Globalization and Financialization

Which of the following statements directly refers to true transnational collective bargaining?

Unions in more than one country negotiate jointly with the same firm over wages and other economic factors.

What are the minimum standards for companies as specified by the European Works Council directive? (Check all that apply.)

Councils must be informed and consulted about the business' progress. Councils must meet with management at least once a year.

True or false: International investment portfolios are a form of foreign direct investment (FDI).

False

Identify the effects of globalization and financialization. (Check all that apply.)

Financialization has broadened inequality and diverted investment away from the shop floor. Traditional industrial unions such as the United Steelworkers and United Auto Workers are now general unions with very diverse memberships.

What are the provisions of the North American Free Trade Agreement (NAFTA) that pertain to the countries involved in it? (Check all that apply.)

Intellectual property rights are protected. Firms based in any of the countries are allowed to invest, sell services, and bid on government contracts in all the countries involved in the agreement.

Which of the following is true about the corporate code of conduct that is monitored by the Fair Labor Association?

It requires that employees be informed of the standards and provided with opportunities to report noncompliance.

Identify the true statements about the International Labor Organization (ILO). (Check all that apply.)

Its primary activity is to adopt and promote practices that specify minimum labor standards on specific issues. It has a peculiar tripartite structure.

Match the dimensions of financialization (in the left column) with their descriptions (in the right column).

Share price maximization: Cost-cutting to enhance financial returns rather than productive competitiveness Profits through financial transitions: Pursuing profits via financial transactions rather than the production and delivery of goods and services Private equity: Leveraged buyouts to buy and then sell firms after cost-cutting and asset-stripping Public Sector budget: National economies subjected to international financial needs

Match the dimensions of financialization (in the left column) with their components (in the right column).

Share price maximization: Involves stock repurchases rather than reinvestment Profits through financial transactions: Increasing significance of the financial sector and the financial activities of nonfinancial firms public sector budget: Involves state and local governments focusing on budget reduction

Which of the following is a result of private equity funds using leveraged buyouts to take over firms that are seen as underperforming, installing their own cost-cutting leadership teams, stripping off assets, and then selling the pieces at a remarkable profit?

Shareholder value ethos is pushed to the extreme.

True or false: Immigration allows capital to seek its highest rate of return.

TRUE

Which of the following signify that financialization is like globalization? (Check all that apply.)

They both include a group of interrelated structural changes in the economy. They both have an impact on economic and political power.

What are the disadvantages of globalization? (Check all that apply.)

Volatile flows of foreign portfolio investment impair fragile developing country banking systems and economies. Low-cost competition from countries that breach labor rights causes domestic job losses and erosion of income and working conditions.

Match the central dimensions of a multinational corporation's global strategy (in the left column) with their elements (in the right column).

configuration: The location of several activities of the corporation coordination: The degree to which activities of the corporation in various countries are harmonized or autonomous

Unlike the North American Agreement on Labor Cooperation (NAALC), the labor provisions of trade agreements that followed the North American Free Trade Agreement have _

their own labor chapter within the free trade agreement

True or false: The nature of global supply chains is significant when thinking about why or why not corporate codes of conduct are important in various segments of the global economy.

true

True or false: True transnational collective bargaining is rare.

true

The _____ is a worldwide federation of national union federations such as the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO, United States), Trades Union Congress (Great Britain), Deutscher Gewerkschaftsbund (DGB, German Trade Union Confederation), and over 300 others from more than 160 countries representing 180 million union members around the world.

International Trade Union Confederation (ITUC)

Which of the following have the potential to support domestic-level collective bargaining? (Check all that apply.)

Enforceable international labor standards Transnational collective bargaining

For firms with significant operations in at least two European Union (EU) countries, a(n) _ _ _ is a transnational, company-level committee of employees from these different operations that has consultation and information rights on issues that affect workers in more than one country.

European Work Council

Which of the following are part of the shareholder value model of financialization? (Check all that apply.)

Executives are largely rewarded via stock options. The corporate and investment mantra is to maximize shareholder value. The focal activity of executives and investors is to monitor stock prices.

Which of the following lead to benefits from free international trade? (Check all that apply.)

Expanding the size of markets Reducing the monopoly power of domestic firms

Which of the following are the advantages of globalization? (Check all that apply.)

Foreign direct investment enhances technology, infrastructure, and productivity. Improving property rights, decreasing subsidies, and increasing wealth can result in practices that preserve the environment

In the context of international management, match the situations in a firm (in the left column) with the associated steps local managers of the firm should follow (in the right column).

Formal labor relations processes and structures are centralized: Local managers are required to strive for ways to integrate the aspects of local responsiveness and problem solving. Labor relations processes are decentralized.: Local managers are required to create networks across their firm to facilitate coordination and learning

Match the factors that create pressures that are putting great strain on the New Deal industrial relations system and its participants (in the left column) with their features (in the right column).

Globalization: Opens up greater financial opportunities while adding competition that can reduce financial returns Financialization: Deepens global integration while increasing the pressure on organizations to search globally for ways to generate the highest financial returns

What are the examples of foreign direct investment (FDI)? (Check all that apply.)

A domestic firm buying a foreign-owned company A domestic firm establishing a new factory, call center, or other operation in another country A domestic firm entering into a joint venture with an overseas enterprise

Identify a feature of a corporate code of conduct.

A firm establishes its corporate code of conduct almost always voluntarily.

In the context of international management, match the types of companies (in the left column) with their descriptions (in the right column).

A firm in which all units are fully autonomous, or decentralized: It does not have a source of global competitive advantage such as standardized products, economies of scale, or organizational learning. A multinational corporation in which all decisions are centralized and all practices comply with global uniform policies: It does not have the ability to capitalize on local differences and opportunities.

Identify a situation that leads to social dumping.

A foreign competitor sells a product unfairly at a lower price than domestic producers because of lower labor or environmental standards.

Match the parties involved in foreign direct investment (FDI) (in the left column) with their benefits (in the right column).

A foreign country: Able to reduce labor costs, diversify a firm's labor pool and talent base, avoid independent unions, have an authoritarian state limit worker protest, take advantage of tax breaks, and provide access to raw A host country: Able to have new capital for investment, high-paying jobs, new technology, more products and competition, and opportunities to understand

Which of the following refers to a global union federation?

An international association of national trade unions representing workers in certain industries, industry groups, or other sectors of employment

In the United States, efforts to control or abolish bargaining rights for public sector workers in Wisconsin, Ohio, and elsewhere starting in 2010 have consistently been justified by stating the need for budget austerity. Why can this be considered an extension of financialization? (Check all that apply.)

Because public sector pension shortfalls and budget deficits were at least partly an outcome of the financial crisis Because more importance is given to fiscal concerns than to service delivery

The nature of global supply chains is significant when thinking about why or why not corporate codes of conduct are important in various segments of the global economy. Match the types of global supply chains (in the left column) with their descriptions (in the right column).

Buyer-driven global supply chains, as in apparel and retailing: Conditions are not conducive to traditional union campaigns concentrated on mobilizing worker power directed at a firm. Alliances of diverse groups, such as worker activists, human rights groups, and college students, are required to create publicity. Producer-driven global supply chains, as in automobiles: Unions are better able to develop stable membership bases and alliances across multiple locations. Pressure is directed at a firm in traditional ways, such as job actions.

Which of the following countries are parties to the North American Free Trade Agreement (NAFTA)? (Check all that apply.)

Canada USA Mexico

Match the central dimensions of a multinational corporation's global strategy (in the left column) with the descriptions based on their components (in the right column).

Configuration: Refers to the location of suppliers and subcontractors and concerns whether production is concentrated in one country and exported to other markets or production is globalized into various countries through foreign direct investment (FDI Coordination: The extent to which human resource management policies and production methods are needed to follow one consistent model throughout the local operations of the corporation

Why are the incorporation of labor, environmental, public health, and other standards into trade agreements and the ability to impose trade sanctions on countries that violate these standards labeled fair trade? (Check all that apply.)

Including these social clauses in trade agreements can prevent social dumping. Including these social clauses in trade agreements can avoid a "race to the bottom" in aspects such as salaries and working situations.

Match the different dimensions of globalization (in the left column) with their descriptions (in the right column).

International trade: Cross-border flow of goods and services Foreign direct investment: Cross-border flow of multinational corporation investment International investment portfolios: Cross-border flow of investment securities Immigration: Cross-border flow of people

Match the different dimensions of globalization (in the left column) with the methods involved in them (in the right column).

International trade: Exports and imports Foreign Direct investment: Purchasing or establishing foreign subsidiaries and joint ventures International investment portfolios: investing in foreign stocks and bonds Immigration: Migrating from one country to another

Which of the following were the outcomes of deregulating the financial sector? (Check all that apply.)

It allowed commercial banks to become more like investment banks. It resulted in industry consolidation.

Identify a benefit of international investment.

It boosts risk sharing across border and lets investments find their most productive uses.

Identify the true statements about the International Trade Union Confederation (ITUC). (Check all that apply.)

It gives education and training to union leaders and financial assistance to developing labor movements. It gathers and publishes data and research to keep unions abreast of developments in other countries.

Identify a true statement about an international investment portfolio in contrast with foreign direct investment (FDI).

It is carried out by institutional and individual investors who own foreign stocks and bonds or invest in international mutual funds.

Which of the following are true about the effects of the North American Free Trade Agreement (NAFTA) and the North American Agreement on Labor Cooperation (NAALC), its labor side agreement? (Check all that apply.)

NAFTA provides the basis for unions in the United States, Canada, and Mexico to cooperate in repeated, concrete ways. NAFTA led to a shift in the attitudes of the Canadian and U.S. labor movements.

Identify a true statement about immigration in the United States.

Since most immigrants to the United States are low-skilled, U.S. workers who are low-skilled face additional competition.

Match the kinds of European Works Councils (in the left column) with their features (in the right column).

Symbolic European Works Councils: The council representatives refrain from trying to engage in a dialogue with management Participative European Works Councils: They are the most advanced form of European Works Councils.

Match the types of European Works Councils (in the left column) with their descriptions (in the right column

Symbolic European Works Councils: They are passive and satisfy the minimum requirements of the European Works Council Service European Works Councils: They primarily aid national unions bypassing Project-oriented European Works Councils: THey develop their own internal capabilities and pursue projects beyond Participative European Works Councils: THey have active consultation and perhaps joint projects

True or false: Globalization and financialization are each a group of interrelated structural changes that have similar effects in the distribution of power, income, and wealth, and in the pattern of economic growth.

T

True or false: International trade lets consumers and producers benefit from specialization.

T

Which of the following is a specialized agency of the United Nations focused on promoting social justice and internationally recognized human and labor right

The International Labor Organization

Identify the true statements about the North American Agreement on Labor Cooperation (NAALC), a side agreement of the North American Free Trade Agreement (NAFTA). (Check all that apply.)

The NAALC specifies procedural rules that necessitate cross-border contact. The NAALC machinery gives a legitimate mechanism to labor to express and request resolution of grievances.

Which of the following merged to form the International Trade Union Confederation (ITUC)? (Check all that apply.)

The World Federation of Trade Unions The International Confederation of Free Trade Unions

Which of the following is the dominant institution for reducing trade barriers and pursuing free trade on a global scale?

The World Trade Organizations

Match the various aspects of European Works Councils (in the left column) with the factors that determine them (in the right column).

The council's size, allocation of members, location and duration of meetings, and method for consultation: Individual firms and their employees The requirements for what data must be given to the council and whether employee representatives are elected by the employees or appointed by elected union officials: The national law of the country in which a firm is headquartered

Which of the following are part of the Charter of Fundamental Rights of the European Union? (Check all that apply.)

The freedom of association to join labor unions Guarantees of information and consultation

Identify an element of the dimension of financialization called profits via financial transactions.

The increased significance of the financial activities of nonfinancial firms

Which of the following are rejected by the use of corporate codes of conduct? (Check all that apply.)

The market-oriented idea of labor as a commodity The assumption of perfect competition that safeguards employees from abuse

In the context of global systems, match the intellectual schools of thought (in the left column) with the alternative methods that are viewed as best for setting employment terms and conditions (in the right column).

The neoliberal school: Free Markets Pluralist industrial relations school: Labor unions and government regulations Critical industrial relations school: A system that significantly alters capitalist power relations

What are the core labor standards established by the Declaration on Fundamental Principles and Rights at Work in 1998? (Check all that apply.)

The prohibition of discrimination in employment and pay The abolition of child labor Freedom of association and collective bargaining The eradication of forced labor

Which of the following are specified by the Charter of Fundamental Rights of the European Union? (Check all that apply.)

The right to engage in collective bargaining and to strike Health and safety protections, annual leave, and access to training Freedom of movement and equal treatment and compensation for men and women

Identify a disadvantage of globalization.

The world's largest companies are bigger than the economies of many countries.

In contrast to free trade arrangements under the World Trade Organization (WTO) and the North American Free Trade Agreement (NAFTA), residents of the European Union (EU) _

are allowed to freely work in any EU country

A feature of the core labor standards established by the Declaration on Fundamental Principles and Rights at Work in 1998 is that they __

are not legally enforceable

Identify a true statement about the World Trade Organization (WTO) rulings in trade disputes.

They generally support the removal of national trade standards.

What is the primary intention of the European Works Council directive?

To build a cooperative dialogue between labor and management

What is the primary objective of the International Trade Union Confederation (ITUC)?

To promote consultation, communication, and cooperation among unions

What are the intentions of the North American Agreement on Labor Cooperation (NAALC) that is included in the North American Free Trade Agreement (NAFTA)? (Check all that apply.)

To result in widespread plant closings To address labor's concerns that low Mexican wages might undercut U.S. competitiveness

Why do private equity funds use leveraged buyouts?

To take over firms that are considered underperforming

A feature of the Fair Labor Association is that it is not _

a corporate-controlled program

The World Trade Organization (WTO) system lets individual countries institute standards that are "necessary to protect public morals [or] ... human, animal, or plant life or health" or conserve "exhaustible natural resources" as long as such standards __

are not trade barriers

Match the factors that are part of the coordination dimension of global strategy and international management (in the left column) with their features (in the right column).

centralization: Deals with global integration and efficiency Decentralization: Deals with local responsiveness and autonomy

Match the central dimensions of a multinational corporation's global strategy (in the left column) with their descriptions (in the right column).

configuration: Impacts labor relations through its effects on relative bargaining power between corporations and employees Coordination: Signifies an important conflict in multinational corporations between centralization and decentralization

A written statement of standards that a company pledges to follow in its business activities often as part of a corporate social responsibility (CSR) initiative is called a(n)

corporate code of conduct

An effect of the implementation of the shareholder value model of financialization is that _

employees and unions are faced with demands for wage and benefit concessions, layoffs, and stressful restructurings

A feature of a global union federation is that it __

facilitates transnational collaboration via information exchange, publicity, education, and various solidarity actions

The incorporation of labor, environmental, public health, and other standards into trade agreements and the ability to impose trade sanctions on countries that violate these standards is known as

fair trade

True or false: In the global arena, the use of corporate codes of conduct admits that working conditions are entirely dictated by market forces.

false

The pressures on labor relations brought on by globalization are magnified by a multidimensional process called _ in which financial markets, motives, results, and institutions become more important than the production and delivery of goods and services.

financialization

An advantage of globalization is that _

foreign portfolio investment gives capital for entrepreneurs and financing for government debt

The North American Agreement on Labor Cooperation (NAALC), which is included in the North American Free Trade Agreement (NAFTA), is intended to __

prevent social dumping

In U.S. free trade agreements after the North American Free Trade Agreement and its labor side agreement, there has been an evolution toward __

requirements not only to enforce domestic laws but also to abide by the International Labor Organization's core labor standards

In international trade, __ occurs when a foreign competitor is able to unfairly sell something at a lower price than domestic producers, where unfairly means because of a subsidy, not because of greater efficiencies.

social dumping