Lecture 4 - Globalization Flashcards
What is the difference between a fixed and growth mindset?
- Fixed –> talent is innate and can’t be developed
- Growth –> talent can be developed through hard work, good strategies, feedback, etc. (failure as an opportunity to grow)
What are Weber’s 2 primary types of rationality/motivation?
- Instrumental/Means-End rationality –> most efficient/practical means to reach the desired goal (calculated, rational, considering conditions + other that affect the ability to reach the goal)
- Value rationality –> decisions based on ethical values despite a low likelihood of success
What is rationalization?
Society moving towards instrumental rationality (away from religious motivations for actions)
2 key components:
- Efficiency (Max. output, min. input)
- Predictability (Outcomes are predictable)
What is ethnocentrism?
The attitude that one’s own group/ethnicity/nationality is superior to others
What is Karl Marx’s concept of alienation?
- 1800s –> saw Industrial Revolution of England (fewer farmers, more city/factory jobs)
- Workers experienced alienation (estrangement from human’s essential nature)
- Industrialization took away a person’s desire to use creative potential (AKA work wasn’t allowing people to think, be creative, be proud of the fruits of their labour)
What are special economic zones?
AKA foreign trade zones/free trade zones, designated areas in a country that are declared symbolically “outside” the country (in terms of laws, customs, duties, taxes, regulations, other policies not applying there)
- Placing sweatshops in these zones makes business/manufacturing/production easier (quick turnarounds, quick importing/exporting, cheaper)
- Canada offers the option to create free trade zones anywhere in the country (to attract corporate investment, create jobs, benefit the economy)
- Wealthy countries don’t pay tariffs, low-income countries face the negatives (no freedoms w/ labour laws, no rights to form unions, environment destruction, unpaid overtime, lack of safety standards, etc.)
What are the 2 problems with globalization?
- Well-documented + publicized violations of human rights + international labour standards (and domestic ones)
- Growing power + wealth of MNCs (Corporations seeking the best for themselves, not society as a whole)
What is power, as defined by Weber?
The ability to achieve one’s goals when others are trying to prevent them from being realized
What is globalization?
Increased daily interaction that the average actor (people, gov’t, business) has w/ cultures/products/people from nations other than their own
How did globalization occur?
- Through migration, global trade, war/colonization
- Bretton Woods, post-WWII –> international trade/interconnected economies was thought to decrease the chance of war (creation of International Monetary Fund –> ensures monetary cooperation, financial stability, facilitates international trade, etc.)
- Political initiatives increased globalization (UN, IMF), but also advancements in tech (communication + transportation)
- B/w Bretton Woods and Uruguay Rounds, MNCs became common
- By Uruguay Rounds, countries had an interest in protecting their MNCs
What are the 3 aspects of globalization that the KOF index measures?
- Economic globalization –> trades in goods/services, diversity of trade partnerships (# of countries), foreign direct investment, international debt/reserves/income payments
- Social globalization –> international phone calls/money transfers/tourism/students, immigration, emigration, international patent, Internet bandwidth on international content, international trademarks
(Ex. McDonalds, Ikea) - Political globalization –> embassies, UN peacekeeping missions, international NGOs
What are multi-national corporations?
Corporations that have their home base in one country, branches/affiliates/operations elsewhere
What are the 3 reasons for our reliance on the economy?
- Jobs (Things we need for a good life)
- Pensions (Reliance on the stock market for pensions)
- Maintaining home value (2008 crash saw the amount owed on the property being larger than value, so people had to declare bankruptcy)
What is free-market economics?
Unregulated system of economic exchange, in which taxes/quality controls/quotas/tariffs/other forms of centralized economic interventions by gov’t don’t exist/are minimal
- Supply and demand is the only force that regulates the market (not gov’t)*
- More demand, less supply = more expensive (and vice versa)
- All countries exist somewhere between free-market economics and socialism/communism
When does the gov’t intervene in markets?
- When it comes to essential rights + avoiding externalities + when supply/demand don’t work well
- Taxes (progressive tax rates + proportional/flat tax rates [everyone pays the same tax])
- Taxes to help redistribute wealth + provide essential services
