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Flashcards in 1. Intro Slide Deck (29)
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1
Q

Name the general dates for the first and second waves of globalization.

A

Second wave of globalization began approximatly in the 1950s, when world trade grew steadily in dollar terms and as a ratio to GDP.

2
Q

What is the “spirit” of globalization? and how is it divided?

A

It is the Political and Institutional Basis for Globalization, and it includes practices and mechanisms such as: peace; legal (property rights, contract enforcement); trade policy (tariffs, quotas, etc.); and stable currency. It is divided into “strong” and “weak” eras.

3
Q

What is the “flesh” of globalization and how is it divided?

A

The flesh is the economic and technological basis for Globalization and it includes mechanisms and policies such as: transport costs; finance & banking; comparative advantage; economies of scale; and product variety. It is divided between weak and strong eras.

4
Q

Describe trade of the Classical to Medieval Era (up to 15th C)

A

International trade was very limited due to:

  • High transportation costs, risky travel, pre-industrial production, technology, subsistence agriculture.
  • Prohibitive policies.
5
Q

Describe Early Modern Era trade (16th - 18th C)

A

International trade began to increase under state sponsorship:

  • Exploration
  • Colonization
  • Merchant-Adventurer trading companies (Hudson’s Bay, Dutch East India, etc.)
6
Q

Describe the progress of international trade during the two World Wars and the Great Depression.

A

International trade and investment collapses under the weight of the two World Wars and the Great Depresion

7
Q

Describe interwar trade policy during the two World Wars.

A
  • The Smoot-Hawley Tariff Act was signed into law in June 1930, raising the tariffs to as high as 60% on many categories of imports.
  • Thses tariffs were applied by the US to protect farmers and other industries, but they backfired by causing other countries to retaliate.
8
Q

Why did the Smoot-Hawley Tariff fail?

A

As the US raised its tariffs, so did other countries in retaliation, resuting in a dramatic increase in tariffs all over the world.

9
Q

What were some of the causes of the 2nd wave of Globalization? Also, when did the 2nd wave begin?

A

The end of WWII paved the way for a second wave of globalization along with the creation of multilateral institutions (e.g. GATT/WTO) and lower transportation costs (air travel, container shipping, information technology).

10
Q

Define the Pattern of Trade:

A
  • What goods and services a country trades, with whom, and in what direction
  • What gets traded?
    • Which goods are traded the most?
    • Which countries trade which goods?
11
Q

Today, what percentage of the volume of trade is in manufactured products? lists examples.

A

Today about 55% of the volume of trade is in manufacutured products such as automobiles, computers, clothing, and machinery. Services such as shipping, insurance, legal fees, and spending by tourists account for about 20% of the volume of trade. Mineral products (petroleum, coal, copper) and agricultural products are relatively small part of trade.

12
Q

What were the main differences between the two waves of globalization.

A
  • The growth of trade and investment in the second wave exceeded that of the first.
  • The coposition of trade also changed:
    • First wave: agricultural goods and raw materials from South traded for manufactures (capital and consumer goods) from the North.
    • Second wave: Two-way trade in manufactures; fragmentation of production; rise of trade in service.
13
Q

How has trade changed in deveolping countries? Include dates.

A
14
Q

In 1910, Britain mainly imported 1. _______ and 2. _________ products, while 3. _______ products represented most of the volume of exports

A
  1. Agricultural
  2. Mineral
  3. Manufactured
15
Q

In 1910, the US mainly imported and exported 1. __________ and 2. _________ products.

A
  1. Agricultural
  2. Mineral
16
Q

In 2002, __________ products made up most of the volume of imports and exports for both Britian and the US.

A

Manufactured products

17
Q

In 2001, about 65% of exports from low- and middle-income countries were ________products, and only 10% of exports were ____________ products.

A
  1. Manufactured
  2. Agricultural
18
Q

In 1960, about 58% of exports from low- and middle-income countries were 1. ________ products and only 12% of exports were 2._________ manufactured products.

A
  1. Agricultural
  2. Manufactured
19
Q

What are the top ten US imports in 2008?

A
20
Q

What are the top ten US exports in 2008?

A
21
Q

Define production fragmentation

A

Dividing up the “value-chain” of production among plants in different locations.

22
Q

Define multinaitonal firms

A

Firms that own plants in different countries

23
Q

Define outsourcing

A

Occurs when some part of the production process is done outside the firm (can be international or domestic).

24
Q

Define Offshoring

A

Occurs when some part of the production proces is done in a different country (can be inside or outside the firm)

25
Q

Technology/knowledge transfer

A

Supplying technology or design specifications to a supplier.

26
Q

In most countries, the majority of output is in the form of _______

A

Services

27
Q

In advanced countries more than ______% of employment is in services.

A

80%

28
Q

Most services are nontradable because they _______________.

A

Because hte need to be done close to the customer

29
Q
  1. _________ is in fact the largest exporter of services, and exports 2. __________ than it imports.
A
  1. The US
  2. Much more than it imports