GOV 312L Exam 3

According to the reading (Chapter 25: Globalization), what are the chief indicators of the increase of globalization since World War II? What is comparative advantage and how does it contribute to aggregate economic gains for states from trade? How does trade contribute to the economic sources of order in the international system?

Fueled by global trading regime centered on GATT and WTO that has encouraged and sustained dramatic reductions in political barriers to trade like import tariffs Supported by technological developments associated with internet that made possible to trade services across great distances Made it possible for multinational corporations to drive down costs and consumer prices by outsourcing important services and stages of production to different locations around world Growing levels of economic flows or transactions across national borders demonstrate market integration International trade has accounted for an increasing proportion of national economic activity Comparative advantage (simple definition) economy's ability to produce goods or services at a lower opportunities cost compared to other trade partners. Comparative advantage: gains from trade stem from difference in relative efficiency of individuals, firms, or whole economies in production of some mix of goods; captured in comparative costs of producing some good and alternative good across two countries; countries could gain from trade by specializing in production of those goods in which held greatest efficiency gains relative to all other goods; generate economic benefits for all countries even for country capable of producing all goods at lower costs than international competitors -suggests that governments can boost national income through mix of policies that promote international trade and encourage greater specialization in sectors that possess greater efficiency advantages over rest of domestic economy Markets help structure interactions among individuals and groups; by building new economic connections across national boundaries. globalization increases role played by markets in generating order in international system -important source of order -influence distribution of political authority within and between states and help create political order -democratic transitions in some countries can be attributed to political influence of commercial class strengthened by international trade -rising income levels within countries make presence of democracy more likely; globalization supports democracy -alters quality of political interactions among states

Describe some of the efforts by the United States to promote democracy around the world. What are the political challenges associated with American efforts to promote democracy? What are the benefits and drawbacks associated with promoting democracy around the world?

-After WWI: Wilson sought to leverage American participation to expand democracies. Transition in Germany and supported self-determination for former colonies. -Cold War: took a backseat to containing communism. rhetoric of explaining superiority of democracy, but the US aligned itself with friendly authoritarian regimes and actively undermined democratic leftist groups. Anticommunism trumps democracy as seen in Chile and Iran. US supported right-leaning dictatorships. -End of Cold War: Collapse of communism showed the US they could spread democracy and have greater security within the United States. -After Cold War: right after the Clinton admin justified intervention in Yugoslavia b/c of human rights abuses and wanting to spread democracy. Democracy promotion huge portion of neoconservatism-> middle east presence to counter the threat of terrorism after 9/11. There are skeptics of the promotion of democracy by force and military. Pros: Bolsters legitimacy and increases military security. Cons: Some are skeptical that the promotion of democracy is by force and military. Promoting democracy mainly means intervening in third world problems.

What are the two main dilemmas facing NATO and how has the Trump administration addressed these dilemmas?

2 dilemmas: European shirking and the united states being a reluctant hegemon. European shirking not spending enough on militaries during cold war and after cold war ended. Eisenhower complained of allies because they won't make sacrifices for their own defense. Every president after have made similar complaints. // Trump has also demanded that they step up and do what they are required to do, spend two percent of their gdp on military security. US has been a reluctant hegemon. Trump has questioned that the costs of being in NATO have outweighed the benefits to the United States. Trump's proposed remedies are radical: called NATO obsolete, suggested that if Europe doesn't step up then the US won't honor article V which sees the attack on any NATO country as an attack on the US. Questions US leadership of the alliance and threatens the entire security apparatus.

Which of the following is an example of public goods that an international hegemon helps to provide?

A) A currency acts as a medium of exchange B) Safe Shipping Lines C) a market for distressed goods in global economy d) ALL OF THE ABOVE

Financial tension may arise from large scale migration of low skilled labor into developed countries due to:

A) Decreasing wages as supply of labor increases B) net fiscal costs related to social welfare increase C) BOTH

The creation of international organizations provokes principle-agent tensions with their member states. What factors worsen this principle-agent relationship?

A) Multiple Principals B) Agency Slack C) Shirking D) ALL OF THE ABOVE

How might international economic organizations, like the WTO and the IMF, facilitate economic cooperation among states and higher levels of international trade?

A) provision of enforcement mechanisms to punish states for cheating on agreements b) help monitor compliance to prevent cheating on agreements c) reveal states' preferences and interests to reduce uncertainty and build trust d) ALL OF THE ABOVE

What is the International Monetary Fund? What are its main functions? What is the main source of its influence in the international economy? What is conditionality and how does the IMF use it to promote economic reforms within countries? Why does the U.S. have so much influence within the IMF?

Acts like a bank to oversee pool of capital created by member countries Limits exchange rate fluctuations Lender of last resort: help governments in exchange rate crisis stabilize reserves with loans Has conditionality: demands conditions that change economic conditions in the country and enhance long term ability to repay -loans as multiple disbursements so get partial money then must implement reforms before get more -often imposes real pain: cut tariff barriers, cut budget deficits Power stems from its willingness to lend when no one else will -good housekeeping seal of approval necessary for private capital to come back in Voting power not equal and set by relative contribution to fund US biggest shareholder so has lots of influence on terms of emergency loans or bailouts Often relaxes conditions for strategic reasons

The functions of money include:

As a store of value, which facilitates the accumulation of wealth over time.

According to power transition theory, why does a shift in the distribution of military power between two states increase the likelihood of war between them?

B. The declining state chooses to attack before the growing military and political power of its adversary are used to impose a series of unfavorable political concessions

What is the basic scientific claim about the causes and extent of climate change? What are the main environmental consequences that scientists fear will result from climate change?

CO2 in the atmosphere increasing exponentially. CO2 is a heat trapping gas and levels have increased since the industrial revolution began. Average global temperatures increasing at the current rate of CO2 emissions. Cause droughts and changes in wind patterns. Ocean levels rising and endanger coastal communities. Hundreds or thousands of years away, but worries that we will hit a point of irreversible change.

4. How can power transition theory be used to understand the evolution of the maritime disputes in the South China Sea?

China is an ascendant power. Economically, China has used the money earned to bolster defense spending, however spending doesn't equate to troop size. Essentially this means that China is economically capable of competing with the US but not yet militarily due to technology differences and different alliance commitments (US has more advanced technology so can make more advanced weapons, and they are a part of NATO so they have more allies). · South china sea is the hot button issue for a potential Great Power war. China keeps building islands with military bases and redrawing water zone lines. It's pissing the US and neighboring countries off. China has been building islands in South China sea for their military, and US is worried that they will block it off, which is bad for US because 20% of trade happens in South China sea, and the whole world has a claim on it for trade, not just China. China could be trying to disrupt the international system and expand its political power. If the problem continues, the US and China may become involved in Great Power War.

How do trade and globalization shape political relations and order in the international system?

Create anti-globalization political pressure Big in 2016 election -Trump: against some trade policies that his base agrees with; said would cut imports and slow integration to broad global economy

How might international economic organizations, like the WTO and the IMF, facilitate economic cooperation among states and higher levels of international trade?

Creates joint reduction in tariff barriers Monetary cooperation: multiple countries coordinate monetary policies to preserve stable exchange rates Foreign aid . Emergency lending Can provide enforcement mechanisms (WTO with judicial panel and IMF with conditionality of loan packages) Help reveal information about state interests Reduce distributional challenges.

What does globalization in financial terms look like?

Integration of national markets into global economy Movement of capital across boundaries; help foreigners invest in US economy Lend money to US government purchase treasury bonds; make cars in US with foreign companies Help to run budget deficits and spend more than take in by taxes

What is the democratic peace theory? How do the factors that contribute to democracy's influence over foreign policy in general - electoral constraints, institutional constraints on power such as checks and balances, and a shared democratic identity - help to explain, in particular, peaceful relations between democracies?

DPT suggests that military conflict is unlikely between two democratic states and that democracies will remain peaceful with other democracies but not with autocracies. This is achieved through electoral constraints because it raises the political cost of war. If an unpopular war is waged, the administration will suffer through public opinion or jeopardize chances of reelection. Institutional checks and balances helps solve the commitment problem that states face, and a shared democratic identity means that compromise is more likely and actors don't want to pursue aggressive FP that is unpopular.

4. How and why has Democracy Promotion been a more or less important element within U.S. foreign policy over the years?

Democracy promotion has been a major facet of most of the interventions of the United States for several decades. The existence of widespread democracy has bolstered American legitimacy and increased its military security.

What is the Bretton Woods economic order? What were the main forces that served as an impetus for the U.S. to construct the Bretton Woods order? What are the main organizations that emerged from Bretton Woods?

Emerges in final stages of WW2 where US supports creation of international organizations to ensure economic growth through international trade Impetus from great depression and WW2: have collapse of economic cooperation; want to construct organizations to support reduction of trade barriers, political cooperation to sustain globalization, and have peace and economic growth WTO, IMF, GATT as examples.

According to the reading (Chapter 20: Global Governance), what are the incentives for global governance through international institutions? How are efforts at global governance confronted by the collective action problem? Once international agreements are established, ,what types of problems of compliance and enforcement do international organizations face?

Externalities are costs or benefits that are felt by the parties outside of specific interactions and they have a distributional stake in the outcomes of events such as new trade agreements, intervention by a third party. Global governance to try to reduce something like carbon emission risk that everyone agrees in the benefits but no one wants to pay for it. Enforcement mechanisms are needed via institutions and organizations. The problem with compliance and enforcement is that each state determines how to enforce it in their sovereign land, thus it is tough to have all parties comply with the international agreement. Ex: Paris Climate Agreement

The WTO preceeded the GATT

FALSE

According to lecture, the strategic interests of the United States in the Middle East have been left unchanged by increased oil production from shale in the United States.

False

According to the Vox video, the conflict between Israelis and Palestinians has been going on for millennia. These groups have lived in constant state of conflict over control over the same land for more than a thousand years.

False

Attorney General William Barr and the Department of Justice took an expansive approach in their use of redactions on the Mueller report. More than 50% of the report was blackened out to remove information deemed too sensitive for the public to see.

False

China is a member of the Trans Pacific Partnership

False

China's recent increase in naval and maritime activity in the South China Sea is supported by other states in the region because they recognize it will boost overall commerce and security in the region.

False

Family-based migration (also known as chain migration) is the process of migrating an entire family across international borders.

False

If interest rates in the United States increase, the value of the dollar relative to other currencies should fall.

False

NATO was created primarily to support free trade in Western Europe

False

Ricardo's theory of comparative advantage suggests that specialization and international trade reduce the national income of an economy.

False

The Mundell-Fleming Trilemma suggests that the United States could simultaneously pursue monetary policies that support fixed exchange rates, capital mobility, and monetary autonomy.

False

The Paris Climate Accord relies on strict, enforceable national limits on carbon dioxide emissions to address the environmental problem of climate change.

False

The Tragedy of the Commons suggests that people and states have a general set of incentives that encourage them to limit their consumption of public resources.

False

The United States supports China in the maritime disputes over access to the South China Sea.

False

What is the GATT? What is the WTO? How do these organizations differ? What are some of the norms, principles, and rules associated with the GATT and WTO? How does the dispute settlement mechanism in the WTO support international trade?

General Agreement on Tariffs and Trade -multilateral org designed to support reduction of trade barriers on a reciprocal basis -provided a series of rules that guide negotiating rounds during the cold war -No enforcement capabilities and disputes handled on bilateral basis The World Trade Organization -institutionalized a dispute settlement mechanism with established procedures for filing grievance, investigating complaints, and punishing defecation -ensure states uphold existing trade concessions negotiated -judicial panel can enforce these obligations by authorizing compensation to injured parties in form of trade sanctions; plaintiff has a lot of discretion on where to impose tariffs -keeps global economy open by punishing states pursuing protection -ineffective over the last decade in securing further trade liberalization because limited support in developed world

What are the two main political bodies of the UN? How can they confer legitimacy? Which states have the most power within these political bodies?

General Assembly 2. Security council: US, UK, Russia, China and France (Has the most power because on security council) are permanent members who have veto power. There are 10 additional members that rotate -legitimacy comes from the fact that the UN reflects the global public opinion and makes it easier to secure alliances. → people are more likely to approve of war if the UN also endorses it

What is the Ricardian model of trade? Describe the processes by which it suggests that trade and specialization can increase aggregate national income.

Globalization helps to raise national income through specialization and trade Illustrated by comparative advantage Policy implication: states should eliminate trade barriers to max economic growth

Understand, explain, and give examples of how international institutions/organizations shape international politics.

International institutions and organizations explain how states act and what constitutes appropriate vs inappropriate behavior. Additionally, they allow for the cooperation among states. Institution regulate behavior. Rules that are designed to minimize conflict in the international system. Ex. sovereign rights - one state recognizes another state's sovereign rights and both agree not to violate each other's territorial borders. Institution also give us information about other states in the international system. Rules do not only minimize conflict, but they also help identify violators of rules in the international system and identify threats. Organizations: shape international politics by making it easier to predict how states will act and their willingness to cooperate based on their membership in international orgs

What is democracy? Describe Robert Dahl's three "procedural minimal" conditions of democracy.

Hard to define- free and fair elections have become a catalyst for democracy in which citizens have some determined amount of power in deciding the political outcomes of the country. Dahl's minimum: 1. Public contestation (civil rights and liberty): individual freedoms and electoral competition. Citizens can freely express themselves and receive info from the media. 2. Inclusion: universal suffrage, universal and equal participation of all segments of the society 3. Democratic sovereignty - elections must result in elected officials to carry out political influence. (so if it was made by unelected bodies like military or religious authority, then it is not democratic)

What are the important characteristics that make the international oil market unique? Why is it important that oil is traded in a single open market?

Has single global market -spot and future markets so traded contracts deliver barrel of oil at specific date; don't usually physically exchange oil -important facts in debates about energy independence (domestically) -total global petroleum consumption at 90.4 millions barrels/day -US consumption at 19.0 mbd That oil is traded in a single, international market means that it's price is determined internationally, based on the future exchanges of contracts that occur in spot markets all over. This matters because the benefits of energy independence are limited. Even if the U.S. were to produce all the oil it consumes domestically one day, the U.S. would not be insulated from shocks in the Middle East or elsewhere that strongly affect oil prices. This is a market run by a cartel, that is relatively inelastic in the short run, meaning that demand is not strongly responsive to shifts in price, and for which there are few substitutes at similar prices. - Carolina Moehlecke

According to this module's reading, what is hegemonic stability theory and how does it relate to the provision of public goods and the free rider problem in international relations?

Hegemonic stability (simple term) - international system is more likely to remain stable when a single nation-state is the dominant world power, or hegemon. Hegemonic stability theory refers to the concentration of global economic activity that results in high trade within the global economy because the hegemon has self-interested economic leadership and coercive strategies (there is one hegemony that dictates trade in the international system). Provision of public goods through cooperative trade by advocating for low trade barriers so that states can develop (can be bad for the Hegemon, because low export tariffs can put people out of jobs domestically). Having a hegemon rule the trade international system can be beneficial because they will use the hegemon currency for trade, which is more stable. The system is a collective good which means that it is plagued by a "free rider" syndrome (recap: when those who benefit from resources, public goods, or services do not pay for them, which results in an underprovision of those goods or services) . Thus, the hegemon must induce or coerce other states to support the system. For instance, the US system tries to produce democracy and capitalism, thus it champions human rights and free trade. Other nations will try to enjoy the benefits of these institutions, but will try to avoid paying the costs of producing them. Thus, the US must remain committed to free trade even if its major trading partners erect barriers to trade. The US can erect its own barriers, but then the system will collapse.

What is a trade deficit? How are trade deficits related to foreign capital inflows and investment in the United States?

Import more than export Exporters see less demand which can slow economic growth in some sectors, but consumers benefit from cheap products Consistent ones can generate a problem because of their relationship to the balance of payments; thought of as national accounting rule (current account or ratio of exports to imports must balance with capital account which is ratio of capital outflows to inflows) -When run, a deficit must compensate through running a capital account surplus so borrowing more money than lending; overtime lead to larger debts to foreigners and these can have significant implications for future economic growth and government decisions over taxing and spending.

What is interstate cooperation? What are some of the primary impediments state face when trying to reach cooperative settlements with each other?

Interstate cooperation is the agreement to create policies that ultimately result in the same goals. For example, countries agreeing to adjust interest rates to calibrate the exchange rate or multiple countries agreeing to enact sanctions against a specific country who is developing nuclear weapons. Primary impediments to reach settlements include: collective action problem (when everyone agrees about the benefits of a common goal, but no one will pay to realize that goal) free rider problem, enforcement transaction costs that harm the exchange or coordination of states disagreements of the form of cooperation that results in coordination problems.

Oil is a key resource because:

It makes up a large share of total global energy consumption

What are institutions? What is the difference between institutions and organizations? What are some examples of institutions in domestic and international politics?

Institutions are humanly devised constraints that structure incentives and interactions while organizations are entities that are actors. Institutions shape how organizations act. Domestic institutions include laws like speeding, how someone is elected president etc. International institutions are sovereignty and the taboo surrounding chemical weapons.

How does oil compare with other natural resources in terms of its share of energy consumption? What sorts of consequences occur when oil prices go up?

Key energy resource because about 33% of total global energy consumption and 37% of total energy consumption in US Significant portion of global trade (15%) When oil prices go up: gas prices go up, can induce global recession, transfers wealth from key oil-importing countries (US, Europe, Japan, China) to oil-exporting countries (Saudi Arabia, Russia, Venezuela)

What is the shale oil revolution? What does it mean for the US to be energy independent and how does the shale oil revolution affect American energy independence? How has the shale oil revolution affected the global price of oil and how have lower oil prices affected geopolitics, especially in the Middle East?

Kinda already stated above, but feel free to add anything- shale fracking allows US oil production to be profitable The US has become one of the largest producers of Oil Allows US to rethink foreign policy in the Middle East Saudi Arabia fought back against US by flooding market and allowing prices to fall so low that it became unprofitable for American Shale production. US production has since reduced and supply has been controlled. Prices have gone up recently. Stimulates technology and create economic independence for US.

Cultural apprehension of mass migration stems in many developed countries from fear of loss of national identity, including factors like:

Language and Religion

Using the module's reading, describe historical waves of democracy and the possible causes of these waves such as demonstration effects, neighborhood effects, conditionality of international organizations, and the influence of hegemons.

Large scale socioeconomic changes normally create waves of democracy promotion through a common cause behind many social movements. Additionally, ideological shifts commonly occur at the same time in multiple places. Demonstration effects occurred in the fall of the Berlin Wall and mass demonstrations in Tunisia in which other countries try to model revolutionary politics after events that have a large following. Neighborhood effects create waves of democracy b/c states tend to emulate the level of democracy in neighboring states. Conditionality of international organizations have incentivized states to become democratic in order to join attractive economic and military orgs like the EU and NATO. International hegemons can build democracies in nations with aid like the Marshall Plan.

What is the political significance of the dollar reserve currency status in the global economy?

Money is a medium of exchange and facilitates economic growth and specialization Dollar is a very stable currency, most transactions (esp. oil) are done in dollars. This supplies money for global economy Helps when flight of safety where buying US treasury bonds causing global liquidity and money supply Ability to rely on foreigners to finance budget deficits helps fund domestic and foreign policies that Americans unwilling to fund through taxes However, seems as if US could potentially be exploited for its global economic leadership

What are the Cold War origins of the North Atlantic Treaty Organization (NATO)? What did Lord Ismay mean when he said the goal of NATO was "to keep the Russians out, the Americans in, and the Germans down"?

NATO was initially created in 1949 in response to the Soviet Union's Warsaw Pact alliance but has extended membership to former soviet nations as well as its mission. Provide military security for western Europe: other functions that made it a robust security collective. That maintained its staying power. Ismay: 3 general benefits of the collective security: keeping Russians out meant that they would provide security against nuclear attack of USSR, NATO binding mechanism for American military power providing a necessary hegemon of the US that guaranteed military security and restrained American military power forcing them to act multilaterally. Keeping peace in Europe with an outside leader of the United States is what was behind "keeping the Germans down." -NATO and protection of Europe from the Soviet threat -NATO as a binding mechanism for American military power -NATO and peace between democratic powers in Europe

Describe the contours of supply and demand on the global oil market? Who are the big players? How has new exploration in North America, such as shale oil, changed things?

OPEC key supplier: Saudi Arabia, Iraq, Iran, Russia, North America Big growth in production capacity in North America (shale boom for US; shale reserves in North Dakota and Texas; create economic independence for US) Supply up: new investments in production capacity stimulated by upward price shocks associated with 9/11 and Iraq War

What is OPEC? How much oil does it control? How does it operate to manage oil prices? What is the special role of Saudi Arabia? What has OPEC done in response to the US shale oil revolution and how has the "price war" initiated by Saudi Arabia and OPEC affected global oil prices and US oil production?

Organization of Petroleum Exporting Countries (primary oil producers in the world) Members: Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, UAE, Venezuela Holds about 80% of known proven global reserves mostly in Venezuela, S. Arabia, Iran, Iraq, and Kuwait Operates like a cartel: limit global supply by setting production quotas to push global prices up Saudi Arabia: swing producer so has reserve capacity and changes production levels to stabilize global markets Recent cooperation within OPEC impacted by Iranian nuclear accord -No production sharing agreement until Iran's production reaches pre-sanction levels -prices down so good for consumers -daily penalties for Iran

Which of the following individuals have been charged or have plead guilty to crimes as part of the Mueller investigation?

Paul Manafort - former Trump Campaign chairman

2. What is power transition theory? What causes shifts in the distribution of power among great powers and how can they alter the larger international political order and heighten the risks of war?

Peace and stability in great power relations form military, political, and economic domination by one state Hegemon sets and enforces rules of system Instability and war from power transitions (shift in distribution of power that reduces or eliminates hegemon's supremacy) less capable of enforcing international order rising challenges tries to alter SQ order may want to start a preventive war to stop another great power from rising and taking their place Link to commitment problem Many great powers don't want to give up their place as a great power not only because it is a reduction of power, but also because it is hard to trust that the new rising great power won't disrupt the values and rules that the past great power has put in place (may disrupt international system)

1. What is polarity? How does the distribution of power between great powers influence their relations? What is the difference between unipolar, bipolar, and multipolar systems and how does each affect relations between great powers?

Polarity counts the number of great powers in an international system and represents the distribution among great powers in the international system. Helps set the threat that each power poses to the others, influences coalitional dynamics as well as the risks associated with coalitional realignment. Unipolar: one hegemon, like the United States. The absence of other powers capable of challenging the military and economic dominance of a single great power. Threatening because they must have a balance of power in which they don't exploit weaker states and force them into regime change, etc. EX: US after Cold War in 1991- present. Because middle states have so much less economic prosperity and military power than the unipolar hegemon, it is unlikely that they would ever challenge the unipolar hegemon. It is costly to hold up position as a sole hegemon, so it may not be super popular domestically, because of all the money being put in to maintain international power. Bipolar: two strong states like soviet union and the united states during the cold war. This bipolarity reduces the risk of abandonment and leaves the state to look domestically in order to be able to sustain its positioning. For example, the soviet union no longer could domestically sustain the long term arms race with the united states and withdrew from the competition. Alliances aren't as crucial, because if a middle state withdraws from an alliance, it doesn't really affect the capabilities of either of the great powers. Multipolar: alliances like in ww2. The alliances are more fluid and politically significant than other systems. Higher risk of great power war, more commitment problems, neutrality is destabilizing to the great powers. Alliances have more of an effect here, because if two of the great powers decide to align against the other great power, it may make the other great power very mad and make risk for war.

What types of international behavior does power transition theory expect from global powers that are ascendant versus global powers that are in decline? What is the commitment problem in this situation and how does it help to explain the incentives for declining powers to launch a preventive war against rising powers?

Powers that are in decline will unleash a preventive war and want to maintain the current status quo political order. The ascending power does not have the legitimacy to build partnerships or alliances. / The commitment problem is amplified because states are uncertain if they should commit to the dominant state or if they should err on the side of the rising power to secure safety in a future political order. This commitment problem to a rising state over uncertainty incentivizes a current but declining global leader to seek a preventative war because more states will back them.

What are the unique characteristics of the demand for oil? What does it mean that oil has "inelastic" demand and few substitute goods? How does this affect demand for oil?

Price determined by the intersection of supply and demand demand: -relatively inelastic in the short run: quantity demanded not responsive to shifts in price -few substitute goods at similar price -spike in oil prices often caused by an outward shift in demand curve

What is an exchange rate? How do shifts in exchange rates alter patterns of imports and exports? How can exchange rate changes influence trade policy?

Reflect differences in value of respective currencies; price of one currency in terms of another Shape price of conducting international trade -When dollar appreciates, imports go up because the foreign products are cheaper/bought by more valuable $ and more units can be bought of a foreign currency -exports also go down because priced in $ and more expensive to foreign consumers -opposite with depreciating: help exports and hurts imports (buys fewer units of foreign currency)

According to the reading by , why should the United States consider halting its physical protection for oil sales from the Middle East?

Shift to one-war requirement because no other region poses a significant threat to dislodge the Persian Gulf from 2-year construct; so US can do this if end commitment Would save roughly $75 billion a year or 15% of defense budget and this can be done by moving toward smaller force, down by 2 aircraft carrier strike groups, 2 army divisions, and a few hundred air force fighter jets and bombers The US has fought expensive wars that were either directly or indirectly related to protecting oil interests Would yield large savings in both dollars and lives The US could pursue a wide range of nonmilitary options for increasing supply and reducing demand that would enhance ability to weather a major disruption Cutoff no longer poses a serious threat to US and well cushioned against all but the worst oil disruptions and has options for further reducing its vulnerability on economic

What are the domestic distributional consequences of globalization? Which groups win and lose from globalization inside the United States?

Some see income gains and some income losses International trade creates jobs in sectors that rely disproportionately on resources that US possesses in abundance -drives down costs of these factors and makes goods that rely on them as inputs cheaper -considers factor endowments like scarcity and abundance in US relative to ratio in other countries Jobs lost in sectors that rely disproportionately on resources that scarce in US Political implications: activates political domestic conflict because some groups win and some lose; this explains prevalence of barriers to trade that constrict national income

3. What are some critiques of the democratic peace theory?

States that transition from autocracies to democracies have increasing conflict. Additionally, people point to alternative explanations for the peace after WWII. Namely, the common enemy of the Soviet Union meant that democracies were on the same side in terms of foreign policy decisions. Some believe great power settlements, not democracy, stabilized peace post WWII.

Democracy can help promote peace among democratic states by solving the commitment problem. A. True B. False

TRUE

During the twentieth century, the population of democratic regimes in the international system has been shocked upward in waves facilitated by diffusion.

TRUE

Elections in democracies can help promote peace among democratic states by raising the domestic political cost of war.

TRUE

Preferential trade agreements are generally tolerated, despite violating non-discriminatory principles, because they are seen as boosting economic activity.

TRUE

If trade makes states wealthier, why is there political resistance to globalization?

Tendency of globalization to shift distribution of income within economy Some groups see income gains like high tech and college graduates while some see income losses like manufacturing sector

Why does the US have so much influence within the IMF?

The US contributes the most to the IMF, which decides IMF influence

Describe the tradeoffs associated with participation in international organizations and national sovereignty.

The authority given to international organizations runs the risk of limiting domestic sov of states such as how the WTO decides what forms of policies are justified or unjustified. The tradeoff between cooperation among states and sovereignty is the central tension between the two. -delegation of authority to international orgs can limit domestic authority. Ex: Bush raised import duties on steel. Countries challenged tariffs with trade dispute at WTO. Judicial panel ruled against US and Bush had to take away tariffs. -international org. helped change domestic politics and laws in the US -institutions and organizations can help US interests (getting rid of trade barriers) and help alliance relationships and economies. However, pursuit of these goals can alter domestic policies that emerge through democratic process (like how the WTO made US change trade policies). -part of appeal for Trump's "America first"; want to protect American sovereignty.

According to this module's reading, what is the Mundell-Fleming Trilemma? How does it create tradeoffs in a country's exchange rate policies?

The tension between monetary policy autonomy, exchange rate stability, and capital mobility States that although governments often want monetary policy autonomy, exchange rate stability, and capital mobility, they can't simultaneously possess all 3 Must choose 2 based on relative tradeoffs involved Sometimes give up monetary policy autonomy in smaller countries because manipulating interest rates would in turn put pressure on the value of their currency, offsetting the peg (fix currency to that of larger country) Usually comes to choice for governments between fixed or floating exchange rate; often dictated by tradeoff in exchange rate stability versus preservation of monetary policy autonomy and political implications of this are also determined by understanding who wins and loses from various exchange rate arrangements

What is the tragedy of the commons? Why is it rational for individuals to overuse public goods? How does this phenomenon help to explain the difficulty of managing the sustainable use of commonly held public property? Know some examples.

Tragedy of commons - a situation in a shared-resource system where individual users acting independently according to their own self-interest behave contrary to the common good of all users by depleting or spoiling that resource through their collective action. Emerges with public property or resources for which it is difficult to restrict their use Divergence between private benefits and social costs: individually rational for people states to consume, but diffused costs to society insufficient to prevent overuse Resource gets depleted Examples: oil fields, common grazing lands, overpopulation, fisheries, atmosphere Another example: factory upstream dumps pollutants in river which is key water source for city so people getting sick but also depend of factory for job and if change factory becomes less profitable and out of business and if city pays it can subsidize production; hard because absence of property rights over river so creates externalities

What is the TPP? Why did President Trump formally withdraw the United States from the TPP in 2017? Why did he consider rejoining the TPP in 2018?

Trans-pacific partnership: agreement reached among 12 countries in October 2015 to link economies -reduce trade barriers between them -influence labor and environmental regulations Trump withdraws US based on prospective job losses Economic size of signatories significant Trade liberalization-cut barriers and increase flow Political benefits: preempt Chinese economic influence and push labor and environmental standards up

According to the Mueller report, President Trump avoided crossing the line of criminal obstruction of justice in part because his aides refused to follow his orders. For example, White House counsel, Don McGhan, refused to follow Trump's directive to fire Robert Mueller.

True

According to the logic of the democratic peace, we are more likely to see a war between the United States and Syria than we are to see a war between the United States and the United Kingdom.

True

An externality is a benefit or cost associated with an activity that accrues to some third party who is not a direct participant in the activity.

True

An increase in the value of the dollar relative to the Japanese yen should increase American imports from Japan.

True

Central banks help set monetary policy by influencing domestic interest rates.

True

Even though international trade increases national income at an aggregate level, some groups within an economy will see their real incomes decline from globalization.

True

Global oil consumption is inelastic in relation to price; that is, increases in the price of oil do little to affect global demand.

True

Hegemonic stability holds that the global concentration of economic and political power in one state tends to promote open international trade.

True

Higher national trade to GDP ratios are one potential indicator of globalization

True

International migration benefits both high skill and low skill labor globally.

True

Israel uses a system of proportional representation to elect members of its national legislature, the Knesset. This type of electoral system favors smaller parties and thus tends to produce coalition governments in which the largest parties must find partners among smaller parties to form a government.

True

On average, democratic states tend to win the wars they enter because reelection incentives (namely, the fear of getting voted out of office for policy failures) push democratic leaders to be cautious when going to war. Consequently, democratic leaders generally fight only when they have a high probability of victory.

True

One of the reasons that Mueller and Barr did not decide to bring charges of obstruction of justice against President Trump is that they did not find evidence of an underlying crime of conspiracy. Because there was no underlying crime - no conspiracy - then there was nothing to cover up.

True

President Trump formally withdrew the United States from the Trans Pacific Partnership in 2017.

True

Prime Minister Benjamin Netanyahu has promised, if re-elected, he would extend Israeli sovereignty over settlements in the West Bank. This could make it much harder for Israeli governments in the future to surrender these territories in any negotiated settlement to end the settlement with the Palestinians.

True

Remittances are monetary transfers from migrants to people, often family, in their home countries

True

Saudi Arabia plays the role of swing producer within OPEC, using its large oil reserves to influence production levels set by the cartel.

True

Some research suggests that securing U.N. approval for a military action raises public support within the United States for that action.

True

The International Monetary Fund (IMF) was founded to stabilize international currency markets and to prevent currency wars.

True

The Mueller team determined that contacts between Trump campaign officials and Russians did not meet the legal criteria for conspiracy because Trump election officials did not direct, request, or work with Russian entities to commit crimes.

True

The Paris Climate Accord operates through a series of monitoring arrangements that strengthen the ability of domestic groups to pressure their national governments to implement policies that reduce carbon emissions.

True

The political challenges associated with limiting carbon dioxide emissions can be illustrated with the logic of the collective action problem.

True

While President Obama was sharply critical of the Netanyahu's government policy on settlements in the West Bank, President Trump has refrained from criticizing Israel on this issue.

True

Describe some important steps in the emerging trade war between China and the United States

US new tariffs on steel and aluminum (China not exempted) China responds with tariffs on $3 billion US imports (fruits, nuts, wine, and pork) Trump threatens to impose 25% tariffs on up to 1300 Chinese products (machinery, mechanical appliances, electrical equipment) -Potentially cut $50 billion of Chinese exports China threatens to impose 25% tariffs on US exports of transportation equipment (planes and cars) and agricultural (soybeans) -Potentially cut $50 billion of US exports Tuesday (4/17): China new fees (tariffs) or sorghum exports from US -About $1 billion; production concentrated in Kansas and Texas China targeting sectors important to Trump's political base like blue collar manufacturing and agriculture in red states Imposing economic pain on them so pressure Trump to change his policies

Which international organization was discussed as possessing effective enforcement capacity?

WTO

Which of the following is an international organization?

WTO

How can global capital markets discipline or influence the economic policy of governments?

When foreign capital holders lose confidence in government's monetary policy causes them to sell assets denominated in that currency -currency depreciates -government can reassure investors by raising taxes or cutting government spending, offering higher returns like pushing interest rates up, but these push the domestic economy into recession. International capital markets can sharply constrain country's monetary policy limiting discretion of elected officials and forcing them to push their economy into recession to reassure creditors

President Trump has enacted which of the following changes in U.S. policy toward Israel:

a) moved us embassy in Israel from Tel Aviv to Jerusalem b) offered official U.S recognition for Israel's 1967 seizure of the Golam Heights bodering Syria c) BOTH

The following countries are members of OPEC:

a)Saudi Arabia b) Venezuela c) Russia D) A AND B