AP Gov Unit 5 - Political and Economic Changes and Development

Economic globalization

Includes economic networks that are growing more interconnected, a worldwide market with actors unconstrained by political borders, and a reduction in state control over economies.

Multinational corporations (MNCs)

Businesses with a large presence in countries in different regions of the world, increasingly dominating global markets and posing challenges to domestic economic policies.

Special economic zones

Areas in China designated by the government as regions where private businesses could attract foreign direct investment.

Privatization

Government-owned industries transferred to businesses run with free-market forces and owned by private investors.

Nationalization

Government-owned industries run without free-market forces.

Foreign direct investment

Money invested in private businesses by individuals or corporations outside of the country, challenging a government's economic and political ideas.

Environmental degradation

Environmental problems created by industrialization and economic development.

International organizations

Organizations joined by member states with common interests, such as the International Monetary Fund (IMF), the World Bank, and the United Nations.

International Monetary Fund (IMF)

Exerts influence through preconditions for financial assistance, often requiring structural adjustment programs like privatization and reduced tariffs.

Supranational organizations

Organizations where member states grant governing organization sovereignty over policies related to trade, such as the European Union and the World Trade Organization.

Structural adjustment programs

Neoliberal reforms required by international organizations granting emergency loans, including privatization of state-owned companies and reduced tariffs.

Tariffs

Taxes imposed by a government against imported goods.

Subsidies

Government funding to support domestic industries against foreign competition or shape economic behaviors.

Import substitution industrialization (ISI)

Policies aimed at reducing foreign dependency by raising tariffs and encouraging local production of industrialized products.

Austerity measures

Funding cuts to state programs or tax increases intended to decrease budget deficits and national debt, often required for IMF emergency loans.

Gender equity

Civil rights ideal for women to be protected with equal treatment and to secure equal power as men in governing a country.

Maquiladora zones

Areas of Mexico's manufacturing industry, mostly located in northern Mexico, where factories assemble parts imported from the United States for assembly in Mexico.

Rentier states

Countries obtaining a sizable percentage of total government revenue from the export of oil and gas or leasing the resource to foreign countries, raising standards of living and funding governmental programs based on reserves.

Resource curse

Countries overly reliant on commodity exports facing negative economic, political, and environmental consequences.

Economic diversification

When a country achieves economic balance between agriculture, manufacturing, and services without overdependence on one commodity or economic sector.