Studied by 4 people
Keyword from chapters 14, 15, 16, 18, 19, 20
Gains from trade
Refers to the benefits countries or individuals get from specializing in production and exchanging goods and services.
Free trade
Refers to the absence of government intervention, trade can happen without any restrictions.
Specialization
Occurs when an individual, firm or country concentrates production on one or a few goods and services.
Trade protection
Involves government intervention in international trade through the implementation of trade restrictions.
Tariffs
They are taxes put on imported goods to protect domestic industries or raise government revenue.
Import quota
It’s a limit on the quantity if a good that can be imported into a country to protect domestic industries
Export subsidies
Are government payments to domestic producers to help them sell goods abroad at lower prices and increase competitiveness.
Administrative Barriers
They are government rules and regulations that make it harder for imports to enter a country, often to protect domestic industries.
Infant industry
Is a new or developing industry that may need government protection to compete with established foreign competitors.
Diversification
Is the process of expanding the range of g/s’s produced to reduce dependence on a few industries and lower economic risk.
Economically least developed countries
Nations with low income, weak human development and vulnerable economics.
Anti-dumping
Refers to government measures, like tariffs, to prevent foreign firm from selling goods below cost to protect domestic industries.
Economic interigation
Is the process of countries reducing trade barriers and coordinating policies to increase economic cooperation and benefits.
Preferential trade agreement
It’s an agreement between two or more countries to lower trade barriers on particular products in trade between each other.
Bilateral trade agreement
Agreement between two countries.
Multilateral trade agreement
Agreement between many countries.
Regional trade agreement
Agreement between countries that are within a geographical region.
Trade liberalisation
Free trade by reducing or eliminating trade barriers between members.
Rading bloc
Is a group of countries that agree to reduce or eliminate trade barriers between them to promote economic integration.
Free trade area
Is a group of countries that remove trade barriers between themselves but maintain independent trade policies with non-members.
Custom union
Is a group of countries that remove trade barriers between themselves and adopt a common external tariff on imports from non-members.
Common market
Is a group of countries that remove trade barriers, allow free movement of labour and capital, and adopt common external trade policies.
Monetary union
Is a group of countries that share a common currency and have a unifies monetary policy.
World Trade Organization (WTO)
It’s an international organization that sets trade rules and resolves disputes to promote free and fair global trade.
Primary products
They are raw materials or natural resources, like agriculture, fishing and mining products, used as inputs for production.
Foreign exchange
Is the trading of different currencies in the global market for international transactions and investments.
Exchange rate
It’s the value of one currency expressed in terms of another.
Floating exchange rate system
When a currency’s value is determined by market forces of supply and demand without government intervention.
Appreciation
An increase in the value of a currency in a floating exchange rate system due to market demand.
Depreciation
It’s a decrease in the value of a currency in a floating exchange rate system due to market forces.
Foreign direct investment
When a company or individual invests in a business or assets in another country
Portfolio investment
It’s the purchase of financial assets like stocks and bonds in foreign countries without gaining control over businesses.
Remittance
Money sent by foreign workers to their home country, usually to support family members.
Speculation
Buying and selling currencies to make a profit from changes in exchange rate.
Fixed exchange rate system
When the country’s currency value is set and maintained by the government or central bank against another currency or a basket of currencies.
Devaluation
When a government lowers the fixed exchange rate of its currency, making it weaker compared to other countries.
Revaluation
When the government increases the fixed exchange rate of its currency, making it stronger compared to other currencies.
Managed exchange rates
When a country’s currency value is mostly determined by market forces, but the central bank intervenes occasionally to stabilize or influence the rate.
Overvalued currency
When a currency’s exchange rate is higher than its market equilibrium, making exports more expensive and imports cheaper.
Undervalued currency
When a currency’s exchange rate is lower than its market equilibrium, making exports cheaper and imports more expensive.
Balance of payments
It’s a record of all economic transactions between a country and the rest of the world over a period of time.
Credits
Payments received from other countries.
Debits
Payments made to other countries.
The balance of trade in goods
Is the difference between a country’s exports and imports of physical goods.
Balance of trade in service
The difference between a country’s exports and imports of services, such as tourism and banking
Current transfer
Are one-way payments between countries, like foreign aid, remittances, and donations, with no exchange of goods and services.
Current account balance
It’s the sum of a country’s trade in goods and services, income and current transfers with the rest of the world.
Current account deficit
When a country spends more on imports, income payments and transfers than it earns from exports and other inflows.
Current account surplus
When a country earns more from exports, income, and transfers than it spends on imports and other outflows.
Capital transfer
One-time payment between countries for investment purposes, such as debt forgiveness or funding infrastructure projects.
Non-produced
Are natural resources or intangible assets, like land, mineral rights, or patents, that have not been created through production.
Non financial assets
Are physical or intangible assets, like land, buildings, machinery and patents, that are not related to financial investments.
Capital account
It records one-time transfers and transactions of non-produced, non-financial assets, such as debt forgiveness and sale of land.
Foreign direct investment
When a company makes an investment in business or assets in another country, gaining control or significant influence over entity.
Reserve assets
Are foreign currencies, gold and other assets held by a country’s central bank to manage its exchange rate and settle international transactions.
Official borrowing
Refers to the government borrowing from abroad.
Financial account
Records transactions related to investments, such as foreign direct investment (FDI), portfolio investment, and official borrowing, affecting a country’s financial assets and liabilities.
Sustainable development
It’s economic growth that meets present needs without compromising the ability of future generations to meet their own needs. Balancing economic, social and environmental factors.
Sustainable development goals
They are 17 global targets set by the UN to promote economic growth, social inclusion and environmental protection by 2030.
Economic development
It’s the improvement of living standards, income, and well-being in a country through growth, infrastructure and social progress.
Indicators
They are measurable statistics like GDP, literacy rates and life expectancy used to assess economic performance and development.
Composite indicators
They combine multiple economic and social measures, like the Huaman Development Index (HDI), to give a broader view of development.
Human Development Index (HDI)
Measures a country’s development using three factors: Life expectancy, education level, and income per capita.
Inequality-adjusted Human Development Index (IHDI)
Adjusts the HDI for inequality, showing the actual level of human development experienced by people.
Gender Inequality Index (GII)
Measures gender disparities in health, empowerment and labour market participation within a country.
Happy Planet Index (HPI)
Measures deprivation in basic human development, including life expectancy, education and living standards.
Poverty cycle
It’s a self-reinforcing situation where poverty persists across generations due to low income, poor education and limited opportunities.
Infrastructure
Refers to basic physical and organizational structures, like roads, electricity and water supply that support economic activity and development.
Appropriate Technology
Technology that is affordable, sustainable and suited to the social, economic and environmental conditions of a country or community.
Primary sector
Involves the extraction and harvesting of natural resources, such as agriculture, mining, fishing and forestry.
Informal economy
Includes unregulated and unregistered economic activities, such as street vending and casual labour, that are not taxed or protected by formal labour laws.
Capital flight
Refers to the large-scale movement of financial assets or capital out of a country, often due to economic instability, high taxes or political uncertainty.
Dept relief
It’s the reduction, restricting or cancellation of a country’s debt to make it more manageable, often provided by international organizations or creditor nations.
Property rights
Are legal protections that grant individuals or organizations the right to own, use and transfer assets, such as land or intellectual property.
Land rights
Refers to the legal rights and access individuals or groups have to own, use and manage land.
Governance
Refers to the processes and structures used to make decisions, implement policies and manage a country or organization effectively.
Import subsititution
It’s a trade policy where a country reduces reliance on imports by producing goods domestically to promote local industries.
Export promotion
It’s a strategy where government support domestic industries to increase exports through subsidies, trade agreements and incentives.
Diverisifcation
It’s the process of expanding the range of goods, services, or industries in an economy to reduce dependence on a single sector and lower risks
Social enterprise
It’s a business that aims to solve social or environmental problems while also generating revenue to sustain its operations.
Trade liberalisation
It’s the process of reducing or eliminating trade barriers, like tariffs or quotas, to promote free trade and economic growth.
Foreign direct investment (FDI)
When a company or individuals invest in a business in another country, gaining control or significant influence over its operations.
Multinational corporation (MNC)
It’s a company that operates and has assets in multiple countries beyond its home country.
Foreign aid
Financial, technical or humanitarian assistance given by one country or organization to another to support development and welfare.
Humanitarian aid
It’s emergency assistance, such as food, medicine, and shelter, provided to countries or people affected by crises like natural disaster or conflict.
Development aid
It’s financial or technical assistance provided to support long-term economic growth and improve living standards in developing countries.
Official Development Assistance (ODA)
It’s government aid provided to developing countries to promote economic development and welfare.
Non-governmental organisation (NGOs)
They are independent, non-profit organizations that work on social, environmental or humanitarian issues, often providing aid and development support.
Multilateral development assistance
It’s financial or technical aid provided by international organizations, like World Band or IMF, to support economic development in multiple countries.
World Bank
It’s an international financial institution that provides loans and grants to countries for development projects aimed at reducing poverty and promoting economic growth.
International Monetary Fund (IMF)
It’s an international organization that provides financial assistance, policy advice, and economic monitoring to help countries maintain stability and growth.
Microfinance
Refers to small loans and financial services provided to low-income individuals or small businesses that lack access to traditional banking.
Mobile banking
It’s the use of mobile devices to access financial services, such as transfers, payments and account management, without needing a physical bank.
Market-oriented policies
They are economic strategies that promote free markets, competition, and minimal government intervention to encourage efficiency and growth.
Interventionist policies
They are government strategies that involve active participation in the economy to correct market failures, promote growth or achieve social objectives.
