year 12 term 4 Flashcards
(16 cards)
what is trade diversion
Trade agreements lead to increased trade between the members of an agreement, and a reduction in trade with countries that are not apart of the trade agreement, with no overall increase in trade
Which industries are most likely to suffer the most from a shift to free trade policies
Infant industries and import-competing industries.
What is the role of the World Bank in the economy
Assisting poorer countries with their economic development through loans at low-interest rates.
What is a monetary union
A group of economies with a common currency.
When is it efficient for one economy to trade with another
When one economy can produce one product at a lower opportunity cost than the other one.
What is used to calculate the human development index
Gross domestic product per capita at purchasing power parity, levels of educational attainment, life expectancy at birth.
How is the human development index derived
Life expectancy at birth, educational attainment, and GNI per capita.
What is purchasing power parity
Purchasing power parity is a theory that measures prices at different locations using a common good or goods to contrast the real purchasing power between different currencies.
What is GNI
The gross national income, previously known as a gross national product, is the total domestic and foreign output claimed by residents of a country, consisting of gross domestic product, plus factor incomes earned by foreign residents, minus income earned in the domestic economy by nonresidents.
What is a TVE
A township and village enterprise are market-oriented public enterprises under the purview of local governments based in townships and villages in China.
What is an MNC
A multinational corporation or worldwide enterprise is a corporate organization that owns or controls the production of goods or services in at least one country other than its home country.
What are my 3 points for the essay
- Agriculture reformation
- Open Door Policy
- Tariff Cuts
What do I say in my introduction
China is huge. They used Strategies to make them huge over 50 years. List strategies. China surpassed usa with 18% global GDP whilst usa had 15% global GDP. China accounts for 10% exports.
What do i say in my 1st paragraph
Agricultural reformations lasted from 1978 - 1994. They were done to boost food production and investment for TVEs. They abandoned the Commune system and replaced it with a Household responsibility system. Household allowed households to make own production decisions and sell the surplus in free markets. Grain output was increased by 50% from 1978 - 1985. Fixed chinas food shortage which has lasted decades. 15.7% real annual increase in farmers’ incomes from 1978 to 1985. In the same period, agricultural value grew at an annual rate of 7% while in the early 1970s it was 2%. Real GDP growth increased by 1.5%. This household responsibility system encouraged people to work for a TVE. With 100 million more jobs being created during the agricultural reforms. Conclude it by saying how it does question.
What do i say in my 2nd paragraph?
Implementation open door policy in 1980. The policy was implemented through SEZ established in the southern and eastern coasts of China. They attracted FDI because low labor costs, low tax, exemption of import duties and low power costs. This caused inflow of foreign technology to be imported into china and created employment in chinas manufacturing sector. Chinas economy was more than doubled from 1980 - 1990 in PPP terms of chinese yuan from 300 to 1110. Chinas HDI increased from 0.55 to 0.65 from 1975 - 1990. The policy reduced people in absolute poverty from 542 million in 1980 - 375 million in 1990. Talk about inequality from SEZ. Conclude.
What do i say in my 3rd paragraph.
Chinas tariff cuts from 1991 - 2000. They did it to encourage greater domestic efficiency through direct import competition. In 1991 China reduced tariffs on 265 import commodities. In 1992 China decreased tariffs by 7% to an overall 39%. From 1993, China adjusted import tariffs on 3000 commodities, reducing tariffs by 9%. Futhermore chinas average tariff was cut from 30% to 19% in 1995 and reduced to 15% in 2000. Talk about how this caused FDI to be higher cuz china is cheap and how that intergrates with economic development. Conclude.
