Chapitre 2

Question 1

what is included in political economy ? name the 3 section seen in this chapter.

Answer 1

Political, economic, and legal systems of a country.
These systems are interdependent.
They influence each other.

Question 2

what is political systems and name the two demensions.

Answer 2

DEF : The system of government in a nation

Assessed according to two dimensions:
Emphasis on collectivism or individualism.
Degree to which they are democratic or totalitarian.

Question 3

What is collectivism ? Socialism ? explain difference communists vs democrats ?

Answer 3

Collectivism: Emphasizes collective goals over individual goals.

Socialism – Modern version of collectivism
Public ownership of the means of production for the common good.
Karl Marx: the few benefit at the expense of the many in a capitalist society where individual freedoms are not restricted.
Communists (use of dictatorship) vs. social democrats (use of democratic means).

Question 4

what is privatization ?

Answer 4

Privatization: selling state-owned companies to private investors
Privatization is a sign of commitment towards free market economics

Question 5

What is individualism and talk about the 2 tenets ?

Answer 5

Individualism:
An individual should have freedom in economic and political pursuits.
The interests of the individual should take precedence over the interests of the state.

The two (2) underlying tenets of individualism:
Guarantee of individual freedom and self-expression.
Welfare of society best served by letting people pursue their own economic self-interest.

Question 6

define democracy and totalitarianism

Answer 6

Democracy: government is by the people, exercised either directly or through elected representatives.

Totalitarianism: one person or political party exercises absolute control over all spheres of human life and prohibits opposing political parties.

Question 7

what is representative democracy? what are the safeguard?

Answer 7

Representative democracy: citizens periodically elect individuals to represent them.
Includes a multitude of safeguards that are typically based in constitutional law, including:
Freedom of expression.
Free media.
Universal adult suffrage: theright to votefor as many people who are bound by a government’s laws as possible, as supported by the”one person, one vote”principle.
Fair court system.

Question 8

name the 4 totalitarianism types and define .
first letters : CTTR

Answer 8

Communist totalitarianism: socialism can be achieved only through a totalitarian dictatorship.
Theocratic totalitarianism: monopolized by a party, group, or individual that governs according to religious principles.
Tribal totalitarianism: a party, group, or individual that represents the interests of a particular tribe monopolizes political power.
Right-wing totalitarianism: generally permits individual economic freedom but restricts individual political freedom, including free speech, on the ground that it would lead to the rise of communism.

Question 9

what is a pseudo-democracies

Answer 9

Lie between pure democracies and complete totalitarianism systems.
Authoritarian elements have captured some or much of the machinery of state and use this to deny basic political and civil liberties.

Question 10

what is market economy ?

Answer 10

All productive activities are privately owned.
Production is determined by supply and demand.
To work, supply must not be restricted.
Role of government is to encourage vigorous free and fair competition.

Question 11

what is command economy?

Answer 11

Government plans the goods and services, quantity and price, then allocates them for “the good of society.”
All businesses are state owned.
Historically found in communist countries.
No incentive for individuals to look for better ways to serve needs.
Socialist-inclined governments

Question 12

what is mixed economy?

Answer 12

Some sectors are privately owned, some are government owned.
Once common in developed world, less so now.
Government may aid troubled firms whose operations are vital to national interests.
U.S. helped Citigroup, General Motors in 2008 recession.

Question 13

what is common law ?

Answer 13

Common law is based on tradition, precedent, and custom.
Tradition refers to a country’s legal history, precedent to cases that have come before the courts in the past, and custom to the ways in which laws are applied in specific situations.
When law courts interpret common law, they do so with regard to these characteristics. This gives a common law system a degree of flexibility that other systems lack.
More flexible than other systems.

Question 14

what is civil law?

Answer 14

Based on detailed laws organized into codes.
Less adversarial than a common law system.

Question 15

Theocratic law:

Answer 15

Based on religious teachings.
Most common is Islamic law.

Question 16

what is a contract law and how does it differ under civil and common law

Answer 16

Contract law: body of law that governs contract enforcement.
Under common law:
Contracts are very detailed with all contingencies spelled out.
More expensive and can be adversarial.
Under civil law:
Contracts tend to be much shorter and less specific.

Question 17

what is United Nations Convention on Contracts for the International Sale of Goods (C I S G):

Answer 17

Establishes a uniform set of rules governing certain aspects of the making and performance of everyday commercial contracts between sellers and buyers who have their places of business in different nations.
Applies automatically to all contracts for the sale of goods between different firms based in countries that have ratified the convention, unless the parties opt out.

Question 18

what are proprety rights

Answer 18

legal rights over the use to which a resource is put and over the use made of any income that may be derived from that resource.

Question 19

Property Rights and Corruption . Explain private vs public action

Answer 19

Public action and corruption:
Public officials extort income, resources, or property.
Can be done legally by levying excessive taxation, requiring licenses or permits from property holders, taking assets into state ownership without compensating owners, redistributing assets without compensating prior owners.
Can be done illegally through corruption, demanding bribes.

Private action:
Theft, piracy, blackmail by private individuals or groups.

Question 20

what is Foreign Corrupt Practices Act (F C P A):

Answer 20

Illegal to bribe a foreign government official to obtain or maintain business over which that foreign official has authority.
Requires all publicly traded companies to keep detailed records that would reveal whether a violation of the act has occurred.

Question 21

what is OECD’s Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (19 97):

Answer 21

Makes bribery of a foreign public official a criminal offense.
Allows for facilitating or expediting payments.

Question 22

what are Facilitating or expediting payments (also called grease payments or speed money) ? explain why it is considered legal compared to bribe.

Answer 22

the purpose of which is to expedite or to secure the performance of a routine governmental action.

The explanation for this exception to general antibribery provisions is that while grease payments are, technically, bribes, they are distinguishable from (and, apparently, less offensive than) bribes used to obtain or maintain business because they merely facilitate performance of duties that the recipients are already obligated to perform.

Question 23

what is intellectual property and name examples

Answer 23

Intellectual property: property that is the product of intellectual activity, such as computer software, a screenplay, a music score.
Patent: inventor’s exclusive rights for a defined period.
Copyrights: exclusive legal rights of authors, composers, playwrights, artists, and publishers.
Trademarks: officially registered designs and names used to differentiate products.

Question 24

what is product liability

Answer 24

Product liability involves holding a firm and its officers responsible when a product causes injury, death, or damage.
Can be much greater if a product does not conform to safety standards.
Criminal and civil laws apply.
Raises ethical issues when doing business abroad.