Bretton Institutions & Global Governance: Multilateralism, Unilateralism, and Economic History

What is multilateralism?

Several governments coming together to form a consensus.

Why is multilateralism important?

It creates order among nations and prevents conflict.

What is unilateralism?

One government makes decisions without consulting other governments.

Give an example of unilateralism.

America imposing tariffs on other countries without consultation.

What was the Great Depression?

A global recession that began with the stock market crash in October 1929.

What economic belief was shared during the Great Depression?

Power Concentration: The Only way to achieve economic security was through economic liberalization

What led to the rise of government intervention during the Great Depression?

The belief that economic security could only be achieved through economic liberalization.

What was the Bretton Woods Conference?

A 1944 meeting of 44 countries to establish a monetary order to prevent future wars.

What are the two main institutions created from the Bretton Woods Conference?

International Monetary Fund (IMF) and International Bank for Reconstruction and Development (IBRD).

What was the purpose of the Marshall Plan?

To provide financial aid to rebuild countries affected by World War II and prevent the spread of communism.

What does IMF stand for?

International Monetary Fund.

What is the primary function of the IMF?

To provide international liquidity and help countries with trade deficits.

What does IBRD focus on?

Economic growth and international trade.

What is a 'beggar thy neighbor' policy?

Economic policies that benefit one country at the expense of others.

What was the significance of the Nixon Shock?

It ended the convertibility of the US dollar to gold, leading to a floating-rate currency system.

What was the Smithsonian Agreement?

An informal agreement to stabilize the price of gold and maintain the dollar's value.

What caused the decline of the Bretton Woods system?

Structural changes, including the US balance of payments crisis and the growth of international currency markets.

What are some criticisms of the IMF?

Policies seen as 'too little, too late' and severe fiscal measures that can harm economies.

What was the impact of the 2008 recession on PIIGS countries?

Countries like Greece faced bankruptcy due to hidden debts and excessive borrowing.

What is Keynesian economics?

The theory that governments should take action during recessions to stimulate the economy.

What was the role of the US dollar after World War II?

It became the world's most popular currency, backed by the gold standard.

What were the Cold War tensions between capitalism and communism?

A conflict of ideologies between the USA and USSR from 1946 to 1991.

What led to the rise of American hegemony after WWII?

Military supremacy and economic support through initiatives like the Marshall Plan.

What is economic integration?

The process of countries becoming more interconnected economically, exemplified by the creation of the EU.

What was the impact of the 1997 Asian financial crisis?

Countries like Thailand, Indonesia, and South Korea managed to repay their loans quickly despite economic challenges.