Unit 9.4 - Economics in the Global Age

Question 1

Economic Liberalization

Answer 1

The opening up of a country’s economy to global trade

Question 2

How Ronal Regan/Margaret Thatcher promoted economic liberalization

Answer 2

Since they wanted free markets, they advocated for cutting taxes, regulations, and government assistance to the poor to help grow the economy

Question 3

Free Market

Answer 3

An economic system based on supply and demand with as little government control as possible

Question 4

Globalization

Answer 4

The interaction among people, governments, and companies around the world

Question 5

Examples (2) of Globalization

Answer 5

The Indian Ocean Trade and European imperialism

Question 6

How the end of the Cold War promoted economic liberalization

Answer 6

The end of the Cold War meant that previous Soviet satellites could now trade with capitalist, democratic, countries and nonaligned states could also relax restrictions

Question 7

How Augusto Pinochet promoted economic liberalization

Answer 7

Communist leader of Chile, he helped reduce poverty and increase economic growth by privatizing businesses, taming inflation, and free trade

Question 8

Ways (5) Deng Xiaoping changed China’s economy

Answer 8

With his policy “Let some people get rich first” he promoted economic growth rather than equality by allowing peasants to lease plots of land, factories to produce more products for consumers, encouraged foreign companies to set up factories in their economic zones, reopened the Shanghai stock market, and allowed for the private ownership of some businesses

Question 9

Did political liberalization occur under Deng Xiaoping’s rule?

Answer 9

No, people wanted increased freedom of speech and press and for the Communist Party’s monopoly on political power to end but as seen in the Tiananmen Square Massacre, the request was not received well

Question 10

Knowledge Economy

Answer 10

One that focuses on creating, distributing, and using knowledge and information rather than manufacturing

Question 11

How the USA has a knowledge economy

Answer 11

Educated workers in California for example use their knowledge for other people to share theirs through technology, communication, innovation, and collaboration

Question 12

How Finland has a knowledge economy

Answer 12

After the Soviet Union collapsed Finland entered the global marketplace and established the Science and Technology Policy Council, promoting economic growth through technology and innovation, and eventually, they led the way in developing smartphones.

Question 13

Examples of how Japan’s economy growth modeled mercantilist policies

Answer 13

They increased exports, decreased exports with tariffs, and encouraged competition

Question 14

Asian Tigers

Answer 14

Hong Kong, Singapore, South Korea, and Taiwan

Question 15

As the knowledge economy developed in some regions, production and manufacturing in those regions, including in the _____ have declined

Answer 15

U.S.

Question 16

Manufacturing plants are located in _____ and _____ rather than the US and Europe

Answer 16

Asia and Latin America

Question 17

Largest Exports in Bangladesh and Vietnam

Answer 17

Clothing (and electronic goods for Vietnam)

Question 18

NAFTA and how it affected trading in Mexico

Answer 18

The North American Free Trade Agreement; it encouraged Canadian and U.S. companies to build maquiladoras (factories) in Mexico because they had lower wages. The goods produced would then be free of any tariffs. This led to thousands of US jobs being moved to Mexico

Question 19

GATT Agreement

Answer 19

The General Agreement on Tariffs and Trade, signed by economic organizations like the European Economic Community, Mercosur (in South Amer.), and the Association of Southeast Asian Nations

Question 20

How the GATT Agreement attempted to promote free trade

Answer 20

It attempted to promote free trade by lifting restrictive barriers to trade

Question 21

Protective Tariffs

Answer 21

Taxes on foreign imports

Question 22

Multinational Corporations

Answer 22

Basically joint-stock companies, these corporations are established in one country but then make/sell their goods and services in other countries

Question 23

How multinational corporations take advantage of knowledge economies and traditional manufacturing

Answer 23

They hire workers in knowledge economies like engineers but then employ workers in low-wage foreign countries to manufacture goods they sell in their global market.

Question 24

Similarities and differences between NAFTA and GATT

Answer 24

Both attempt to promote economic liberalization through the reduction of tariffs but NAFTA is on a smaller scale while the GATT Agreement connected more regions and was then taken over/corrupted by the World Trade Organization

Question 25

Are multinational companies and their presence a continuation or change in history?

Answer 25

Continuity, joint stock companies in the past have done the same of being established in one country but then spreading their goods, influence, and control to others such as the British East India Company establishing a major presence in India and helping Britain colonize the country and the Dutch East India country with the Spice Islands.