead to peaceful interactions; Radicals: development has not occured and, to some, it is because of MNCs who exploit poor and perpetuate the dominance of the North and the dependency of the South. Interdependencies that MNCs create are instruments of dependency, exploitation, and even imperialism. Radicals argue that international regulation was necessary to limit the power of MNC's. The New International Economic Order (NIEO) and the Group of 77 represent examples of these ideas, attempts to make the international economy more favorable to least developed countries (LDCs). Statist: MNCs could be good or bad for state interests. They are economic actors to be controlled. Suggest imposing national controls on MNCs, including denying market entry to some, using taxation to control repatriation of profits, and imposing currency controls

____________ is an example of southern efforts to promote an international economic system more favorable to developing states. -NATO -NIEO -WTO -APEC -NAFTA

NIEO

Free Trade

No barriers to trade

North-South Divide and various issues

North: Avg. $40,046 gross national income (GNI) high consumption habits, high levels of education + health services, +social welfare safety nets Developed countries* South: -Avg. $2,904 gross national income (GNI) Struggle to meet caloric needs, poor educational + health services, + no welfare nets to meet the need of the poor Less developed countries*

Portfolio Investment

Private investment in another state by purchasing stocks on bonds, without taking direct control of the investments Investing in another country's stocks or bonds without taking direct control of those investments Investments -- made by MNCs

Compare and contrast realist, liberal and radical interpretations of dealing with global environmental problems.

Realists, liberals, and radicals do not have the same degree of concern for environmental issues. Realists' emphasis has been on state security Radicals are apt to see the costs borne disproportionately by those in the South and by the poorer groups in the developed North. Liberals see the environmental issue as appropriate to the international agenda. Constructivists are interested in how political and scientific elites define the problem and how that definition changes over time and new ideas become rooted in their belief sets.

Compare and contrast realist, liberal and Marxist interpretations of the study of international political economy.

Realists: Humans are aggressive. Humans and the international economy have conflictual tendencies. International commerce should increase a state's wealth, thus it's power. This is achieved by regulating economic life. Believe in strong government, maximizing exports, industrialization over agriculture, use of state power to achieve economic and social goals, and relative gains. Economics are subordinate to state interests. Insecurities create competitions and state must defend itself appropriately. concerned with relative gains Liberals: individuals act in rational ways to maximize their self-interest. Rational actions create markets that produce, distribute, and consume goods and work most efficiently without government interference. believe that economics should determine politics. promote market competition and a limited government. Interdependence leads to economic development. Focused on absolute gains. Want MNCs, open markets, free trade, free flow of goods and services, and low tariffs Marxist: individuals are naturally cooperative but not in groups due to capitalism. Economic relations are fundamentally unequal between the North and developing South. The international capital class benefits from these interactions and is supported by the government. They believe that internationalization is leading to domination by a few, hence, underdevelopment, exploitation, and dependency of the poorer states. MNCs exploit resources, perpetuate the dominance of the North and create state dependency. Example: NAFTA is another example of US expansionism and exploitation of the Mexican workforce

IMF

Stabilize economies (stabilize exchange rate) The Bretton Woods institution originally charged with helping states deal with temporary balance-of-payments problems but realized they were long-term structural problems that prevented countries from developing; now plays a broader role in assisting debtor developing states by offering loans to those who institute specific policies, or structural adjustment programs (policies and recommendations aimed to guide states out of balance-of-payment difficulties and economic crises) Acts as a lender of last resort to keep debtor states from collapsing Originally the fund established a system of fixed exchange rates. In 1972 this system collapsed when the United States announced that it would no longer guarantee the system. In 1976 the fund formalized the system of floating exchange rates currently in use. During the 1980s, long-term loans were given if states adopted structural adjustment programs. The Heavily Indebted Poor Countries (HIPC) Initiative was an effort to eliminate or reduce debt of poorest countries During Asian financial crisis of the 1990s, IMF responded with bailout packages to Thailand, Indonesia, and South Korea that included conditions that would transform their economies from semi-mercantilist to more open ones. Included lifting restrictions on the movement of capital and cutting the government budget, particularly in social programs. Led to moral hazard problem (states were rescued from the consequences of their reckless behavior, providing little incentive for them to change that behavior) The demise of the Soviet Union gave the IMF an active role in helping former Soviet and Soviet satellite countries make the transition to capitalist economies but these programs blurred the line between IMF and World Bank

Which of the following policies are not considered structural adjustment policies? a. Ending government monopolies b. Removing high tariffs c. Cutting bloated government spending d. Privatizing enterprises e. Subsidizing food

Subsidizing food

Discuss the various liberal principles that GATT enbodied. (possible question)

Support of trade liberalization Nondiscrimination in trade Exclusive use of tariffs for protecting home markets Preferential access in developed markets to products from the South Support concept of "nation al treatment" of foreign enterprises.

Protectionist Strategies

Tariffs Nontariff barriers to trade -quotas -Other Requirements: Labeling Health and Safety Standards -Subsidies and Loans to Domestic Groups Boycott Embargo

One hundred fifty-six states have ratified the Kyoto Protocol. Whch state hasn't? a. England b. France c. Germany d. Japan e. The United States

The United States

Comparative Advantage

The ability of a country to make and export a good relatively more efficiently than other countries; the basis for the liberal economic principle that countries benefit from free trade among nations liberal economics: comparative advantage makes production internationally market oriented economic gains cannot just be consider; must consider cost of achieving the other objectives because countries want to maintain domestic employment levels, environmental standards, subsidize emerging sectors to be competitive, etc

What is the development gap? a. The difference between the highly developed international oganizations in the North and the weakly developed international organizations in the South. b. The difference between the highly developed international oganizations in the South and the weakly developed international organizations in the North. c. The difference between the economically well off North and the poorer South d. The difference between the economically well off South and the poorer North e. The goal sought by the Group of 77 in the New International Economic Order

The difference between the economically well off North and the poorer South

Why are global issues such as environment, health, and human rights viewed as challenges to the state? -These issues will lead to a stronger state. -These issues require a federation of states. -Solutions require long-term planning for states. -These problems require cooperation at all levels of analysis. -These issues only threaten states in the developing regions of the world.

These problems require cooperation at all levels of analysis.

Compare and contrast relative gains and absolute gains.

These two concepts refer to how states will act in the international community. Absolute gains looks at the total effect of the decision while relative gains only looks at the individual gains in respect to others. Absolute gains will engage in comparative advantage and expand the overall economy while relative gains is a zero-sum game where one state can only get richer by gaining from others. Realists believe in the importance of relative gains because they believe that having power over other countries economically lends to more security. Liberals feel that absolute gains are important because they feel that it is important to make gains, not necessarily to make gains over other countries.

Millennium Development Goals

UN Sponsored Millennium Summet: 8 Goals Designed to reduce poverty by 2050 Promote sustainable human development in direct response to globalization Poverty reduction, better education, improved health, environmental sustainability, and global partnerships 1.Eradicate Extreme Poverty & Hunger 2.Achieve Universal Primary Education 3.Promote Gender Equality and Empower Women 4.Reduce child mortality 5.Improve maternal Health 6.Combat HIV/AIDS, Malaria, and other disease 7.Ensure environmental sustainability 8. Develop Global Partnership for Development Specific targets, time frames, and performance indicators,+ implementation plan. Goals have increased public awareness + help direct aid flows to poorer countries *Major gaps persist btw rural + urban areas, + btwn the poorest + richest household w/ countries *Climate change undermining process, + millions still live in poverty w/o access to basic services

The 2008-9 global economic crisis began because: a. China's economy went into recession b. US markets had excess credit and insufficient equity c. The price of oil increased sharply in 2008 d. The IMF refused respond to the crisis e. The developing world began a boycott against US products.

US markets had excess credit and insufficient equity

The General Agreement on Tariffs and Trade (GATT) became a formal institution known as the ____________ in 1995. -World Trade Organization -International Monetary Fund World Bank -North American Free Trade Agreement -World Tariff Organization

World Trade Organization

What is the Kyoto Protocol? a. a UN document geared toward reducing the emission of greenhouse gases b. a US proposal for slowing the trend toward global warming c. an EU agreement to create a common market for carbon sinks d. Japan's declaration that it does not view the emission of greenhouse gasses as a major international problem e. The US Congress's statement of opposition to the UNs plan for reducing greenhouse gas emissions

a UN document geared toward reducing the emission of greenhouse gases

Economic liberalism argues that ____________ will lead to greater economic development for all states. -economics and politics both -isolationism -economic protectionism -increasing economic interdependence -a clear separation of economics and politics

a clear separation of economics and politics

The increased importance of economics in international relations is the result of several trends, including: a. a decrease in national government responsibility for economic policies b. a growing confusions about the role of economics in people's lives c. a dramatic increase in transactions among national economies d. all of the above e. none of the above

a dramatic increase in transactions among national economies

Relative Gains

a zero-sum game where one state can only get richer by gaining from others. Looks at individual gains in respect to others. Associated with Mercantilism/Statism. Realists believe in the importance of relative gains because they believe that having power over other countries economically lends to more security.

Which of the following is NOT one of the Millennium Development Goals? -eradicate extreme hunger and poverty -combat HIV/AIDS, malaria, and other diseases -promote gender equality and empower women -achieve universal primary education promote entrepreneurship

achieve universal primary education promote entrepreneurship

What functions do NGOs serve in environmental affairs? serve as international critics monitor environmental regulations influence environmental policy coordinate with IGOs and state agencies all of the above

all of the above

Why do multinational corporations (MNCs) participate in international markets? -decrease transportation expenses -avoid trade barriers -get incentives from the host government -both a and b -all of the above

all of the above

New International Economic Order

an example of southern efforts to promote an international economic system more favorable to developing states. New International Economic Order (NIECO) 1970s Terms of international trade regulate MCNs Review Debt Burden of the South Increase Foreign Aid to South Change Structure of World Bank & IMF The New International Economic Order (NIEO) was a set of proposals put forward during the 1970s by some developing countries through the United Nations Conference on Trade and Development to promote their interests by: -improving their terms of trade, -increasing development assistance, - developed-country tariff reductions, -and other means. It was meant to be a revision of the international economic system in favour of Third World countries, replacing the Bretton Woods system, which had benefited the leading states that had created it - especially the United States. The main tenets of NIEO were: 1. Developing countries must be entitled to regulate and control the activities of multinational corporations operating within their territory. 2. They must be free to nationalize or expropriate foreign property on conditions favourable to them. 3.They must be free to set up associations of primary commodities producers similar to the OPEC; all other States must recognize this right and refrain from taking economic, military, or political measures calculated to restrict it. 4. International trade should be based on the need to ensure stable, equitable, and remunerative prices for raw materials, generalized non-reciprocal and non-discriminatory tariff preferences, as well as transfer of technology to developing countries; and should provide economic and technical assistance without any strings attached.

Embargo

an official ban on trade or other commercial activity with a particular country ie. cuba/us

Economic Liberalism

based on the recognition that states differ in their resource endowments. Worldwide wealth is maximized if states engage in international trade. David Ricardo developed a theory that states should engage in international trade according to their comparative advantage. That is, states should produce and export those products which they can produce most efficiently (specialize), relative to other states. Thus, gains from trade are maximized for all because each state minimizes its opportunity cost. National currencies should be bought and sold in a free market system. In such a system of floating exchange rates, the market determines the value of one currency as compared with other currencies. Floating exchange rates will lead to market equilibrium. Economic liberalization and new technologies stimulate not only the increasing flows of capital and trade but also the decreasing territorialization of economic life at global and regional levels Economic liberalization has led to the emergence of offshore financial centers with low taxation and little or no regulation believe that economics should determine politics. promote market competition and a limited government with open market, free trade, and free flow of goods and services policies. Interdependence leads to economic development.

Radical/Marxist Approach to IPE

believe that economics determine politics. Economic relations are fundamentally unequal between the North and developing South. The international capital class benefits from these interactions and is supported by the government. They believe that internationalization is leading to domination by a few, hence, underdevelopment, exploitation, and dependency of the poorer states. MNCs exploit resources and perpetuate the dominance of the North. radical reforms are needed for the redistribution of power. Example: NAFTA is another example of US expansionism and exploitation of the Mexican workforce Naturally Cooperative as indi

What historical trends can students of international relations observe about health and diseases? -Economic trade leads to the spread of disease. -Medical advances have made diseases more powerful. -Travel easier so diseases spread much faster than before. -a only -both a and c

both a and c

What role does the World Health Organization (WHO) play in international politics? -educational campaigns -sterilization -vaccinations -both b and c -both a and c

both a and c

Which of the following are known collectively as the International Bill of Rights? -International Covenant on Civil and Political Rights -Declaration of Human Rights -International Covenant on Economic, Social and -Cultural Rights -both a and c -all of the above

both a and c

Two gases, ____________ and ____________, are blamed for retaining heat in the atmosphere. -ethanol; carbon monoxide -carbon dioxide; methane -carbon monoxide; fluorocarbons -fluorocarbons; carbon dioxide -methane; ethanol

carbon dioxide; methane

States can earn credits from ____________ that offset emissions they produce by planting forests. -blue sky targets -carbon sinks -carbon emission offsetting -clear sky targets -adopting a tree

carbon sinks

Which conceptual perspective helps students of international relations understand why there are environmental problems? -collective security -collective goods -environmental security -natural resources security -Earth first

collective goods

Britsh economist David Ricardo argued that states should trade based on their _____ whereby each states produces and exports those products that it can produce most efficiently relative to other states. a. competitive trading bloc b. absolute advantage c. national interest d. floating exchange rates e. comparative advantage

comparative advantage

Radicals attribute the conflictual nature of the international system to: a. competition between both workers and developing countries and the owners of the wealth b. government intervention in the economy c. the failures of Bretton Woods institutions d. workers' power over state policies e. international anarchy

competition between both workers and developing countries and the owners of the wealth

Sustainable development, toward which the World Bank began orienting its activities in the 1990s, couples economic develpment with a. infrastructure projects such as dams b. concern for the environment c. restructuring states torn apart by ethnic conflict d. all of the above e. none of the above

concern for the environment

Liberals view the international economy as an arena of extensive cooperation. Statists: a. agree with liberals. b. disagree with the liberal view, seeing the international system as inherently conflictual. c. believe the liberals' view to be true for capitalists but not for workers. d. argue that as norms change, the international economy changes. e. none of the above

disagree with the liberal view, seeing the international system as inherently conflictual.

The 1933 Nobel Peace Prize recipient, Norman Angell, argued that war would eventually become an anachronism because of ____________. -democracy -peace treaties -disbanding of national armies -economic interdependence -political alliances

economic interdependence

With regard to the relationship between economics and politics, statists argue that: a. state politics should be subordinated to economic interests b. economics should serve the political interests of the state c. the state's national interest is determined by economic classes d. there should be no connections between the two e. none of the above

economics should serve the political interests of the state

The radical perspective on international political economy includes the view that MNCs are: a. exploiters of the poor b. losing political power over time c. benefactors of the poor d. essentially unimportant e. none of the above

exploiters of the poor

What is NOT one of the effects of global warming? -higher sea levels -more flooding -fewer glaciers -warmer oceans -fewer droughts

fewer droughts

The Magna Carta and the Bill of Rights are both examples of ____________ generation human rights. -first- -second- -third- -first- and second- -second- and third-

first-

The building of factories and investing in facilities for extraction of natural resources is called ____________ investment. -foreign direct -portfolio -derivative -sustainable -exploitative

foreign direct

International Bank of Reconstruction and Development

former name of the World Bank; Loans for reconstruction and industrial development, infrastructure, sustainable development, became the World Bank

What types of economic policies are NOT encouraged under the Washington Consensus? -government regulation -privatization -liberalization of trade -open competition -tax reform

government regulation

Economic liberals argue that free trade and open markets on an international scale will create: a. greater economic development for all states involved. b. stratification betwee rich and poor countries c. fewer benefits for rich states than poor states d. loss of power for somes states e. none of the above

greater economic development for all states involved

Collective Goods

help us conceptualize how to achieve shared benefits that depend on overcoming conflicting individual interest. -interest of preserving the commons for its collectivity -we must reassess the collective impact of our individual self interest Population becomes a collective good problem: what is economically rational for a family is not environmentally sustainable. Alleviate by: -Prohibiting procreation is politically untenable and pragmatically difficult. -Relying on group pressure to forces changes in behavior will not work in the populous states. -Some individuals desire smaller families but family planning methods may be unavailable to them.

Some liberal theorists go beyond simply extolling the economic benefits of liberalism and claim that an international liberal economy: a. will eventually make diplomatic relations irrelevant b. helps prevent war c. undoes the damage caused by realist theory d. will end poor states' dependence e. all of the above

helps prevent war

Political scientist Thomas Homer-Dixon finds a linkage between the environment and conflict. Which of the following is NOT a source of environmental scarcity? -population growth -unequal access to resources -heterogeneous society -decrease in quantity of renewable resources -decrease in quality of renewable resources

heterogeneous society

Global Governance

implies that through various structures and processes, actors can coordinate interests and needs although there is no unifying political authority. Skeptics of global governance do not believe that anything approaching it is possible or desirable.

In the 1950s, the World Bank changed its emphasis from reconstruction to development. What types of projects does the World Bank currently support? -environmental protection -infrastructure projects -help forge regional alliances -military development -promote democratic reform

infrastructure projects

Bretton Woods

institutions that expanded economic liberalism after WWII and led to postwar recovery and economic prosperity; US wanted stable exchange rates, rebuild war damaged economies, and low tariffs so created World Bank (stimulate economies), IMF (stabilize economies), and GATT and WTO (manage trade)

Boycott

is an act of voluntary and intentional abstention from using, buying, or dealing with a person, organization, or country as an expression of protest, usually for social, political, or environmental reasons.

Mecantilism, which developed between the fifteenth and eighteenth centuries in Europe: a. is the economic interpretation of liberalism b. is designed to increase states' economic power and wealth c. opposes state regulation of international economic transactions d. all of the above e. none of he above

is designed to increase states' economic power and wealth

One of the major weaknesses of the Kyoto Protocol is that developing countries were not included in the emission limitation requirement. Realists would argue that states like the United States are unwilling to sign this treaty because ____________. -it removes incentives for nations to strengthen their economy -it creates an unfair advantage for those nations that are not signatories to the Kyoto Protocol -there is no hard proof that global warming exists -there the United Nations lacks the ability to enforce state compliance -these limitation requirements will reduce quality of life for Americans

it creates an unfair advantage for those nations that are not signatories to the Kyoto Protocol

The Bretton Wods institutions are reflective of a _____ economic perspective a. radical b. constructivist c. liberal d. statist e. mercantilist

liberal

According to _____, the international political economy should be characterized by open markets, free trade, and minimal government intervention. a. statists b. mercanitlists c. liberals d. Marxists e. postmodernists

liberals

GATT

manage trade General Agreement on Tariffs and Trade; Founded by treaty in 1947 as the Bretton Woods institution responsible for negotiating a liberal international trade regime that included the principles of nondiscrimination in trade and most-favored-nation status; re-formed as the World Trade Organization in 1995 The GATT established a continual process of multilateral negotiations among those countries sharing major interests in the issue at hand; the agreements reached were then expanded to all GATT participants. Goal of post-WWII GATT was to lower trade barriers and most of the work was carried out over the course of eight negotiating rounds—each round progressively cutting tariffs and addressing new problems, such as intellectual property rights. Uruguay Round was the final round that dramatically lower trade barriers worldwide and created the World Trade Organization GATT enshrined important liberal principles: -Support of trade liberalization -Nondiscrimination in trade -Exclusive use of tariffs for protecting home markets -Preferential access in developed markets to products from the South -Support concept of "nation al treatment" of foreign enterprises.

The ____________ problem arises when states are rescued from the consequences of their reckless behavior, providing little incentive to change that behavior. -moral hazard -portfolio investment -sustainable development -feckless traveler -honest services

moral hazard

Economic liberalism argues that ____________ is (are) the engine of growth or vanguard of the liberal order. -intergovernmental organizations -multinational corporations -individual investors -direct foreign investment -nongovernmental organizations

multinational corporations

____________ is the trafficking in large amounts of illegal drugs such as heroin and cocaine. -narcotraficking -sex trafficking -human trafficking -externality -none of the above

narcotraficking

Which of the following is NOT typical of IMF structural adjustment programs? -economic reforms -trade liberalization -government reforms -nationalization of key industries -privatization

nationalization of key industries

What factors must a country take into consideration when thinking about its ability to produce specific products? -physical strength of labor -natural resource base -ratio of men to women -number of children -needs of society

natural resource base

What is NOT one of the principles associated with the General Agreement on Tariffs and Trade (GATT)? -preferential access in developed markets to products from the South -nondiscrimination in trade -no tariffs permitted -support of trade liberalization -both a and b

no tariffs permitted

What two principles, linked to sustainability, have evolved over time? -great-neighbor and no major harm principle -no-significant harm principle and good-neighbor principle -no-major harm principle and better-neighbor principle -preventive-action principle and good-neighbor principle -polluter-pays principle and no major harm principle

no-significant harm principle and good-neighbor principle

The Grameen Bank is an example of a(n) ____________. -intergovernmental organization -private individual -nongovernmental organization state -multinational corporation

nongovernmental organization state

Polluter Pays Principle

one of the "soft law" principles "You break it you buy it" example: if you're responsible for oil spill, you should clean it up

If each country engages in trade, using the comparative advantage model, each state gains by specialization and minimizes its ____________. -relative gain -resource depletion -opportunity costs -investment costs -political risk

opportunity costs

Malthusian Dilemma

population grows at higher level than natural resources and there will be a point where there will not be enough food to sustain the world; did not predict the demographic transition

The Malthusian dilemma was recognized in 1798 when Thomas Malthus postulated that ____________. -population will outpace natural resources -disease and war will decimate the population -population will outpace food production -famine will lead to population decrease -nuclear fallout would destroy food production potential

population will outpace food production

Second generation human rights are also known as ____________ rights. -dynamic -neutral -positive -essential human -social

positive

Although originally designed to facilitate reconstruction in post-World War II Europe, much of the World Bank's funding actually has been used to: a. promote economic development b. increase government bureaucracy c. lower trade barriers d. implement structural adjustment programs e. none of the above

promote economic development

Alexander Hamilton, the United States' first secretary of treasury, advocated protectionist policies to achieve what objective? -protect American farmers -protect American jobs -prevent unfair competition with China -protect the new nation's manufacturers -prevent offshoring to Mexico

protect the new nation's manufacturers

The radcal view of the international political economy is more normative than that of statists or liberals because: a. radicals praise the work of multinational corporations (MNCs) in the developing world to date b. radicals argue for minimal government intervention in the economy c. radicals criticize capitalism for worsening economic problems in the developing world d. all of the above e. none of the above

radicals criticize capitalism for worsening economic problems in the developing world

Because of the ad hoc tribunal for Rwanda, judges argued that ____________ constitutes not only a crime against humanity, but also genocide. -murder -trafficking -rape -violence against ethnic minorities -slavery

rape

Statists are best aligned with which political counterpart? -radicalism -realism -neo-realism -constructivism -liberalism

realism

The 1997 Kyoto Protocol provides for two objectives: stabilizing the concentration of greenhouse gases and ____________. -reduce oil consumption by 2010 -reduce production of sports-utility vehicles (SUVs) -increase alternative sources of energy -reduce emissions by 2010 -increase production of hybrid vehicles

reduce emissions by 2010

Which of the following dimensions of the EU are found in NAFTA? -social -political -reduction in tariff barriers -security -none of these are part of NAFTA

reduction in tariff barriers

When exchange rates float, currencies: a. sell at value determined by the market b. sell for less than their market value c. sell for more than their market value d. sell at a predetermined rate e. are not bought and sold at all

sell at value determined by the market

The World Trade Organization (WTO): a. invests in developing countires b. sets tariff rates that all countries must follow c. serves as a venue for settling trade disputes d. includes only the richest 20 countries in the world e. has refused to accept China as a member because of trade violations

serves as a venue for settling trade disputes

Sustainable Development Goals

set by UN General Assembly, include 17 goals including poverty and hunger, ensuring healthy lives in safe and inclusive cities, and developing reliable and sustainable modern energy supplies. Funding through partnerships among governments, the private sector, and NGOs, not traditional foreign aid

Transnational issues are a threat to the ____________ of states. legitimacy sovereignty popularity insularity externality

sovereignty

Realists agree that health is a development issue but disagree on where the responsibility for addressing this issue rests. Realists argue that that the onus falls on the ____________, while liberals place responsibility on the ____________. -international system; state -state; individual -individual; state -state; international system -international system; individual

state; international system

Good-Neighbor Principle

states should cooperate in international system that will benefit everyone because they are issues that are pressing to everyone

No-Significant-Harm Principle

states will do nothing to cause significant damage to other states A state cannot initiate policies that cause significant environmental damage to another state

Which economic theory or theories view MNCs as both potentially good and bad for state interests? -economic liberalists -radicals -statists and Marxists -statists -economic liberalists and radicals

statists

World Bank

stimulate economies formally known as the International Bank for Reconstruction and Development; A global lending agency focused on financing projects in developing countries; established as one of the key Bretton Woods institutions to deal with reconstruction then shifted to development in the 1950s after it became evident that some states have more difficulty attracting private investment than others and temporary balance of pay options were actually long-term structural problems. Sustainable development became important in the 1990s. It generates capital funds from member-states contributions and from borrowing in financial markets. Most funding has been used for infrastructure development. Its support for private-sector participation has become known as the Washington Consensus International Finance Corporation (IFC), International Developement Association (IDA), and Multilateral Investment Guarantee Agency (MIGA) were established to provide capital to states unable to attract private investment alone but these efforts continue to decline as a proportion of total capital flows

Narcotrafficking

the transportation of large quantities of narcotics—has always been a problem, but has become a focus since the end of the Cold War. Narcotrafficking has survived as demand for drugs has been relatively stable over time while transport costs have fallen.

By 2025, how many of the world's people will live in countries facing either moderate or severe water shortage problems? -two-thirds of the population -one-fourth of the population -one-half of the population -three-fourths of the population -two-fifths of the population

two-thirds of the population

The initial responses to the Global Economic Crisis of 2007-2010 were -undertaken by NGOs -multilateral -unilateral -radical -both c and d

unilateral

Absolute Gains

will engage in comparative advantage and expand the overall economy. It looks at the total effect of the decision; Liberals feel that absolute gains are important because they feel that it is important to make gains, not necessarily to make gains over other countries.