Revision_inequalities_et_al Flashcards
Think of one obstacle to the free trade between countries:
Different law systems in countries which may lead to forbidden trade russia and EU
- How has the 2008 global financial crisis slowed the globalization process? Explain:
Institutions such as lehman brothers investment bank couldnt lend money to businesses from emerging countries
Explain, how did these two events effect globalization:
a) The Opening of China, 1970’s;
b) The Fall of The Communist Bloc, 1989-1991
a) The Opening of China, 1970’s -the opening of china allowed trade between china and other countries from all over the world, which has helped globalization as it caused a lot of businesses to emerge with the help of selling exported goods from china, which were sold cheaper.
b) The Fall of The Communist Bloc, 1989-1991 – this helped globalization as it allowed people in eastern europe to have international trade with other countries, therefore they were able to import goods from abroad and export goods, this resulted in a lot of businesses being created in eastern europe.
Five Disadvantages of Globalisation:
1.inequality/relative poverty- means that some countries such african are getting richer in usd every year but in comparison to uk or usa they are getting poorer, so the gap is increasing
**2.threats to the global commons **
-deforestation
-shortage of water
-biodiversity
3.macroeconomic fragtility
When the centre fx usa rises interest rates the emerging countries like poland have to offer more because nobody will give poland money
4.Trade imbalances- sometimes free trade leads to imbalances in your domestic market (cheap grains from ukraine this leads to protectionism)
5.higher structural unemployment- when the workers are underskilled in developed countries, because the companies move their production to cheaper labor countries
6.standardization- global brands impose standards -> so all culture ->becomes the same -> no diversity
- Which flow is more free flowing – flow of labour or flow of capital? Why?
The flow of capital is more free flowing in comparison with the flow of labourv - that is because the flow of capital is very easy and simple: when you have capital in the form of machinery or investment , you can just move it to another economy efficiently, whereas when it comes to labor, it’s harder because it would mean that people need to leave their homeland behind and start working in another place.
- What were the initial goals of IMF and the World Bank? [two goals]
stabilizing trade
and
to avoid financial crisis
- How did the goals of the IMF and the World Bank evolve? [two new goals
first, specializing in providing loans to poor countries but those loans come with conditions, for example Privatize the banking sector, which would mean that poor countries would loose the control over their banking system
Second, help countries that** experienced a natural disaster **[grants]
Why could more globalization lead to stronger financial crises [two causes]?
->general macroeconomic Fragility
->more independence between companies [domino effect]
->stronger price shocks [for example oil]
->vulnerability to interest rate change or stronger USD
To whom does the IMF act as a “lender of last resort”?
To the nations or to the central banks who have problems
Give two arguments against IMF that critics use:
1.it takes too much control over a country that is borrowing capital
2. It strengthens the developed countries in favor of developing and emerging
3. It is not directly a democratic institution
4. The influnce of G8 countries on IMF is still very strong because of quotas [the countries that pay more have more to say]
Prove that American influence in the IMF is still big despite the rise of BRICS countries
->They have the most wealth + they have the veto, which means that they are the “big players” ;
-> the BRICS countries are trying to use the population argument
Is there a relationship between GNP per capita of a country and life expectancy in this country?
**No relationship **as there are rich countries who have a high GNP but a low life expectancy
Does intra-country disparity affect life expectancy? In what way?
** Yes**, because the rich parts of the country have much higher life expectancy as the poorer cannot afford access to healthcare or healthier lifestyles
In which group of countries is GNP per capita a significant factor in determining quality of life?
Only in poorer countries
In which European country can you “trust no one” in? [‘10%]
Portugal!
