Globalization and Development Final
Exam Questions
Course Introduction
This course explores the complex relationship between globalization and development, examining how global economic, political, and cultural processes influence social and economic transformation in developing countries. Topics include the drivers and consequences of globalization, the roles of international institutions, trade and investment patterns, migration, technology transfer, and the impact of globalization on inequality, poverty, and sustainable development. Through case studies and theoretical frameworks, students will critically analyze both the opportunities and challenges that globalization presents for development policy and practice around the world.
Recommended Textbook
International Political Economy 5th Edition by Thomas Oatley
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16 Chapters
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720 Flashcards
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Page 2
Chapter 1: International Political Economy
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Sample Questions
Q1) In the international trade system,each WTO country gains access to all other WTO members markets on equal terms.
A)True
B)False
Answer: True
Q2) International Political Economy (IPE)primarily studies
A) the political battle between nation-states.
B) the economic battle between producers and consumers.
C) how the consequences of global economic exchange generate political winners and losers in national and international arenas.
D) how the consequences of global political change generate new technologies.
E) how the consequences of global economic change generate new political cultures.
Answer: C
Q3) Global economic forces play a larger role in determining most peoples' career opportunities than thirty years ago.
A)True
B)False
Answer: True
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Chapter 2: The World Trade Organization and the World Trade System
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Sample Questions
Q1) The multilateral trade system is an international political system because
A) it provides rules that regulate how governments can use policies to influence the cross-border flow of goods and services.
B) it does not tell governments how they use policies to influence the cross-border flow of goods and services.
C) it does not reflect the differential power between developed and developing countries.
D) it does not try to enhance the efficiency of the world trade system.
E) it did not strengthen the growing interests of Europe and Japan during the Cold War.
Answer: A
Q2) The WTO reduces the impact of raw power on international trade relations because
A) it does not bring the rule of law to bear in international trade relations.
B) it does not provide a dispute-settlement mechanism that allows governments to enforce common rules.
C) it brings the rule of law to bear in international trade relations.
D) it does not reflect the interests of the most powerful political systems.
E) it promotes discriminatory international trade.
Answer: C
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Chapter 3: The Political Economy of International Trade Cooperation
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Sample Questions
Q1) The Hecksher-Ohlin trade model argues that
A) developed countries have the same basic factor endowments.
B) developed countries have the same comparative advantages.
C) developed countries have a lot of capital but little labor.
D) comparative advantage arises from differences in factor endowments.
E) comparative advantage arises from similarities in factor endowments.
Answer: D
Q2) Governments are more likely to capture a larger share of the available gains from an agreement if
A) they are the least willing to wait.
B) they are unwilling to risk a breakdown of negotiations.
C) they don't have outside options.
D) they threaten brute force.
E) they are the most willing to wait.
Answer: E
Q3) Production and consumption will occur where the production possibility frontier and the indifference curve are parallel.
A)True
B)False
Answer: False
Page 5
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Chapter 4: A Society-Centered Approach to Trade Politics
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Sample Questions
Q1) The society-centered approach does not address the motivations of noneconomic actors in trade politics.
A)True
B)False
Q2) The factor model predicts that
A) labor will prefer protectionist trade policies in developing countries.
B) owners of capital will prefer liberal trade policies in developing countries.
C) labor will prefer will prefer liberal trade policies in developed countries.
D) owners of capital will prefer liberal trade policies in developed countries.
E) owners of capital will prefer protectionist trade policies in developed countries.
Q3) In a two-factor model,the emergence of conflict between workers and capitalists is based on the assumption that in America
A) labor is homogeneous.
B) trade reduces the income of high skill workers.
C) high skill workers are more abundant.
D) trade increases the income of low skill workers
E) low skill workers are more abundant.
Q4) What are the weaknesses of the society-centered approach to trade politics?
Q5) Explain the similarities between collective action and public goods problems.
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Chapter 5: A State-Centered Approach to Trade Politics
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Sample Questions
Q1) The logic of infant industry protection was first developed to
A) improve the growth of German industries in competition with American ones.
B) improve the growth of American industries in competition with British ones.
C) improve the growth of Japanese industries in competition with American ones.
D) improve the growth of American industries in competition with Japanese ones.
E) improve the growth of American industries in competition with German ones.
Q2) Explain how government R&D subsidies and procurement policies affected strategic trade rivalries in the semiconductor and commercial aircraft industries between the US,Japan & the EU in the past thirty years.
Q3) The infant industry case for protection argues that
A) long term gains will be greater than short term losses.
B) short term losses will be greater than long term gains.
C) long term losses will be greater than short term losses.
D) short term losses will be greater than long term losses.
E) long term gains will be greater than short term gains.
Q4) Countries losing high-technology industries as a consequence of the industrial policies pursued by other countries often respond by supporting their own firms in a similar way.
A)True
B)False
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Chapter 6: Trade and Development I: Import Substitution
Industrialization
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Q1) Explain the costs and benefits of the two-stage strategy of import substitution industrialization.
Q2) Explain how landowner dominated politics prior to WW II differed considerably across regions in the developing world.
Q3) The Singer-Prebisch theory argues that developing countries' terms of trade deteriorate steadily over time because of
A) greater demand for primary commodities versus industrial goods.
B) higher costs of primary commodities versus industrial goods.
C) less demand for industrial goods versus primary commodities
D) greater government protection for primary commodities versus industrial goods.
E) less demand for primary commodities versus industrial goods.
Q4) Trade and development policies in developing countries after WW I have been strongly shaped by political competition between former colonial and nationalist agriculture.
A)True
B)False
Q5) Explain the importance of terms of trade in Singer-Prebisch theory.Has research confirmed these hypotheses?
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Chapter 7: Trade and Development II: Economic Reform
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Q1) Explain the success of the three pillars of China's economic reforms in spite of the inefficient state-owned sector that still employs tens of millions of people.
Q2) The adoption of neoliberal reforms in the developing world has
A) not altered the dynamics of global economic exchange.
B) resulted in the capital-intensive aspects of production now shifting to developing societies.
C) resulted in the labor-intensive aspects of production being shifted to developing societies.
D) brought substantially higher incomes to almost all groups.
E) resulted in larger incomes redistributed among structuralist groups.
Q3) ISI policies in the long run constrained the ability of governments to implement reforms because
A) they created too many veto players to block change.
B) they raised consumer expectations to unreasonable levels.
C) they raised producer profit expectations to unreasonable levels.
D) state owned enterprises became too corrupt to manage.
E) government subsidies were too popular with urban elites.
Q4) How did Asian governments implement policies that encouraged exports?
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Page 9
Chapter 8: Multinational Corporations in the Global Economy
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Sample Questions
Q1) According to the Oatley book, the United Nations (UN)estimates that MNCs currently
A) account for 1/4 of global exports and employ some 57 million people worldwide.
B) account for 1/3 of global exports and employ some 77 million people worldwide.
C) account for 1/3 of global exports and employ some 107 million people worldwide.
D) account for ½ of global exports and employ some 107 million people worldwide.
E) account for ½ of global exports and employ some 117 million people worldwide.
Q2) According to Table 8.1 in the Oatley book,the region of the world with the highest foreign direct investment <u>inflows</u> in 2007-2008 was
A) The European Union.
B) North America.
C) Southeast Asia.
D) Latin America.
E) Africa.
Q3) Describe,explain and give examples of the differences between horizontal and vertical integration of the activities of MNCs.
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Chapter 9: The Politics of Multinational Corporations
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Sample Questions
Q1) Discuss how expropriation of MNCs during the 1960s and 1970s served both political and economic objectives in developing countries.
Q2) Sovereign wealth funds (SWFs)are
A) royalty-owned funds that purchase private assets in foreign markets.
B) royalty-owned funds that purchase public assets in foreign markets.
C) government-owned funds that purchase public assets in domestic markets.
D) government-owned funds that purchase private assets in domestic markets.
E) government-owned funds that purchase private assets in foreign markets.
Q3) In the immediate postwar era,according to Oatley,the fifteen largest agricultural MNCs controlled approximately
A) 10% of developing countries' exports.
B) 30% of developing countries' exports.
C) 50% of developing countries' exports.
D) 80% of developing countries' exports.
E) 95% of developing countries' exports.
Q4) No matter how "globalized" the world economy becomes,economic production will always employ resources drawn from local communities.
A)True
B)False
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Chapter 10: The International Monetary System
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Sample Questions
Q1) The Bretton Woods system
A) represented the first time that governments explicitly made exchange rates a matter of international cooperation.
B) was a form of floating exchange rates.
C) was not fully implemented until 1949.
D) was an attempt to limit domestic economic autonomy after WW II.
E) was unsuccessful at establishing exchange rate stability in spite of rapid growth in international trade after WW II.
Q2) Which of the following innovations was not introduced by the Bretton Woods system?
A) Greater exchange-rate flexibility
B) Capital controls
C) A stabilization fund
D) The IMF
E) The World Bank
Q3) What is "dollar overhang" and how did it threaten the stability of the Bretton Woods system?
Q4) Why do we live in a world where currencies are so unstable?
Q5) What role has the gold standard played in currency exchange systems since 1870?
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Chapter 11: Cooperation, conflict and Crisis in the Contemporary International Monetary System
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Sample Questions
Q1) Foreign government holdings of American government debt rose from approximately
A) $350 billion in 1999 to $1.3 trillion in 2008.
B) $500 billion in 1999 to $2.0 trillion in 2008.
C) $750 billion in 1999 to $2.5 trillion in 2008.
D) $1.5 trillion in 1999 to $3.0 trillion in 2008.
E) $750 billion in 1999 to $3.3 trillion in 2008.
Q2) By the end of the 1980s,American foreign debt to the rest of the world had increased from
A) $ 140 billion to more than $ 1 trillion.
B) $ 440 billion to more than $ 2 trillion.
C) $ 200 billion to more than $ 3 trillion.
D) $ 350 billion to more than $ 2 trillion.
E) $ 750 billion to more than $ 2 trillion.
Q3) The massive use of credit default swaps
A) reduced the risk of nationwide collapse of real estate prices.
B) created mortgage-backed securities with different risks.
C) created a global savings glut.
D) reduced the risk of regional collapse of real estate prices.
E) allowed the Bush tax cuts of 2001.
Page 13
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Chapter 12: A Society-Centered Approach to Monetary and Exchange-Rate Policies
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Sample Questions
Q1) The Philips curve is based on a tradeoff between
A) inflation and unemployment.
B) deflation and unemployment.
C) inflation and budget deficit.
D) unemployment and trade deficit.
E) inflation and imports.
Q2) Compare and contrast the similarities of the sectoral model of monetary and exchange-rate politics with the electoral and partisan models.
Q3) Between 1995 and 2001,the dollar rose in value against America's largest trading partners by
A) 10%.
B) 15%.
C) 20%.
D) 25%.
E) 30%.
Q4) The partisan model of monetary and exchange-rate politics is based on a trade-off between unemployment and inflation.
A)True
B)False
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Chapter 13: A State-Centered Approach to Monetary and Exchange-Rate Policies
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Sample Questions
Q1) During the 1970s and 1980s,and even as late as the mid-1990s,European governments used monetary policy to pursue their particular economic policy goals which typically reflected the interests of their domestic interest groups.
A)True
B)False
Q2) According to Oatley's data in chapter 13,which plots data for 1969-1995,the countries with the highest and lowest inflation rates respectively were
A) Norway and Japan.
B) Italy and Germany.
C) Britain and Austria.
D) France and Canada.
E) Japan and Germany.
Q3) According to Oatley,granting the central bank independence should lead to
A) short-term lower inflation.
B) short-term lower unemployment.
C) short-term political convenience.
D) long-term higher economic growth.
E) long-term higher unemployment.
Q4) Are independent central banks compatible with democratic principles?
Page 15
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Chapter 14: Developing Countries and International
Finance I: the Latin American Debt Crisis
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Sample Questions
Q1) The foreign debt of the seven most heavily indebted Latin American countries between 1970 and 1982 increased by a factor of A) five.
B) seven.
C) ten.
D) twelve.
E) fifteen.
Q2) Creditors were able to push such a large share of the adjustment costs onto the debtor governments because
A) debtor governments were better at maintaining a common front.
B) creditors were better able to solve the free rider problem better than debtors. C) smaller banks had lent less of their capital.
D) larger banks could charge their losses to taxpayers in advanced industrial countries.
E) the IMF threatened to make it difficult for the smaller banks to operate in the interbank market.
Q3) Explain the rationale and consequences of structural adjustment programs on the economic crisis for Latin America in the early 1980s.
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Page 16
Chapter 15: Developing Countries and International
Finance II: a Decade of Crises
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Q1) Explain the conditions under which the HIPC initiative developed and changed in response to the debt reduction challenges of the world's poorest countries.Does debt cancellation encourage moral hazard dilemmas by both lenders and governments?
Q2) The Asian financial crisis of 1997 originated in political and economic dynamics in Thailand,Indonesia,South Korea and Singapore.
A)True
B)False
Q3) According to Oatley,historical evidence suggests that more volatile capital flows have been associated with
A) higher economic growth rates over the short run.
B) higher economic growth rates over the long run.
C) lower economic growth rates over the long run.
D) lower economic growth rates over the short run.
E) boom- and-bust growth rates over the long run.
Q4) IMF assistance in the Asian financial crisis of the 1990s was conditional upon economic reform.What were these reforms and how did they affect Thailand and Indonesia differently?
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Chapter 16: Globalization: Consequences and Controversies
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Q1) According to Oatley,the current consensus among globalization defenders and environmentalists suggests that globalization can have positive environmental consequences.
A)True
B)False
Q2) Discuss the costs and benefits of the efforts to create global rules to improve working conditions and wages in sweatshop factories.
Q3) Discuss and explain how globalization has both positive and negative scale and structural effects on the environment.
Q4) According to Oatley,globalization has a real public-relations problem that has been created by the antiglobalization movement based on,in many instances,factually incorrect claims.
A)True B)False
Q5) According the defenders of globalization and Oatley,globalization is the solution to the problems of income inequality and poverty,not their cause.
A)True B)False
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