EQ2 superpowers Flashcards
features of free market capitalist economy
- people own businesses and employ workers to make profit
- free trade across borders promoted
- dominated by private enterprise instead of gov owned companies
- promote wealth creation and accumulation by individuals
what is free trade
international trade without restrictions such as import/ export taxes and quotas restricting the volume of trade
features of centrally planned economy
- government ownership of property and land
- state owned businesses, wages determined centrally
- profits taken by government for public services
- prices controlled by government
examples of free market capitalist economies
USA, Canada, Japan, Western Europe
examples of centrally planned economies
USSR, China, Eastern Europe, Cuba
when and why were IGOs created
end of WW2
created by EU and USA to promote free market capitalism
what are the IMFs goals?
- founded 1945
- promotes global stability using Structural Adjustment Plans
- aids economies in opening up to world trade and investment
- comes to the aid of countries in economic difficulty
what is the World Economic Forum (WEF)
- founded1971
- swiss non-profit organisation
- acts as a forum for discussion between businesses, politicians and IGOs
- pro-free trade and pro-TNC
what is the World Bank?
- founded 1944
- lends money to developing and emerging countries to promote economic development
- done using western capitalist model
- money originates from developed countries
what is the World Trade Organisation (WTO)
- founded 1947
- works to remove barriers to international trade
- negotiated series of global free trade agreements that have gradually removed trade taxes and quotas
what % voting power do the US have
16.5%
why can US veto IMF decisions
85% needed to pass a motion
US vote against means 84% even if everyone else votes yes
what are the two types of TNC- give examples
Public TNCs- owned by shareholders
e.g. apple, tesco, shell, zara
State led TNCS- owned by the government
e,g, bank of China, EDF, petronas
2020 Top 3 TNCs and revenue
USA- Walmart - $559Bn
USA- Amazon - $386Bn
China- State Grid - $383Bn
Where are State led TNCs more common
centrally planned economies
China, Russia
what is Chinas largest state owned TNC?
Industrial and Commercial Bank of China
top 4 are all bank
advantage of having large state-owned TNCs
long term development plans:
road, rail, ports, renewable energy, neo-colonial investments in other continents
disadvantage of having large state-owned TNCs
- corrupt
- dicourage private investment and innovation
- vulnerable to accumulating large levels of debt as a result of inefficient operations
how many people does Walmart employ worldwide
2.2 million
what 2 countries total GDP is equal to Amazons annual revenue
Argentina and Ireland
what % of the world’s 2000 biggest companies in 2020 were from EU, USA and Japan?
60%
25% USA
how do TNCs maintain power and generate wealth?
- Foreign direct investment control
- Funding new technology
- control over patents
- footloose so influence countries boom and bust cycles
what % of patent royalties are paid to EU, US, and Japan?
90%
what is culture
system of shared beliefs, values and traditions, including behaviour, dress, art, language, food, relationships, religion and political view
characteristics of western global culture?
- individual freedom and rights (gender, religion)
- western capitalist model, wealth accumulation = successful
- importance of leisure
- importance of latest tech which can solve problems
- living in a small family unit
who and when had the global police idea? what is it?
1942- Roosevelt
‘USA, UK, Russia and China should police the world’
