Global Political Economy & Free Trade Dilemmas (IGI:Chapters 9 & 10)

ODA

Official Development Assistance

FDI

Foreign Direct Investment - Investment made by a foreign company in the economy of another country

GDP

Gross Domestic Product- the total market value of all final goods and services produced annually in an economy)

GNI (Gross National Income)

The value of the output of goods and services produced in a country in a year (GDP + FDI - interest & debt payments = GNI)

MDC

(More Developed Country) A country that has progressed relatively far along a continuum of development.

LDC

(Less Developed Country) A country that is at a relatively early stage in the process of economic development

Colonialism

An attempt by one country to establish settlements and to impose its political, economic, and cultural principles in another territory.

core countries

According to world systems theory, the most advanced industrial countries, which take the lion's share of profits in the world economic system.

periphery countries

the least developed and least powerful nations; often exploited by the core countries as sources of raw materials, cheap labor, and markets

Direct Rule

A system of government in which a province or colony is controlled by a central government--usually in urban areas.

Indirect Rule

Colonial government in which local rulers are allowed to maintain their positions of authority and status by a core country-usually in rural areas.

Bretton Woods Conference

Meeting of Western allies to establish a postwar international economic order to avoid crises like the one that spawned World War II. Led to the creation of the International Monetary Fund (IMF) and the World Bank, designed to regulate currency levels and provide aid to underdeveloped countries.

IMF

International Monetary Fund//a United Nations agency to promote trade by increasing the exchange stability of the major currencies

IBRD (World Bank)

International Bank for Reconstruction and Development (1944); Established as part of the Bretton Woods system. Created to finance reconstruction after WWII. Since 1950s it has lent money to lesser developed countries to finance development projects and humanitarian needs.

GATT

(General Agreement on Tariffs and Trade) An international agreement first signed in 1947 aimed at lowering trade barriers and promoting free trade policies.

WTO

(World Trade Organization) the only international body dealing with the rules of trade between nations

Conditionality

the requirements imposed on prospective borrowers by the IMF or other lending institutions that emphasize economic growth over welfare considerations

comparative advantage

the ability to produce a good at a lower opportunity cost than another producer

Structural Adjustment Program

Economic policies imposed on less developed countries by international agencies to create conditions encouraging international trade, such as raising taxes, reducing government spending, controlling inflation, selling publicly owned utilities to private corporations, and charging citizens more for services.

Privatization

To change from government or public ownership or control to private ownership or control.

Neoliberalism

A strategy for economic development that calls for free markets, balanced budgets, privatization, free trade, and minimal government intervention in the economy.

Mercantilism

An economic policy under which nations sought to increase their wealth and power by obtaining large amounts of gold and silver and by selling more goods than they bought

trade deficit

situation in which a country imports more than it exports

industrial policy

the view that government - using taxes, subsidies, and regulations - should nurture the industries and technologies of the future, thereby giving these domestic industries an advantage over foreign competition

Protectionism

the practice of shielding one or more industries within a country's economy from foreign competition through the use of tariffs or quotas

direct export subsidy

When the government pays a domestic firm for each good exported so that it can compete with foreign firms that otherwise would have a cost advantage (due to tariffs)

NAFTA

North American Free Trade Agreement; allows open trade with US, Mexico, and Canada.

TPP

The Trans-Pacific Partnership (TPP) is a trade agreement in February 2016. After the United States withdrew its signature the agreement could not enter into force. The remaining nations negotiated a new trade agreement called Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which incorporates most of the provisions of the TPP.

Level 1 chaotic systems

Systems that do NOT react to predictions made about it. (Eg: weather)

Level 2 chaotic systems

Systems that DO react to predictions made about it. (Eg: markets)