Midterm Exam Notes

  • Exam Format

    • All questions will have written answers.
    • Answers will vary in length and mark value.
    • Marks will be clearly indicated for each question, with more material compared to the midterm exam.
    • Total time allocated for the exam is 3 hours.
    • The material covered will be based on concepts discussed in class and readings since the midterm.

  • Cumulative Nature of the Exam

    • The exam is not cumulative; it will not cover material from the first week.
    • Focus will be on Modules 5 to 10, which were not included in the midterm exam.
    • Clarification on material from Module 5: it will be included in the exam despite being started before the midterm.

  • Understanding Questions

    • Read questions carefully, especially if more than one question is presented in a single item.
    • Responses should utilize various keywords; paraphrasing is acceptable as long as the answer makes sense and is relevant.

  • Discussion of Globalization

    • Definition: Refers to increased economic integration and interconnectedness of global economies.
    • The debate surrounding globalization addresses whether it is fundamentally good or bad.
    • Not all aspects of globalization are being discussed, particularly cultural aspects; the focus is on economic phenomena.

  • Historical Context

    • Previous periods saw significant economic integration prior to changes around the twentieth century, impacting international trade levels.
    • Factors considered in measuring globalization include:
    • International trade flow (goods and services).
    • Foreign direct investments (business investments made across borders).
    • Financial flows, which have significantly outpaced other forms of integration in the modern era.

  • Theoretical Foundations

    • Comparative Advantage: Key economic theory suggesting countries should produce goods they can efficiently create, leading to increased global trade and wealth.
    • The positive outcomes of free trade arise from improved efficiency and increases in product variety.

  • Criticism of Globalization

    • Concerns exist about downward pressures on labor standards and employment in countries with higher wage expectations as global competition increases.
    • Free trade can exacerbate imbalances in labor rights and economic power, leading to a race to the bottom regarding wages and working conditions.
    • Social Dumping: The practice of businesses benefiting from lax labor standards in developing countries can lead to negatively impacting labor conditions globally.

  • Labor Standards and Their Governance

    • WTO (World Trade Organization): Established to promote free trade by reducing tariffs and trade barriers; it prohibits member nations from enforcing labor standards.
    • ILO (International Labour Organization): Part of the UN, working to promote labor standards but operates on a voluntary basis without specific enforcement mechanisms.

  • Models of Labor Governance

    • Self-Governance: Corporations can adopt voluntary codes of conduct that promote better labor standards without enforcement obligations.
    • Transnational Employee Representation: Opportunities for workers to represent their interests across countries, including works councils and international union cooperation on labor issues.

  • Conclusion and Implications

    • Globalization's complexities call for deeper understanding and examination of the effects of free trade on equitable labor practices.
    • Critical thinking about the intertwined nature of efficiency and equity in the global labor market is essential for future discussions and policy considerations.