R404 Exam

yes

are regional integration agreements allowed by GATT/WTO?

regionalization

as global trade rounds have slowed, ______increased over

sustainable

Europeans exhibit more _____________ consumption behavior because they pay more for clothing that they wear longer

standard of living

-a goal of how we would like to live, based on many different things such as health, life expectancy, comfort, wealth, happiness, etc... not easily measurable -not something you can assign a number to, it's expected or experienced

consumer knowledge

Brohsdahl blames the lack of interest in quality on lack of ________ _________ about how things are made

bottoming

Brosdahl suggests the success of fast fashion in the U.S. will eventually lead to ________ of prices, and companies looking for differentiation beyond price

first mover

Liz Claiborne's ______ ________ benefits included: overseas connections, learning and navigating the apparel quota system, innovating in organizational strategy and creating efficiencies that lowered costs

MFA

Multinational firms able to source from multiple production sites = ________ benefit

backward linkages

NAFTA helped create _________ ___________ in Mexico by allowing a textile industry to form when there was already an apparel industry

balance of trade

NX = Exports - Imports (surplus or deficit)

garment

NYC ________ workers were young Jewish women from Russia and Eastern Europe

modernization

Neoliberalist ideas would best support which development theory

Shirtwaist strikers

Society women joining the cause in the name of women's suffrage greatly helped the ___________ ___________ ability to influence change

False

T/F: Because Europeans expect quality clothing, they tend to pay a higher percentage of their income on apparel

false

T/F: Regional integration agreements are always made between neighboring countries

Multinational firms

The article proposed the Multi-Fiber Arrangement benefit ______ _______able to source from multiple production sites

China

The economic development and industrialization of the American South began through southern mills exporting low quality cloth to _______

Japan and other NICs

The next global competitors after British and American export-led growth in cotton textiles were WHO?

first mover benefits

These benefits were given to a company who was the first to move on an idea - the company would tend to beat all of the competition for some time until eventually, other companies made better innovations

North American Free Trade Agreement.

US, Canada, Mexico, lowering barriers to move product freely between each country

maquiladoras

advantages of ______________: Mexico: foreign investment that funds industrial infrastructure, employs labor, ability to serve global markets. US: gets free trade and better prices for consumers, expands our market

GATT

an agreement est. 1987 to stabalize and promote unrestricted world trade and therefore benefit development - "liberalize, (open it up progressively), stabilize and promote unrestricted trade"; allows tariffs/ prohibits quotas & country discrimination

countervailing duties

duties added to countries in response to subsidizing industry i.e. if China subsidizes their textile industry and is giving money to textile producers - the US can apply a tariff of those products because they have a unfair advantage

______ make money

exports

developing

is more of the world developed or developing?

deregulation

removing industry rules from business

Keynesism

see importance in having state regulation in the market; government needs to intercede at times, such as spending during a recession to create economic activity (in the short run, economic output is strongly influenced by total spending in the economy).

MFA

setting up the ____ imposed quotas on the amount that developing countries could export in the form of yarn, fabric and clothing to developed countries. -countries would move to other locations to produce that product or use other fibers

2. customs union

step to economic integration: eliminates barriers in trade among members but members govern themselves; must give up some sovereignty and trust leaders of other countries

1. free trade area

step to economic integration: minimal integration, elimination of tariff barriers, each nation maintains own external barriers; only things traded freely are things produced in those countries

dependency

supporters of the ___________ theory see textiles and apparel as exploiting labor and resources of the developing world to the benefit of consumers in the developed world; they think that those producing goods will remain poor while those wearing the goods tend to get richer

GATT

supposed to be a transparent, stable, orderly basis for trade

forward linkages

taking the yarn from spinning factories to create jobs to turn yarn into cloth, cloth into apparel, and further selling apparel in retail

Tariff

tax on imported goods/services used to restrict trade

does not

the % of income you spend on clothing ____ ___ increase with income increase. Instead, it levels off at 6-8%

Keynesian

the G20 proposed actions that were a shift towards ___________ principles

MFA

the _____ was created for Industrialized nations to protect domestic industries from low cost competition

washington consensus

the advice given by the world bank and WTO that to develop your economy you need to develop DLP principles of neoliberalism

Multi-Fiber Arrangement

the intention of ____ _____ ______ at the beginning of GATT was to protect developed markets from low wage apparel imports; prevented job loss within the textile and apparel industry

apparel

the most labor intensive product?

trade diversion

the only problem to trade integration; using a supplier inside the free trade area, rather than using the most efficient/low cost supplier outside of the area

bottleneck effect

the performance or capacity of an entire system is limited by a single or limited number of components or resources; slowing down production allowed for investments by capitalists to more efficiently meet demand --(point of congestion in a system that occurs when workloads arrive at a given point more quickly than that point can handle them.)

market disruption

the threat of low cost imports at a sizable increase

dependency theory

theory of development based on the idea that the wealth of the developed world is based on the ability to use and exploit resources cheaply from the developing world; there is no notion of a level playing field, the structure of the world only exists to exploit the developing world to the gain of the developed world

neoliberalism

these explain which ideology? Policies should promote individual entrepreneurial creation and growth, economic growth is sustained through self-regulating markets, and a low level of inflation is more important than full employment

takeoff

this illustrated the 2nd characteristic of Industrialization; increase in production speed/technology to meet demand

consumption expenditure

total income - fixed costs =

wealth, standard of living

trade creates _______ and raises _______ of ________

safety commision

triangle fire, factory _______ __________ -minimum wage standards were enacted -child labor laws were enacted -New York became a model of industrial reform

young Jewish women from Russia and Eastern Europe

triangle fire: New York City garment workers during this time were primarily..?

modernization theory

trickle down theory of development involving DLP and breaking from the past; if a country ascribes to a free trade global environment it will industrialize and develop like the western world did

FALSE, they might but this isn't ALWAYS true

true or false: developing countries ALWAYS a have higher income than they will an HDI ranking

disposable income

paycheck after taxes =

regional integration agreements

(RIAs) have the objective of reducing barriers to trade between member countries; at their simplest they merely remove tariffs, but many go beyond that to cover nontariff barriers and to extend liberalization to trade and investment - at their deepest they have the objective of economic union

voluntary export restraint

(VER) politically motivated trade restraint; government imposed limit on the quantity of goods that can be exported out of another country during a specified period of time.

labor abuses

**After the Triangle Fire, the movie comments that private enterprise needs less competition to avoid _______ _________

quota or volume

**Collins readings: The article suggests Claiborne paid most attention to wage differences between production site options because wages determine ______ or ________ available

GATT RULES

*1. trade without discrimination (MFN) 2. protection through tariffs *3. consultation and settlement differences 4. waiver can depart from rules *5. quotas prohibited *6. regional arrangements allowed if barriers aren't raised to outside world

market disruption

-clause written into GATT that allowed countries to put up barriers to low cost imports. Broke discrimination & quota rule and weakened the system -first historic change to GATT, showing us that GATT wasn't as strong of a mechanism after we built this loophole to respond to textiles and apparel

maquilaopolis

-looking at assembly operations, medical/apparel/consumer products. -critique of this modernization theory, supposed to improve standard of living -large barriers why SOL wasn't improving—environmental, companies leaving environ. Behind, companies not regulated that were currently there, the ability of factories to move very quickly was shown as a large barrier -also big point of movie was empowerment of workers on more positive side, collective bargaining happening in that movie

transshipment

-shipment of goods or containers to an intermediate destination, then to yet another destination -prevented by rules of origin; countries had to have substantial transformation of their product to qualify for a second country's quota i.e. add additional fibers such as silk or flax

Engels law

-the lower ones income, the higher % spent on food -if you spend a lot of income on food then you=poverty -as your income increases, amount you're spending on food looks like it's going up but the percentage of your income that's being used is going down

comparative advantage

-you produce what is the most efficient choice out of options for producing - what you can produce better than other products -when a country can produce something at a lower cost than everyone else

Steps to economic integration: (4)

1. free trade area 2. customs union 3. common market 4. economic union

Characteristics of textile industrialization

1. growth under protection 2. increase in production speed/technology to meet demand 3. job loss to technology/increased productivity 4. migration from rural to urban 5. employment of women outside the home 6. poor conditions, workers revolt, labor reform

industrialization

1960's regionalism between developing countries was fueled by the idea that import substitution and protectionism were required for ________________

Gross Domestic Product/Gross National Income

=total income of a country/by person (synonymous to GDP = C+I+G+NX)

better

Amaryta Sen's discussion of movement from GDP to HDI measurements, we moved to HDI because it's ______________ measurement than just looking at income

quality, detail

Liz Claiborne was convinced to import apparel product from overseas when she saw the _________ and _________ of overseas product

deregulation, liberalization, privatization

DLP =

connected

Guest lecturer jonathan rosenthal said there was a long history of social justice connections, that this has been a convo that's happened over a long period of time in many ways attached to working conditions, overall sense we are all ______ in some way

education, life expectancy, income

HDI index measures what 3 things, in order to give a better standard of living measurement?

comparative and AGOA

Haiti's ______ advantage: low wages, proximity, free trade, best free trade deal had an advantage over _____ because it's closer/can keep wages low enough

money

Hans Rosling's basic thesis is that countries are becoming more educated and healthier more quickly and with less ______ than in the past

health

Hans Rosling's speech on development was about how even though income is not rising in developed countries, ______ is still quickly increasing

lower wages

In American cotton textile led production, we see production eventually move from New England to the South. Why?

nondiscrimination

In response to less openness during the 1930's Depression, what principle was established for the trading system? (GATT principle)

GNI

Limitations of ___: -not a standard of living measurement -says nothing about the well being/happiness/access to resources a country has -# can increase but not in a way positively influencing the country (i.e. cigarette sales)

level of consumption

MEASURABLE level of how much a country consumes/spends

multi fiber agreement

MFA =

most favored nation

MFN =

takeoff

Rivoli's term for the launching of the global economy due to industrialization in the west and sustained economic growth based on trade for the first time -having one part of the industry grows other parts of the industry

markets

WHAT are the most potent anti-poverty engines? but only when they work well

WTO

What is GATT called today?

union recognition

What request from the Unions did the Triangle Factory refuse to give into?

Britain

Who was the world's largest exporter of cotton textiles from 1800-1930?

inflation

Why is clothing a "good buy" ? because prices haven't trended with ________

MFA

____ _____ _____ intention was to limit low price/low cost imports into developed countries markets because it was affecting the products we made. -didn't save jobs, didn't adjust industry, and broke trade rules being developed for all countries

full package

____ _________ production is the capability to fully produce garment all in one - source fiber, put it into fabric and create garment i.e. Mexico --one source for the full product

GNI

____ is a measurement of what we are able to consume

HOPE (HEALTH)

_____ (_____) is like AGOA, preferential trade agreement between Haiti and the US. Haiti wanted for this trade agreement is a large third party provision, length of time to be extended as long as possible, allow for third party sources because there are no good apparel sources there

trade policy

_____ _________ globalized textile trade and production quickly, to areas and categories of product that were unprotected

textiles and apparel

_____ and _____ industries are a unique case to the global marketplace because -they provide jobs around the world on a larger scale -adjust to the types of resources in a country; **every country has a part of the industry, so it helps countries begin to develop

multi-fiber arrangement

______ _____ ______ was created for: Industrialized nations to protect domestic industries from low cost competition

trade policy

______ _____ affected textile trade and production by: use of quotas shifted countries that produced. If you were a country that had a quota put on you then you would just move to a country that wouldn't put quota on you. Exapnded production sites, use of fibers, and shifted to countries with the lowest cost labors.

discretionary income

______ income: amount of income left for spending, investing/saving after taxes/fixed (such as food, shelter, and clothing) have been paid. Includes money spent on luxury items, vacations and non-essential goods and services.

global interdependence

_______ __________: -we depend on other countries for materials and labor because we can't produce everything we want/need -advantage: creates wealth and helps us distribute the world's resources more efficiently

protectionism

_______ is closing off or limiting markets. Tools aiding in ___________: subsidies, tariffs, quotas, exchange rates, standards, etc.

mercantilism vs. capitalism

_______ isn't as trade friendly as ________

NAFTA

________ gave Mexico the ability to do full package production because textiles could come from inside Mexico; apparel exports tripled from Mexico by creating backward linkages

modernists

________ see textiles and apparel as helping the world to develop and having positive role in creating jobs, money and investment in countries without resources

exchange rates

_________ ______ are non-tariff barriers to trade because if your currency is cheaper, that is a natural trade advantage because your exports are cheaper, so countries will buy more (and vice versa)

consumption

_________ as a solution to sustainability problems for these reasons: -fashion represents quick and constant change -can slow resource depletion -can address waste reduction

African Growth and Opportunity Act

_________ is a preferential trade agreement between the US and sub-saharan AFrican countries. If it makes less than 1500 income per capita then you can send apparel to the US freely and you can have a third party provision. Part of that apparel can come from Asian textiles that normally would be limited.

Claiborne

___________ had first mover benefits with the global production chain

multinational

____________ companies/large sourcing companies benefited from the MFA years because they could navigate and quickly set up global production chains

neoliberalism

_____________ is most closely associated with Friedman

structural industrialization

_______differences between _______ now versus the past 1. countries are in debt now so they invest differently 2. competition for investment is more intense 3. markets are now more international rather than domestic 4. much of trade is controlled by multinational corporations

refugee camp

a _____ _____ is the best and most simple example of how trade creates wealth and raises standards of living. -(ex. when people move to a place with no resources, they will always find ways to make money through gathering firewood, doing hair, etc.. trading what you can do/have for what you can't do/don't have)

Quota

a ______ is a trade restriction that limits number or value of goods/services that can be imported/exported at a particular time period. -regulates volume of trade between countries

subsidy

a _______ is a benefit given by the government to groups/individuals usually in the form of cash payment or tax reduction. -give to remove a burden

economic growth

a spinning factory helps ________ _________ because it creates forward linkages and has urbanization effects

import substitution

a trade and economic policy that advocates replacing foreign imports with domestic production; country should attempt to reduce it's foreign dependence

triangle fire

due to the ___________ ________; minimum wage laws were enacted, child labor laws were enacted and NY became a model of industrial reform

cotton textile

innovation in ______ _______ production was the ignition switch for the modern economy

negotiated to the penny

because the scale of the industry (we don't look at one unit we look at a bunch. one penny in labor costs makes a huge difference)

neoliberalism

characteristics of _________ include DLP; deregulating and freeing up the world market, giving power to private companies and taking away power from the government

4. economic union

complete integration, single currency, harmonization, freedom of movement; europe is close example - 50 states is perfect example

integrate

countries _______ to gain trade efficiencies which create wealth

apparel

developing countries do ________ manufacturing because it is labor intensive and low skill - it is not hard to learn how to sew, etc.

China

developing countries were nervous about the drop of quota in 2005 because they didn't think they could compete with ________ in a free trade world - a great exporter with low labor costs and great quality

maquiladoras

foreign owned assembly plants (low wage jobs w/ no urbanization affects) -took advantage of 9802 assembly law, textiles that were made in the US would be sent to Mexico to be sewn together free of charge. pre-NAFTA. but assembly law said those textiles had to be made/cut in US and sent to mexico

liberalization

freeing up borders, allowing investment

privatization

if government owns any industry, it should sell to a private, competitive firm

labor

if your country has a lot of labor and not a lot of capital resources, then your apparel jobs will adjust to excess ________

connected by coffee

impact of fair trade and it's relationships...it talked about why you have cooperatives, gave examples of making coffee was an attempt at indiginious people to claim their rights or women to feel empowered

______ cost money

imports

bottlenecks

in early industrialization, how was technology developed to meet demands?

dumping

manufacturers export a product to another country at a price either below the price charged in its home market or below its cost of production - used to get product noticed, unfair advantage

trade rounds

meetings to work to liberalize world trade in WTO -we are in the DOHA

Chinese

neoliberalism with __________ characteristics is a combination of neoliberalist characteristics with centralized one party state controls

millennium round

never launched because of widespread protests in Seattle as to whether trade was actually benefiting people and aiding development. People felt that WTO was not fulfilling its original mission -hadn't had enough time so they didn't know the impact of previous reductions

3. common market

no restrictions on FOP; labor can move freely between borders (no real examples today)

Most Favored Nation (MFN) principle

non discrimination clause - everybody gets the same, best trade deal in the WTO (can't discriminate from other countries)

assembly law

parts are produced in US, shipped freely to Mexico to be put together by maquiladoras and freely sent back

competition

private enterprise needs less _____________ to avoid labor abuses.

power loom

what invention by Lowell in 1812 brought cloth production from Britain to the US?

$15 trillion

what is the total GNI of the US?

$47-52,000

what is the total GNI per capita of the US?

discretionary

what type of income do you use to purchase clothing and fashion items?

foreign direct investment (FDI)

when multinationals come in and direct investments and profits

absolute advantage

you produce only what you produce most efficiently; poses a problem for countries who have no advantages to where they are the absolute best at something

mercantilism

your country will (try to) produce everything and sell it to the rest of the world; holding onto resources to make them valuable

capitalism

your country/company competes in the market economy where trade, industry, and the means of production are controlled by private owners for profit rather than the state