Unit 5 Flashcards
What is economic globalization?
The economic networks that are growing more interconnected, a worldwide market. Talks about the economic actors that are unconstrained by political borders.
What does economic globalization lead to?
- Reduction in state control over economies
- A deepened cross-national connections among workers, goods, and capital
- Spread of ideas, technology, and information across international borders
- Spread of jobs across these borders
International economic organizations
IMF
WTO
EU
NAFTA
The world bank
International monetary fund (IMF)
Works to foster global monetary cooperation and the stability of the international monetary system.
Countries: UK, Russia, China, Mexico, Nigeria, Iran.
The world bank
Provides financial and technical assistance developing countries to reduce poverty and support economic development.
Countries: UK, Russia, China, Mexico, Nigeria, Iran.
The world trade organization (WTO)
Helps develop rules of trade between nations with the goal of ensuring that trade flows smoothly and safely.
Countries: UK, Russia, China, Mexico, Nigeria
Why do countries join IEOs?
- INcrease access to global trade
- To be accepted into the international community
- To gain easier access to markets
- To grow their economy / GDP per capita
How does membership in an IEO influence economic policy?
- Promotes economic globalization policies
- Requires policy changes in order to join
- Requires policy changes in order to recieve financial assistance
Multinational coporations (MNCs)
A coporation that has facilities and assets in at least one country other than its home country.
What challenges do MNCs pose to countries?
- Conflict over labor and pay in different countries
- Challenges with environmental damage
- Conflict over land rights
- Conflict over taxation
Neoliberalism
Seeks to transfer the control of economic factors from the public sector to the private sector by reducing gov intervention in the economy and promoting free-market economy.
The challenges of neoliberalism
- Increased demand on gov by civil society groups
- Protests
- Arrests of portests
- Impositions of social media restrictions
Policies regarding private ownership of industry and capital in AP6
China: SEZs (Special economic zones) along the coast
Mexico: Privatization and increased competition in Mexico’s oil industry (PEMEX)
Nigeria: State-owned Nigerian National Petroleum coporation (NNPC)
Russia: Putin’s renationalization of oil-natural gas industries and imposition of foreign investment limitations.
Privatization
Gov-owned industry transferred to privately-owned
Nationalization
Privately-owned industry —> gov-owned
How can globalization challenge sovereignty?
- Foreign direct investment and multinational corporations can pose a challenge to a government’s foundational economic political principles.
Ex: MNCs have created corruotio and gov’s dependency on oil. - Cultural influences that accompany investmenr and trade can provoke domestic backlash.
Ex: China economic reforms led to judicial reform. - Increased economic development can cause environmenta; degration and accompanying health issues.
Ex: China emphasis on economic growth over environmental protection - Foreign governments can bring political and economic pressure on countries whose actions offend them
Ex: Iran growth slowed after sanctions intended to stop Iran’s uranium enrichment program.
Differences between UK and China industries
UK: Most natural resources are controlled by private industries (China state-owned)
UK: Private industries pay taxes to gov to fund the gov
China: State-owned industry profit help fund
Similarities between UK and China industries
Natural resources are important to the national economy
Governmental response to global market forces
- Implement domestic reform in response to internal demands\
Ex: China economic reforms and anti-corruption efforts
Nigeria: Attempt to reduce corruption in oil industry - Control domestic policy debates
Ex; UK leaving EU
Iran response to protests
Extend regional influence to deflect criticism and improve economic conditions
Ex; Russia efforts to maintain trade relationships and influence with former soviet counrties
Mexico: Participation in NAFTA
Economic liberalization
Reduces its role in the conomy and embraces free markey mechanisms such as eliminating subsidies and tariffs, privatizing gov-owned industries, and opening the economy to foreign direst investment.
Neoliberal economic policies
Removal of barriers and restrictions on what internal and external economic actos can do.
Consequences of neoliberal economic policies
- Reduction in inflation
- Increase in national income
- Growing inequality in wealth distribution
- political corruption
- environmental pollution
- urban sprawl
- uneven economic development
- poor infrastructure
- regional migration
What is an International Organization?
Organization joined by member states working toward a common interest.
- Have own rules and guidelines that member states have to follow.
Examples of International Organizations
- International Monetary Fund (IMF)
- United Nations (UN)
- World Bank
Whata are the positives for member states for belonging to an international organization?
- More opportunties for global trade
- More opportunities to builde relationships with other countries
- Can help provide security and stability
What are the negatives for member states for belonging in an international organization?
- International organizations that promote free trade can hurt domestic businesses and industries
- May not treat member states as equals
What is a Supernational Organization?
An organization which member staes give the governing organization sovereignty over policies. Policies that are often related to trade.
Examples of Supernational Organizations
- Economic Community of West African States (ECOWAS)
- European Union (EU)
- World Trade Organization (WTO)
Positives of being a member of a supernational organization
- Encourage cooperation between member states
- Can prevent future conflicts between member states
- More influence in world affairs as part of supernational orgamization than as individual state
Negatives of being a member of a supernational organization
- Give up sovereignty
- Pressure on leaders and political parties to meet the demands of supernational organizations
- Policies of supernational organizations do not always align with local wants and needs
What is the difference between international and supernational organizations?
- An IO has member states working together toward common goals and interest. Decisions are made with all member states involved.
- A SO has member states give up power and allow the organization to make decisions on behalf of member states
- Much more sovereignty is sacrificed when belonging to a SO.
What does the IMF do?
- Most countries of the world belong to the IMF including ALL 6 of AP countries
- Manages exchange rates
- Provides loans to countries in need of financial assistance
Major goals of the IMF
- Ensure stability of the international monetary and financial system
- Resolve global finanicla crisis
- Promote global trade and economic growth
- Reduce poverty
What happens when countries recieve loans from the IMF?
- Privatization of state-owned companies to promote capitalism and reduction of corruption from government controlled industries
- Reduced or eliminate tariffs to stimulate free trade
- Reduce gov subsidies of domestic industries to encourage free trade and capitalism as well as reducing favortism of them
What does the World Bank do?
- ALL 6 AP countries
- Provides low interest loans to countries in financial need
- Provides grants to developing countries for projects
- Provide financial advice to countries that ask for it
Major goals of World Bank
- Provide financial support to developing countries
- Promote shared prosperity
- End extreme poverty
What does the WTO do?
- ALL 5 AP countries except IRAN
- Regulate international trade
- Oversees trade agreements
- Mediates trade disputes
- Lower or eliminate tariffs
Major goals of WTO
- Increase international trade between member states
- Reduce barriers to international trade
- Promote fairness and transparency in trade
What is the impact of import substitution industrialization policies?
- Limit imports to prop up domestic goods and products
- Encourage production of local industrialized products
- Encourage purchase of local products by citizens because price is cheaper than foreign products
- Since states are propping these businesses and industries up, this takes a lot of state revenue away from other parts of government
- Local business and industry can perform well without foreign compeitition but typically will not be innovative and produce substandard production
Goals of import substitution industrialization policies
- Support domestic businesses and reduce foreign dependency
What countries have used import substitution industrialization policies?
Mexico, Nigeria, and UK.
What was the impact of joining supernational organizations on countries that have had ISIs?
Reduced or eliminated ISIs due to the regulations.
EU for UK
ECOWAS for Nigeria
NAFTA for Mexico
What does the ECOWAS do?
- Break down barriers to trade
- Economic and peacekeeping focus
Goals of ECOWAS
- Building better connections between member states
- Potential to be an EU like SO for West Africa.
What does the EU do?
- Reudce economic barriers and increase inetgration between member states
- Promoted greater European political and economic inetgration
The UK on EU
- Not an original member of EU and has a history of independence from the EU members on the continent
- Did not adopt the Euro
- Frustrations by citizens toward the EU led to Brexit in 2016
British criticisms of the EU (Euroskepticism)
- Undemocratic
- Bloated bureaucracy
- Forcing continet beliefs upon British citizens
- Elitist and not caring about the average British citizen
- Did not like common currency
- Rapid expansion of EU that included many countries of Eastern Europe
- EU enabled more immigration to the UK.
UKIP and Euroskepticism
- Anti-EU and advocated for the UK to leave the EU
- Seen as a fringe party and clashed with Conservative and Labour
- Winning seats allowed UKIP to lobby for a referendum vote on UK leaving EU.
Brexit
- Referedum on UK leaving EU.
- PM David Cameron resigned as a result
- Successor PM Theresa May also resigned after failure to execute a leave plan
- Created economic chaos in UK
Adaption of social policies in Iran (Women and government)
- Major gains in womens rights before Iran rev (been allowed to vote/same rates as men) and carried over
- New restrictions placed on women after rev
- Pushes for greater women’s rights promoted through islamic feminism
- Since rev women run for Majles
- Amount of women increasing in gov
- Women are vetted by GC and dont make it to ballot
- Can serve in cabinet
Adaption of social policies in Iran (Education)
- Education opportunities for women pre-rev
- More opportunity than neighbor countries
- Women can attend universities
- More women enrolled in universities than men
- Limitations placed on women in universities
- Prevent women from being admitted to certain degree programs.
Adaption of social policies in Iran (Sports and athletics)
- After rev theocracy restrict athletic opportunties for women as participants and spectators
- Watching segregated by gender
Adaption of social policies in Nigeria (Education)
- Unequal access for women in North compared to the South
- Stronger cultural emphasis on female education in southern states
- More gov funded schools below middle belt
- education causes less birth rates
- Traditional islamic culture of north has not priortized education for women
What are social welfare policies?
-Gov policies that provide programs or services designed to improve the lives of citizens
What does social welfare policies do>
- focused on helping citizens who are not a or below the poverty kine
- Proviude an economic and societyal safety net for the public
- taxes pay for these programs, greater tax
- can help promote regime legitimacy to show gov cares for citizens
Examples of social welfare
- direct relief via cash payments
- public schools
- public health care
- public housing
- food districbution
- support for elderly
- persion plans
Social welfare policies in the UK
- National health services
- Public housing
- Education
- Programs for elderly
NHS in UK
- Key part of social welfare system
- great civic pride in the NHS
- debate point ebvrween two major parties
Public housing in UK
- increased urbanization has created more of a demand for public housing assistance
Education in Uk
- more emphasiss on public schools in changing econ
- citizens used to not need much edu
Programs for elderly
- pension programs for the elderlt and retirees bc of agining population
- politicians who threaten to reduce thse plans major loss of votes bc of large elder popu
Social welfare policies in Iran
- poorly run and inefficient
- no tax massive oil revenues allow to gov to operate its budget
- Fluctuating oil market create inconsistent gov revenue and prevent gov from providing high lvl services
Bonyads in Iran
- Charitable orgs often designed to help less fortunate
- Recieve oil money to carry out their services often sponsored by powerful fams in Iran
- Lack of oversight has led to many bonyad being corrupt and not he;ping citizens
Austerity
Governments making budget cuts to programs or raising taxes to balance its budget and decrease debt
Positives of industrialization
- economic diversity
- technological advancement
- job ceration
- welath creation
- leads to infrastructure improvemenrs
Negatives of industrialization
- massive pollution
- dependece of fossil fuels
- low paying jobs
- dangerous working condistions
- gov corruption
Why gov ignored environ damage done by industrialization
- priotiized profirs and economic success over health and envi safety
- autho states prioritizing benefits to leaders over harm to citizens
- corruption of major industrial businesses bribong and lobbying gov for rules that allow for major pollution
- ignotance of long term effects
China envi issues
air pollution heavy use of coal
smog in cities
river pollution
soil contamination
Iran envi issues
air pollution
smog in tehran
oil pollution in persian gulf
Mexico envi issues
air pollution, smog, deforestation
Nigeria envi issues
air pollution, oil spills, deforestation, lack of clean water
Russia envi issues
air pollution, water pollution, nuclear waste
UK envi issues
air pollution, soil contam, pollution to water bodies
Gov solutions to envi and poli problems
Moving factories
Promoting green energy and technological via gov subsidies
Increase the dev of infrastucture
increase the envi regulatuons
Air pollution and response
Factory emissions amjor contributors to air pollution
- promotion of use of hybrid and battery powered automobiles
- greater emphasis on dev public transportation that does not relyt on gas
Trade liberalization
when gov reduces rules and regulations on foreign trade. making trade free from barriers like tariffswh
what are the effects of trade liberalization
- increases global trade
- attracts foreign business
- increases foreign direct investment
- influences foreign exhcange rates
- population omvements in country for jobs
- can lead to improved technology
-can lead to envi damage - can lead to poor conditions for workers
- less gov psending
consequences of increasing tariffs
hurt foreign trade
benefits deonestic business
proetcted existing jobs
can offer consumers inferior products
deterent to FDI
consequences of decreaing tariffs
helps foreign trade
can hurt domestic business competing w foreign competitots
lead to creation of new jobs
can lower prices for goods
leads to greater FDI
What can cause demographic change
- growing or decreasing populations
-changing land use(urbanization, agrarian to industrial) - changing values
- changing opportunities
Causes and effects of demographic change in China
- econ change
agarian to industrial enhanced urbanization of China - urban opportunities
cause for migration
SEZs creation
HuKou system in China
domestic passport resticts hwere citizsn ca n live
- control population distribution
- demand to move to coastal cities, this puts limits on migration
- paperowkr to move
- ppl follow awarded
- ppl no follow not awarded bad
Causes and effects of demographic change in Mexico
increae indus and urbaz for decades
citizens leave small commun for dense popul urb seetings, north
factorials controlled by american mncs
internal migration south to north
Diaspora
when a group of people disperse in mass from og land
brain drain
when the best of society emigrate from og land for political or econ reasons
causes of emigration
poor econ
no jobs
no edu oppo
persecution
autho gov
causes of emigration in iran
brain drain, feel threatened by conserva theo state no risk incarcerration or worse
- frustraed by corrupt gov offi
- undemo little hope of demoz
- hostile to women, homos, eth minos, relig minos
causes of emigration in nigeria
brain drain, fear of instablity and poteint rule military back
- instability
- mass corru makes think nothing change
- relig and eth minos feel oppressed or denied oppos
- fear of violence and terrorism by boko haram
lead to diaspora
causes of immigration to UK
- demo
job
edu
social welfare programs
open civil soc
civil rights and libs freedoms
peace n stabil
consequences of migrations patterns
higher pop density lead to increase in crime
concen of high trained indivs in one area and no in others create imbalance and inequity
demands and comp for housing
demands and comp for jobs
poli parties emerge and anti immig or antisuporg
can threaten legiti of ogv
state responses to demographic pressures
pop stress
- encour immigration
- encour larger fams
rapid inc pop
- encourage birth control contracep
- infringe on reprod rights of fams
relig minos
- govs discour discrim against minos whereas others promote it
challnegs of againg pop in uk
birth rate slowed
dont like taxes bur cherish NHS
immigrants help replenish needs for workers
pop control in iran
used eucation to make women not stay home have kids
Russia on fams
- declining birth rate
- encour citizens to have kids
- inecentives
rentier states
oil state large %
corruption make it poop
iran, nigeria, russ
pros nationaliation
provides gov revenue
reduce poli influence of foreign govs
reduce poli influence of MNCs
reinforces poli legiti
cons natiobnalizaion
heavy gov control
inc corru
wealth concen among gov officials
no comp
pros privatization
dec gov control
inc innovation in indu
provides market price to cosumrs
inc cpital for further resources exploration
cons privizaaing
inc wealth inequity
bribes and kickback to gov officials to secure contracts
can lead to loss of sov
increases wealth inequality
resource curse
- lack of diversificcaation
- leads to a major imbalance in society between haves and have nots
- lack of desire to generate new industries or ideas
-little no taxes lack of accountabilty to citizens so ogv will be undemo - many rentier staaetessss are autjo
