Global Econ Final Exam
The meaning of the name Zimbabwe
"House of stone"
Some white commercial farmers who had been displaced after the land reform programme found sanctuary in _______(See the article by Mbanje and Mahuku (2011) Select one: a. Zambia b. Nigeria c. Mozambique d. All of the above
d. All of the above
The measurable impacts of the Ebola Virus Disease documented by the World Bank include Select one: a. Forgone output b. Lower real household incomes c. Rising prices d. All of the above
d. All of the above
Creation of private property: 2 ways
1.State enterprises directly sold to private individuals and group of individuals (insiders or outsiders) through negotiated settlement or auction or combination of both 2.Use of vouchers given to the population, which can be used to buy shares in state enterprises to be privatized. Its quick but does not provide a quick source of working capital for the newly privatized firms
Socialist countries: application of Marx's ideas, accumulation of capital, law of diminishing return
Communism: Eastern Europe, part of Asia and Soviet Union Rapid Capital Accumulation: industrial capital and heavy industry Law of Diminishing Returns: productivity of capital declines and growth falls Data on Growth Process: Intensive (due to technology - has long term impact on output per person) vs. Extensive growth (due to accumulation of capital - has only short term impact on growth) Running Out of Steam (Eastern Europe and Soviet Union): growth fell dramatically, intense political pressure and political movements, transition process China - outlier Table 4.1, 4.2, and 4.3.
Russian experience: process of reform Fall in output Inequality Middle income country
1st communist revolution occurred in an economically backward country - Russia in 1917 Russia was predominantly agrarian country Lenin and Stalin found Marxist idea's useful: Increase in savings and investment →Rapid capital accumulation → growth Eliminate private property to have control over savings and investment and the country's wealth → ruling state controls the resource allocation industrialization Running Out of Steam (Eastern Europe and Soviet Union): growth fell dramatically, intense political pressure and political movements, transition process Russia: transfer of property rights to individuals led large amounts of Russian assets to be exported 1995-1999: Russia became net exporter of capital (as uncertainty associated with legal regime in Russia after mass privatization)
Land Reform and Poverty in Southern African Development Community countries Read and understand the article. You should be able to recall: >The results -Based on the WSWB approach and Expropriation -Which one is the better land reform approach based on the results -Did land reform help the African countries included in this study? >The conclusions >The policy implications
>The results -Based on the WSWB approach and Expropriation --Estimated coefficients on WSWB and Expropriation are positively statistically significant- supports the argument that this land reform is too slow. --Capturing the destabilizing nature of this land reform approach. -Which one is the better land reform approach based on the results -Did land reform help the African countries included in this study? >The conclusions -Land reform policy failed to improve the living standards of the people living in SADC countries -Why? --Short-time period --Lack of immediate financial support from gov >The policy implicationsThe Impacts of the Ebola Virus Disease in West Africa
More than____ percent of white-owned commercial farms had changed hands since Mugabe came to power in 1980
80
Even though Zimbabwe has only 7 percent of the land area of the region, it has _____ percent of all the reservoir water surface area.
93%
Vietnamese experience: Late comer advantage Experience similar to China's Integration of South Vietnam to North Vietnam in 1975 Doi-Moi reforms
=Late-comer's advantage >Experience similar to China's >Integration of South Vietnam to North Vietnam in 1975 >Doi-Moi reforms -Agricultural reforms: price control removed, farmers were allowed to sell -surplus agricultural products, cooperatives were dismantled and land was given to households who have been the members of cooperatives (land lease for 15 years) -Tax reforms: replaced the value-added tax with turnover tax, reformed income tax -Foreign trade and investment reforms: exchange rate was unified, import tariff gradually decreased, trade barriers removed, trade monopolies ended -Reduction of government spending: closing and selling off unprofitable SOEs and reducing the number of state employees >Rapid economic growth reduced the poverty >SOEs still play important role in the economy >Inflation is a major problem >Agriculture was central for both the Chinese and Vietnamese growth 'miracle".
Colonialization, independence and economic collapse
>Colonization by the British in 1890 >Independence in 1980 >Economic collapse (2000-2005) -Hyperinflation, financial investors fled, gov no longer enforced titles to land, commercial farmland lost its value
Recent Development: Chinese trade with Africa, winners and losers
>Improved economic performance in 1990s. -Improved exchange rates, terms of trade, liberalized fiscal and trade policies -Investments by China and India
Recent development of Chinese economy and difficulties in sustaining the growth, and possible solutions
>New direction of development - late 1990s , early 2000s -Rapid economic growth - more than 10% -Dramatic growth in trade surplus especially with United States (export/GDP increased from 22.7% -38.6%), exports grew at an average 21% and imports - 18% -Dramatic increase in savings and decline in consumption share of GDP (consumption fell by 36%) -Dramatic increase in fixed investment spending (over 40% of GDP) >Difficulties in sustaining the growth: 1. Rapid capital accumulation, law of diminishing return, borrowed and/or adapted technology: have to become more adept at developing new technology 2. Gap b/w export and import: neither political nor economically feasible - countries with trade deficit will hinder trade growth via explicit or implicit protectionism, and such growth will result in comparative advantage distortions that will hold back long-term world growth -Thus rebalancing of economic growth in China is necessary -Previously income losses, pension support, and health care were provided by SOEs -After privatization - these responsibilities were shifted to individuals, as a result families increased their savings as an insurance against future needs In 1978, Chinese Government: "one-child policy" to address the economic and demographic challenges The average Chinese woman was giving birth to more than 5 children in 1970s, and its 1.8 by 2009 One child policy caused rapid drop in fertility rates: Implications Caused China t have one of the most rapidly aging populations in the world: the share of youth shrinks and the share of older people increases. Larger share of GDP - to support elderly and savings increase Decline in availability of workers - slows down the future growth A sex-ratio imbalance : prefers to have boys than girls due to its tradition and culture - creates future social instability
China Global Factory Documentary >Please see the sample questions in moodle >Recall China post-Mao -What changed? -What is Alibaba? >Recall the following regions and what was going on there -Datang -Canton -Shenzhen -Qingdong >The socks firm in France which survived competition from Chinese firms -What was their competitive advantage? >Recall the living and working conditions of factory workers
>Please see the sample questions in moodle >Recall China post-Mao -What changed? -What is Alibaba? >Recall the following regions and what was going on there -Datang -Canton -Shenzhen -Qingdong >The socks firm in France which survived competition from Chinese firms -What was their competitive advantage? >Recall the living and working conditions of factory workers
Recall the objectives of the Thisflag campaign
>Recall the objectives of the Thisflag campaign -To reduce corruption within the government -To change the leadership in Zimbabwe who has had power for 36 years -To change the Zimbabwe constitution -To stop the introduction of bond notes
Speed of transition: Gradual transition versus Shock therapy
Countries like P.R.China and Vietnam adopted a gradual transition mode, however Russia and some other East-European countries, such as the former Socialist Republic of Yugoslavia, used a more aggressive and quicker paced model of transition Shock therapy (Russian and some eastern European countries) - had a negative impact on growth Slow process - more time to create necessary institutions for transition
Land Reform and Poverty in Southern African Development Community countries Read and understand the article. You should be able to recall: >The two main types of land reform and how they differ -WSWB and Expropriation >The three different ways land was expropriated >The purpose of the study >The measure of poverty that was used in this study
>The two main types of land reform and how they differ: -WSWB: market based land reform approach, believed to be less disruptive to economic activity and is favored by the World Bank- drawback- slow paced -Expropriation:the taking of land by the government, with or without compensation. (SADC adopted), fast paced, led to economic sanctions on countries such as Zimbabwe >The three different ways land was expropriated: Full compensation, partial compensation, or without compensation >The purpose of the study: Examines the effect of land reform on poverty in SADC countries while controlling for factors that have been shown to be important in explaining poverty in Africa from 1990-2007. >The measure of poverty that was used in this study: -Lack of adequate income or assets to generate income Isolation due to location or lack of access to goods and services -Vulnerability and risk to crisis -Lack of access to clean water resources -Powerlessness within existing social, political or economic structures -Physical weakness due to lack of nutrition or curable disease -Risk to disease
Chinese experience: Market preserving federalism Agrarian reform of 1976 Privatization and restructuring of SOE in 1995 M-form versus U-form organizational structure Explanation for different reform paths
A. Earlier Beginning - Fast Growth (1976) and successful economic results B. Due to Market Preserving Federalism -Hierarchy of Governments (each level has authority in specific and different areas) -Sub-national governments - Economic Affairs within their jurisdiction -National Government function - Protect Common Market C. Economic Impact: Market Preserving Federalism -Competition (Regional) among sub-national government jurisdiction -Government at all level had hard budget constraint -Experimentation with new policies to enhance productivity D. Dismantling of Commune: -before 1978 commune was the institutional structure -Land was controlled by commune -Commune was controlled by the county government -Production decision was centralized -Output (most of it) was sold to the state at set prices -Little or no role of the market E. Agrarian Reform: started in 1976 -Dismantled the commune and it was replaced by households -Control of production given to farm families, who were given leases for land to farm -Meeting the quotas by delivering to the state, but price paid increased, productions above the state quotas were allowed to be sold at the market prices (increase in agricultural production and income) -Rural-based growth increased the demand for simple manufacturing goods It also provided resources for investment in new manufacturing activities -Township and Village Enterprises (TVE) expanded the production due to increased demand -TVEs were not privately owned nor were they owned by the state -TVEs were controlled by local governments, townships and villages -Households and TVEs paid taxes to the local government -The authority and tax power decentralized F. Special Economic and Development Zones were established due to decentralization: -1980-major fiscal reform (lower level government can keep the excess revenue) -Agrarian reform and fiscal decentralization fostered market development G. Initial reform efforts were not aimed at direct privatization of government owned firms: Dual Track approach to transition - as an efficiency-enhancing reform process -Plan Track: central state owned firms were allowed to operate under central planning -Market Track: new market-oriented firms were created -Significant structural changes: share of employment and the share of industrial output by SOEs declined H. Restructuring of State Owned Enterprise in 1995 -Privatization of Small Firms -Layoffs of SOE workers -Restructuring of the remaining SOEs (Mergers, Conglomerates) -The largest SOEs remain under central control -Incentives for Local Governments: -Additional reforms in tax, fiscal, monetary and banking policy - hardened the budget constraints faced by local government -Increased competition from non-state
Russian Experience
A. Process of Reform: 1991- Michael Gorbachev resigned as the president of the Soviet Union Russia and other republics declared independence 1992 - most prices were liberalized and massive privatization, shares of state-owned enterprises were transferred to managers, workers, and the public 1994: 70% of the economy was privately held 1996: Yeltsin introduced "loans for shares" (number of natural resource based firms were transferred to existing industrial groups in return for loans to the government) and made business oligarchs to gain control of much of the Russian economy B. Dramatic Fall in Output: very disappointing (GDP fell by 30% during 1991-1998) Before contraction, Russia's GDP per capita was around $8000 (1/3 level of the USA) Russia was not poor, but ranked as middle-income country far behind the advanced industrial countries Much of the output produced in 1990's was military or poor quality consumer good with low demand In early stages of transition resources were reallocated: fall in GDP but beneficial (stopped wasteful production) Decline in official economy and an increase in unofficial economy (unregulated, untaxed and underground) C. Inequality Average standard of living didn't dramatically fall Number of Russian travelling abroad: increased from 1.6 millions in 1999 to 4.3 millions in 2000 Shares of households with radio. TVs tape recorders, washing machine, refrigerators, vacuum cleaners increased Much of inequality But everyone benefited (% of people with running water, access to hot water, and central heat had increased) D. Middle Income Country Few groups dominate big business Corruption (common for developing countries) Mixed-capitalist system
One of the most important observations from the study on China-Africa relations by Taivan, Nene and Boubacar (2015) is that former British colonies seem to be the most beneficiaries of trade with China. Select one: True False
F
The collapse of the agricultural sector led to mass exodus of commercial farmers form Zimbabwe to other countries such as India and Egypt. T or F
F
The economic relationship between African countries and China dates back to 1946. Select one: True False
F
Pre-Colonial Period: Economic Efflorescences, low population density and Atlantic slave trade
Economic Efflorescences Use of iron, variety of crops, dependent on raising cattle, similar to african continent Exogeneous shocks and limits to the enviro=end efflorescence low population density 47 million ppl in 1500 C.E. similar languages, intensification of agriculture and division of labor were more limited, slave labor became destabilizing factor Atlantic slave trade (lasted 400 years) 13 mil people sent to Brazil, Caribbean, and North America- rapid expansion of plantation agriculture - destroyed African economies Guns flowed into Africa and fueled the instability High return to slavery increase the revenue
Success Story: Botswana
Effective institutions-property rights, central gov played important role, gov program to provide cheap drugs to stop the spread of HIV/AIDS
A major question concerning the factor-flow view of migration is whether there is any evidence that wage rates are becoming equal through international trade. T or F
F
According to the Grabowski, Self and Shields textbook, the future of Africa depends on three important and interlinked factors: economic, political and social. T or F
F
Migration will reduce both the probability of employment and the wage rates in the Harris-Todaro model. T or F
F
Failed State: State as Monopolist Over Violence within the boundaries of the state
Failed State: State as Monopolist Over Violence within the boundaries of the state Failed State in Africa: No Longer has a Monopoly Most african states remained extractive and illegitimate Changes in structure for producing power declines with the size of the economy, population, and society
The International Monetary Fund has one central purpose: to promote economic and social progress in developing countries by helping to raise productivity so that their people may live a better and fuller life. Select one: True False
False
The willing seller willing buyer (WSWB) land reform approach is not favored by institutions such as the World Bank as it is disruptive to economic activity. Select one: True False
False
Intensive growth vs. Extensive growth
Intensive growth (due to technology - has long term impact on output per person) vs. Extensive growth (due to accumulation of capital - has only short term impact on growth)
What did Patson Dzamara a Thisfag activist had to say about the bad governance in Zimbabwe?
It is a fact that Mugabe and his ZANU PF have a history of enacting draconian laws which scare away investors Zimbabwe's industrial utilization capacity is at 15% (1950 levels). Investors have fled Zimbabwe on their own not because anyone told them to leave.
Colonization: extractive in Africa
Limited development of physical infrastructure Biased educational system Extreme inequality Illegitimacy Persistence through time
Marxist theory and its main ideas
Marxist Theory: main ideological base of socialism Marx: capitalist profit is generated as a result of the exploitation of labor by the owner of capital This profit will be used to finance the creation of new capital and expansion of capitalist system Capitalism is a dynamic system: spread worldwide and destroying the old traditional economic system Capitalism will lead to increased misery for the working class and strictly limited ability to purchase goods Production capacity will outpace the demand, unemployment rises and firms collapse the capitalist system will be overthrown
Risk Management and Lineage Group as a protection against risk
Risk Management and Lineage Group as a protection against risk Lineage group: an extended, which radiates outward from the nuclear family, increasing the extent of obligations to assist other members. Protection against risk: diversification of income, consumption smoothing Economic impact of lineage groups: lack of specialization and limited learning by doing
The Impacts of the Ebola Virus Disease in West Africa Read and understand the PowerPoint Presentation on Ebola. You should be able to recall: The country where Ebola originated The countries that were affected by Ebola The measureable Impacts of Ebola in West Africa The Channels of Impact Short-term (2014) impact on output The short-term(2014) fiscal impacts
Read and understand the PowerPoint Presentation on Ebola. You should be able to recall: The country where Ebola originated Originated in rural Guinea The countries that were affected by Ebola Liberia Sierra Leone Guinea Nigeria USA Senegal Spain Mail UK The measureable Impacts of Ebola in West Africa Forgone output Higher fiscal deficits Rising prices Lower real household incomes Greater poverty The Channels of Impact First channel Direct effects of the sickness and mortality direct impacts; consume healthcare resources, subtract people from the labor force Second Channel The behavioral effects resulting from the fear of contagion; closes places of employment, disrupts transportation, motivates gov to close borders Short-term (2014) impact on output Foregone output Guinea This reduced growth from 4.5% to 2.4% Liberia Reduced growth from 5.9% to 2.5% Sierra Leone Reduced 11.3% to 8% The short-term(2014) fiscal impacts Liberia $133 million (5.1% of GDP) Sierra Leone $95 million (2.1% of GDP) Guinea $120 million (1.8% of GDP)
Read and understand the Article on China-Africa relations posted in moodle. Recall the objective of this study Identify the relationship between China and Africa in the 1950s Document the China-Africa relationship in the 1990s to present. Identify the main findings in this study and how they differ according to colonial origin. Identify the main conclusions and policy recommendations. There is a PowerPoint presentation which summarizes the article on China-Africa relations.
Recall the objective of this study To provide insight on the China-Africa relations and the possible impacts of these relations on the economies of African countries >Identify the relationship between China and Africa in the 1950s -In 1956, China and Africa started to form relations. They focused on political, military, foreign direct investment and foreign aid. -During the liberation struggles of most African countries, which mainly took place between the 1950s and mid-1980s, China provided most of these countries with military aid ranging from military training to ammunition. Document the China-Africa relationship in the 1990s to present. Former French colony is associated with a lower per capita GDP growth rate averaging of 5.68% compared to 3.48% for former British colonies Document the China-Africa relationship in the 1990s to present. 1990's marked the beginning of increased Chinese aid, trade and investment in Africa. Although the growth in trade relations between China and Africa slowed down during 1998 Identify the main findings in this study and how they differ according to colonial origin. Economic growth in Africa is Negatively correlated with commodity exports to China Positively correlated with commodity exports to china relative to total exports Identify the main conclusions and policy recommendations. Former British colonies outperform their French counterparts Former french colonies seem to be the most beneficiaries of trade with China Commodity export seems to exert a great growth enhancing effect when compared to total exports
According to Oliver and Atmore (1994), Buganda, in East Africa, had become the chief naval power on Lake Victoria and was characterized by rapid growth and in trade. T or F
T
Assume you are using data on 54 African countries to run a regression with growth rate in per capita gdp is the dependent variable. A negative sign on the initial per capita GDP coefficient provides evidence that the gap between poor and rich African countries is getting smaller. Select one: True False
T
Botswana's success is a result of the implementation of good policies by the government, which flowed out of an institutional structure that was conducive to economic growth. T or F
T
In Zimbabwe, commercial farmland lost an estimated three-quarters of its aggregate value between 2000 and 2001 alone as a result of lost property titles. T or F
T
In consumption smoothing, farmers save and accumulate assets during good times and consume these during bad times. see Grabowski,Self and Shields T or F
T
It is estimated that in 1500 C.E. approximately 47 million Africans lived in farming communities scattered throughout the continent. T or F
T
King Leopold of Belgium's philosophy was that "colonies should be exploited, not by the operation of a market economy, but by state intervention and compulsory cultivation of crops to be sold and distributed by the state at controlled prices." T or F
T
Market systems are based on the principle of private property. T or F
T
Sub-Saharan Africa has undergone major changes since the mid-1990s, especially with the increased involvement of countries like India and China. T or F
T
The World Bank itself comprises two major organizations : the International Bank for Reconstruction and Development and the International Development Association (IDA). Select one: True False
T
The crucial aspect in transition, i.e. from socialism to market based socialism) is the establishment of market exchange. This is indeed a difficult thing to do. Game theory provides insight into the difficulty of establishing a market exchange. T or F
T
According to Harris-Todaro urban bias model, because the government's urban constituency, through its ability to exercise significant political power, achieves a wage rate in the urban area that is above the market clearing wage rate, this creates ____in the region. Select one: a. high inflation b. employment c. a boom d. None of the above
d. None of the above it creates unemployment
How the Loss of Property Rights Caused Zimbabwe's Collapse by Richardson
The gov
The Impacts of the Ebola Virus Disease in West Africa The socio-economic impact of Ebola in Liberia The socio-economic impact of Ebola in Sierra Leone
The socio-economic impact of Ebola in Liberia November 2014 7000 Ebola cases were reported Nearly 2500 deaths Travel bans Most have been lifted Closed markets Slowly reopening By February 18, 2015 9000 Ebola cases were reported Nearly 3900 deaths By April 8, 2015 9,860 Ebola cases were reported 860 more cases since February 2015 Nearly 4400 deaths 500 more deaths since February 2015 Employment situations 40% of the respondents reported not working since the start of the crisis compared to 41% in January Most agricultural households report that their 2014 harvest was smaller than the previous year, though the link to EVD is not clear Food insecurity remains high, but has seen significant improvement in rural areas Due to the completion of the rice harvest The use of public services appears to be rebounding to level seen before the crisis The socio-economic impact of Ebola in Sierra Leone As of January 4, 2015 10,000 Ebola cases were reported Nearly 3,000 deaths By April 8, 2015 12,000 Ebola cases were reported Nearly 3,800 deaths employment rates recovered some losses during the outbreak, main impacts felt in the urban areas Business closures Food insecurtiy
Major characteristics of transition process
The transition process is usually characterized by -the changing and creating of institutions, particularly private enterprises -changes in the role of the state, thereby, the creation of fundamentally different governmental institutions and the promotion of private-owned enterprises -markets and independent financial institutions. In essence, one transition mode is the functional restructuring of state institutions from being a provider of growth to an enabler, with the private sector its engine. Another transition mode is change the way that economy grows and practice mode. The relationships between these two transition modes are micro and macro, partial and whole.
What are the major outcome of Russian transition process? Select one: a. output declined dramatically b. standard of living decreased substantially c. corruption became a major problem d. all are correct
d. all are correct
What are the important stages on transition process? Select one: a. Creation of private property rights and their enforcement, transfer of control over property to private hands b. elimination of price system c. elimination of land ownership d. none of them
a. Creation of private property rights and their enforcement, transfer of control over property to private hands
Two countries were hit the hardest by the Ebola Virus Disease. Which one of the following pairs of countries were hit the hardest by the Ebola Virus Disease? Select one: a. Liberia and Sierra Leone b. Sierra Leone and Guinea c. Guinea and Liberia d. Botswana and Guinea
a. Liberia and Sierra Leone
Patron-Client Political structure:
environment where illegitimacy came to dominate, ruling elite provide their clients with certain benefits, the clients in return provide political support
Remember the Thisflag movement and who the movement's leader is.
Thisflag movement was protesting the corrupt government in Zimbabwe Pastor Evan Mawarire was their leader but is now exiled to the USA
Two types of colonization: extractive and developmental
Two types of colonization: extractive and developmental Extractive: take surplus or wealth from colony as quick as possible. The purpose of each colonization process is to create a set of rules that maximize the predatory activities of the state Developmental: creating institutions that are developmental in nature; creates incentives for savings, investment and innovations
Recall the multi-currencies used in Zimbabwe
US dollar, South African Rand, Pound Sterling, the Euro, Botswana Pula, Chinesr Yuan, Japanese Yen, Indian Rupee, Australian Dollar, Bond Coins
Urban Bias and Migration: over urbanization and informal sector
Urban Bias and Migration: over urbanization and informal sector. Resources tend to be more readily available in urban residents, more privileged. Harris-Todaro Model of Migration: labor moves to urban region with a higher wage rate, whereas rural regions are much poorer and have little capital per worker. Wage rates fall as the supply of labor from rural area to urban increases and rise in rural areas until they will be equal. Excess supply of labor in urban areas created unemployment; slums and shantytowns; lack of clean water, sewage and electricity
In a traditional system of organization, how goods are distributed is often significantly influenced by Select one: a. religion b. caste c. social obligations d. All of the above
d. All of the above
Regarding the outbreak of the Ebola Virus Disease in West Africa, which of the following is among the behavioral effects resulting from the fear of contagion? Select one: a. transportation disruptions b. disruptions in domestic and international markets c. disruptions and diversion of government services d. All of the above
d. All of the above
After reading Chapter 5 of the Grabowski,Self and Shields book, which of the following statements is true? Select one: a. One of the advantages of job creation in the rural areas over urban job creation is that the costs associated with both migration and urban congestion would be reduced. b. One of the disadvantages of job creation in the rural areas over urban job creation is that the costs associated with both migration and urban congestion would be increased. c. One of the disadvantages of job creation in the rural areas over urban job creation is that unemployment and problems associated with employment in the urban areas is increased. d. One of the disadvantages of job creation in the rural areas over urban job creation is that the costs associated with both migration and urban congestion would remain the same.
a. One of the advantages of job creation in the rural areas over urban job creation is that the costs associated with both migration and urban congestion would be reduced.
Questions persist about environmental quality and development, and this is critical in understanding sustainability of development, especially for for transition countries. Broadly speaking, two schools of thought address environmental quality and development. One of the two schools of thought Select one: a. believes that development and environmental improvement occur simultaneously b. believes that the environment has a negative impact on sustainable development. c. believes that the environment has a negative impact on development. d. believes that there is no relationship between the environment and development.
a. believes that development and environmental improvement occur simultaneously
Transition economies
an economy which is changing from a centrally planned economy to a free market. Transition economies undergo economic liberalization, where market forces set prices rather than a central planning organization. Trade barriers are removed: a push to privatize state-owned businesses and resources, and a financial sector is created to facilitate macroeconomic stabilization and the movement of private capital. The process has been applied in China, the former Soviet Union and Communist bloc countries of Europe and Asia
______________attributes the decline in food production from 2001 on wards to the massive sabotage in the agricultural sector by embittered white farmers as they either left their farms or the country altogether. (see the article by Mbanje and Mahuku (2011). Select one: a. Richardson (2007) b. Charamba (2007) c. Zvobgo (1986) d. Chombo (1998)
b. Charamba (2007)
_________________contends that, when a country is under sanctions it always looks elsewhere for alternative assistance. Select one: a. Frith (2006) b. Flower (1987) c. Chombo (1998) d. Gono (2007)
b. Flower (1987)
The ________is that the creation of jobs to combat urban unemployment causes more unemployment. Select one: a. Malthusian trap b. Todaro paradox c. Harris paradox d. Todaro-Harris paradox
b. Todaro paradox
A transition economy is an economy which is Select one: a. changing from a centrally planned economy to a totalitarian economy b. changing from a centrally planned economy to a free market c. not changing but only transitioning from developing to developed economy d. changing from feudalism to free market
b. changing from a centrally planned economy to a free market
The International Bank for Reconstruction and Development (IBRD)'s first loans were extended during the late 1940s to finance the reconstruction of _____________. Select one: a. the war-ravaged economies of Eastern Europe. b. the war-ravaged economies of Western Europe c. the war-ravaged economies of Eastern Asia. d. the war-ravaged economies of Southern Africa.
b. the war-ravaged economies of Western Europe
The ____________trade was conducted mainly by European traders based on the Western Coast. Select one: a. Midwestern b. Eastern c. Atlantic d. Western
c. Atlantic
_______in the Soviet Union and Eastern Europe evolved into a highly centralized command economy with most property controlled by the state. Select one: a. Traditionalism b. The market economy c. Communism d. None of the above
c. Communism
____________states are those whose major purpose is to extract surplus or wealth from the colony as quickly as possible. Select one: a. Destructive b. Constructive c. Extractive d. None of the above
c. Extractive
In the 1980s and 1990s, _______ was the "bread basket" of the Southern African region. see the article by Mbanje and Mahuku (2011) on European Sanctions on Zimbabwe Select one: a. Botswana b. South Africa c. Zimbabwe d. Malawi
c. Zimbabwe
The Harris-Todaro model has influenced how economists view Select one: a. tradition b. democracy c. migration d. inflation
c. migration
The taking of white owned farms by landless Zimbabweans in 2000 reduced agricultural output by almost ____%. See the article by Mbanje and Mahuku(2011) Select one: a. 40 b. 75 c. 55 d. 60
d. 60
All human societies have to answer three economic questions: Select one: a. What is going to be produced? b. How are the chosen goods to be produced? c. Who is going to get these goods? d. All of the above
d. All of the above
Due to the debilitating nature of the EU sanctions, Zimbabwe has come up with a 'Look East Policy' which is grounded on attracting Eastern countries such as _______________ to invest in Zimbabwe as well as to assist it with the much needed foreign aid . (see the article by Mbanje and Mahuku(2011). Select one: a. China b. Russia c. many other Asian countries d. All of the above
d. All of the above
Factors that determine the type of colonization:
mortality rate of settlers and institutional transfer mortality rate of settlers: experienced by the first settler in the colony institutional transfer: educational system expansion, tax system created inequality, property rights not developed
3 different forms of economic organization: traditional system, market system and socialism
traditional system: appealing to tradition (Amish communities in the USA) market system: Private Property + Decentralized Decision Making socialism: State Ownership + Centralized Decision Making