Ch. 1 (NEW) - Globalization Lecture Practice Flashcards

A comprehensive set of vocabulary flashcards covering the key concepts, institutions, and debates of globalization as presented in the Chapter 1 lecture notes.

Globalization

The shift toward a more integrated and interdependent world economy, creating both opportunities and challenges for management practice.

Globalization of Markets

The merging of historically distinct and separate national markets into one huge global marketplace.

Globalization of Production

Sourcing goods to take advantage of differences in cost and quality of factors of production.

Factors of Production

Essential resources including labor, energy, land, and capital.

Global Products

A term suggested by Robert Reich to describe products whose components are sourced from multiple locations worldwide.

General Agreement on Tariffs and Trade (GATT)

An international treaty that preceded the World Trade Organization and worked to lower barriers to the free flow of goods across national borders.

World Trade Organization (WTO)

The organization that polices the world trading system and ensures nation-states adhere to the rules; as of $2021$, it had $164$ members.

International Monetary Fund (IMF)

An institution established to maintain order in the international monetary system, often serving as a lender of last resort for countries in economic crisis.

World Bank

An international organization focused on making low-interest loans to cash-strapped governments in poor nations for significant infrastructure investments.

United Nations (UN)

An organization of $193$ member countries dedicated to maintaining international peace and security and promoting respect for human rights.

UN Charter

The foundational document of the United Nations that outlines four basic purposes: peace, friendly relations, international problem-solving, and harmonizing national actions.

Group of Twenty (G20)

A forum consisting of finance ministers and central bank governors from the $19$ largest economies, the European Union, and the European Central Bank.

International Trade

Occurs when a firm exports goods or services to consumers in another country.

Foreign Direct Investment (FDI)

Occurs when a firm invests resources in business activities outside its home country.

Uruguay Round

The round of negotiations that extended the General Agreement on Tariffs and Trade (GATT) and established the World Trade Organization (WTO).

Microprocessor

The single most important innovation in communications technology since World War II, enabling the growth of high-power, low-cost computing.

Moore’s Law

The prediction that the power of microprocessor technology doubles and its cost of production falls in half every $18$ months.

Containerization

A transportation technology that simplifies the transshipment from one mode of transport to another, significantly lowering costs and 'shrinking the globe.'

Outward Stock of Foreign Direct Investment (FDI)

The total cumulative value of foreign investments by firms domiciled in nations outside of that nation’s borders.

Multinational Enterprise (MNE)

Any business that has productive activities in two or more countries.

Mini-multinationals

Medium- and small-sized businesses that increasingly engage in international trade and investment, aided by the internet.

Lender of Last Resort

A role often attributed to the IMF because it requires nation-states to adopt specific economic policies in exchange for loans during crises.

Antiglobalization Protests

Social movements that began in $1999$ at the WTO meeting in Seattle, driven by concerns over living standards, wage rates, and the environment.

Supranational Organizations

Global entities such as the WTO, EU, and UN that critics argue are gaining power at the expense of national governments.

Liberal Economic Policies

Market-based economic systems and free-trade practices increasingly adopted by countries that formerly opposed them.

International Business

Any firm that engages in international trade or investment, facing a wider and more complex range of problems than purely domestic firms.

Poverty Headcount Ratio at $\$1.90$ a day

A metric for extreme poverty that declined from $43$ in $1981$ to $10$ in $2015$ (per $2011$ PPP).

Poverty Headcount Ratio at $\$5.50$ a day

A metric for poverty that averaged at $67$ between $1981$ and $1999$ before falling to $47$ by $2015$ (per $2011$ PPP).

Skilled Labor

A segment of the workforce whose share of national income has increased over the past two decades despite broader globalization concerns.

Technology-induced shift

The primary cause, more so than globalization, for the declining share of national income enjoyed by labor and the weak growth of real wage rates for unskilled workers.