World Politics: Interests, Interactions, Institutions - Key Terminology

Comprehensive vocabulary flashcards covering international security, alliances, civil conflict, terrorism, international trade, and international finance from World Politics: Interests, Interactions, Institutions.

alliances

Institutions that help their members cooperate militarily in the event of a war.

balance of power

A situation in which the military capabilities of two states or groups of states are roughly equal.

bandwagoning

A strategy in which states join forces with the stronger side in a conflict.

entrapment

The condition of being dragged into an unwanted war because of the opportunistic actions of an ally.

North Atlantic Treaty Organization (NATO)

An alliance formed in 1949 among the United States, Canada, and most of the states of Western Europe in response to the threat posed by the Soviet Union. The alliance requires the members to consider an attack on any one of them as an attack on all.

Warsaw Pact

A military alliance formed in 1955 to bring together the Soviet Union and its Cold War allies in Eastern Europe and elsewhere; dissolved on March 31, 1991, as the Cold War ended.

League of Nations

A collective security organization founded in 1919 after World War I. The League ended in 1946 and was replaced by the United Nations.

United Nations (UN)

A collective security organization founded in 1945 after World War II. With over 190 members, the UN includes all recognized states.

collective security organizations

Broad-based institutions that promote peace and security among their members. Examples include the League of Nations and the United Nations.

genocide

Intentional and systematic killing aimed at eliminating an identifiable group of people, such as an ethnic or religious group.

humanitarian interventions

Interventions designed to relieve humanitarian crises stemming from civil conflicts or large-scale human rights abuses, including genocide.

UN Security Council (UNSC)

The main governing body of the UN, which has the authority to identify threats to international peace and security and to prescribe the organization's response, including military and/or economic sanctions.

permanent five (P5)

The five permanent members of the UN Security Council: the United States, Great Britain, France, Russia (formerly the Soviet Union), and China.

veto power

The ability to prevent the passage of a measure through a unilateral act, such as a single negative vote.

peace-enforcement operation

A military operation in which force is used to make and/or enforce peace among warring parties that have not agreed to end their fighting.

peacekeeping operation

An operation in which troops and observers are deployed to monitor a cease-fire or peace agreement.

civil conflict

A conflict arising when individuals have interests that conflict with those of the central government, leading to demands that involve territory, policy, or government composition.

bargaining failures in civil war

The breakdown of bargaining between a government and a rebel group resulting from information problems, commitment problems, and issue indivisibilities.

international terrorist organizations

Groups composed of relatively small numbers of individuals with extreme preferences that attack civilians and organize into loose networks due to their weakness relative to their targets and goals.

strategies of violence (rebel groups and terrorists)

Tactics employed by violent groups intended both to coerce their targets and to address their collective action problem by attracting supporters.

comparative advantage

The ability of a country or firm to produce a particular good or service more efficiently than it can produce other goods or services, such that its resources are most efficiently employed in this activity. The comparison is to the efficiency of other economic activities that the actor might undertake given all the products it can produce—not to the efficiency of other countries or firms.

absolute advantage

The ability of a country or firm to produce more of a particular good or service than other countries or firms can produce with the same amount of effort and resources.

neo-mercantilism

A belief that national economic policy should encourage exports and discourage imports, and that the country should aim to run a trade surplus.

Heckscher-Ohlin trade theory

The theory that a country will export goods that make intensive use of the factors of production in which it is well endowed. For example, a labor-rich country will export goods that make intensive use of labor.

protectionism

The imposition of barriers to restrict imports.

trade barriers

Government limitations on the international exchange of goods. Examples include tariffs, quantitative restrictions (quotas), import licenses, requirements that governments buy only domestically produced goods, and health and safety standards that discriminate against foreign goods.

tariff

A tax imposed on imports. Tariffs raise the domestic price of the imported good and may be applied for the purpose of protecting domestic producers from foreign competition.

quantitative restriction (quota)

A limit placed on the amount of a particular good that is allowed to be imported and sold domestically.

nontariff barriers to trade

Obstacles to imports other than tariffs (trade taxes). Examples include restrictions on the number of products that can be imported (quantitative restrictions, or quotas); regulations that favor domestic over imported products; and other measures that discriminate against foreign goods or services.

Stolper-Samuelson theorem

The theorem that trade protection benefits the scarce factor of PRODUCTION.

Ricardo-Viner (specific-factors) model

A model of trade relations that emphasizes the sector in which factors of production are employed rather than the nature of the factor itself. Differentiates from the Heckscher-Ohlin theory, in which the nature of the factor—labor, land, capital—is the principal consideration.

reciprocity

In international trade relations, a mutual agreement to lower tariffs and other barriers to trade. Involves an implicit or explicit arrangement for one government to exchange trade-policy concessions with another.

most-favored-nation (MFN) status

A status established by most modern trade agreements guaranteeing that the signatories will extend to each other any favorable trading terms offered in agreements with third parties.

World Trade Organization (WTO)

An institution created in 1995 to succeed the GATT and to govern international trade relations. Encourages and polices the multilateral reduction of barriers to trade, and it oversees the resolution of trade disputes.

General Agreement on Tariffs and Trade (GATT)

An international institution created in 1947 in which member countries committed to reducing barriers to trade and providing similar trading conditions to all other members. In 1995, the GATT was replaced by the WTO.

regional trade agreements (RTAs)

Agreements among three or more countries in a region to reduce barriers to trade among themselves.

portfolio investment

Investment in a foreign country via the purchase of stocks (equities), bonds, or other financial instruments. Portfolio investors do not exercise managerial control of the foreign operation.

sovereign lending

Loans from private financial institutions in one country to sovereign governments of other countries.

foreign direct investment (FDI)

Investment in a foreign country via the acquisition of a local facility or the establishment of a new facility. Direct investors maintain managerial control of the foreign operation.

concessional finance

A special kind of loan that is easier for countries to pay back; often used by governments, international organizations, or development banks to help poorer countries that might not otherwise get funding.

multinational corporation (MNC)

An enterprise that operates in a number of countries, with production or service facilities outside its country of origin.

global supply chains

A network of customers and suppliers involved in the production and distribution of a product. Parts of it may be inside a multinational corporation; parts may also involve links between corporations.

reshoring

Refers to bringing a business operation that was previously moved abroad back to its original home country.

friendshoring

The practice of relocating production to countries that share similar values or maintain strong alliances with the United States, often for reasons of economic security.

bilateral investment treaty

An agreement between two countries about the conditions for private investment across borders. Most of these treaties include provisions to protect an investment from government discrimination or expropriation without compensation as well as mechanisms to resolve disputes.

recession

A sharp slowdown in the rate of economic growth and economic activity.

depression

A severe downturn in the business cycle, typically associated with major declines in economic activity, production, and investment; a severe contraction of credit; and sustained high unemployment.

default

To fail to make payments on a debt.

austerity

The application of policies to reduce consumption, typically by cutting government spending, raising taxes, and restricting wages.

Bank for International Settlements

One of the oldest international financial organizations, created in 1930. Its members include the world's principal central banks, and under its auspices they attempt to cooperate in the financial realm.

International Monetary Fund (IMF)

A major international economic institution established in 1944 to manage international monetary relations. It has gradually reoriented itself to focus on the international financial system, especially debt and currency crises.

World Bank

An important international institution that provides loans at below-market interest rates to developing countries, typically to enable them to carry out development projects.

exchange rate

The price at which one currency is exchanged for another.

appreciate

In terms of a currency, to increase in value relative to other currencies.

depreciate

In terms of a currency, to decrease in value relative to other currencies.

devalue

To reduce the value of one currency relative to other currencies.

monetary policy

An important tool of national governments to influence broad macroeconomic conditions such as unemployment, inflation, and economic growth. Typically, governments alter their monetary policies by changing national interest rates or exchange rates.

central bank

The institution that regulates monetary conditions in a country's economy, typically by raising or lowering interest rates and the quantity of money in circulation.

fixed exchange rate

An exchange-rate policy under which a government commits itself to keeping its currency at or around a specific value relative to another currency or a commodity, such as gold.

gold standard

The monetary system that prevailed between about 1870 and 1914, in which countries tied their currencies to gold at a legally fixed price.

floating exchange rate

An exchange-rate policy under which a government permits its currency to be traded on the open market without direct government control or intervention.

Bretton Woods monetary system

The economic order negotiated among allied nations at Bretton Woods, New Hampshire, in 1944, which led to a series of cooperative arrangements involving a commitment to relatively low barriers to international trade and investment.

adjustable peg

A monetary system of fixed but adjustable rates. Governments are expected to keep their currencies fixed for extended periods but are permitted to adjust the exchange rate from time to time as economic conditions change.

international monetary regime

A formal or informal arrangement shared by most countries in the world economy to govern relations among their currencies