Chapter 1 Flashcards
What is globalization in the economic sphere called?
International economic integration
When has international economic integration occurred rapidly?
Since approximately 1950, especially since the early 1970s.
When was a major wave of globalization?
A major wave of globalization occurred between approximately 1870 and 1913.
What are the measures of international integration?
Look at world trade, international capital flows, international migration, and convergence of prices in different markets.
How has world trade changed since the end of World War II?
World trade has grown much faster than world production.
What was the world exports percentage of world GDP in 1950?
About 5.5 percent.
What was the world exports percentage of world GDP in 2013?
About 30 percent.
How is the importance of world trade measured?
With the trade-to-GDP ratio, which is exports plus imports divided by GDP.
What does the trade-to-GDP ratio formula look like?
Trade-to-GDP ratio = (exports + imports) ÷ GDP
What was the trend of the trade-to-GDP ratio between 1913 and 1950?
The trade-to-GDP ratio fell.
What was the percentage of immigrants in the U.S. population in 1890?
About 14.5 percent.
What was the percentage of immigrants in the U.S. population in 2010?
12.9 percent.
What are the types of capital flows?
Paper assets such as stocks and bonds, and capital flows used to purchase real assets or set up businesses and factories.
What is foreign direct investment (FDI)?
The purchase of real assets.
What are the characteristics of capital flows today?
They are much larger than during the earlier wave of globalization, include many more types of financial instruments, are frequently devoted to protecting against currency fluctuations, and have lower transaction costs than previous eras.
What do economists believe about trade and economic growth?
Economists favor free trade because it enables countries to grow faster and improves the living standards of their people.
