International political economy correct answers combined political and economic behaviors among state and non-state actors in global society (transcends state boundaries)
Paradigm's Approach to Political Economy correct answers 1. realism emphasizes role of state
2. liberalism focuses on limi...
International political economy correct answers combined political and economic
behaviors among state and non-state actors in global society (transcends state
boundaries)
Paradigm's Approach to Political Economy correct answers 1. realism emphasizes role
of state
2. liberalism focuses on limits of state powers and tendency for them to redefine
national interests in context of changing int eco conditions
3. radicalism do not expect social harmony to be achieved by indiv of different classes
(class-based conflict will prevail)
Realist Approach to Political Economy correct answers 1. emphasize the role of the
state in the global economy
2. state is guarantor of economic power, non-state actors have minimum impact
3. MNCs, IGOS, and NGOs have most impact when promote national interests of most
powerful states
4. foreign eco policy designed to maximize state power and wealth → states weary of
politics to diminish position in global hierarchy→ potential conflict
5. States pursue relative gains
6. neo-mercantilism: state attempts to maximize its relative economic power in the
global economy
7. thinks global economy is constraint on freedom of state and source of vulnerability
relative gains correct answers realists focus on the conditions in which one state in an
economic interdependence interaction may benefit more than another, resulting in a
potential threat to a state's security later on
ex: US creating its own nemesis by relying on China
Mercantilism correct answers 1. Economic philosophy of 16th-18th century European
nations
2. sees best way for state to maximize wealth and to reduce vulnerability is to actively
encourage (maximize) exports and discourage (minimize) imports to form a trade-
surplus of hard currency
3. modern mercantilists emphasizes state's ability to maximize it's relative economy
power in global eco and to command control of resources to ensure state security
(realist)
Liberalist Approach to Political Economy correct answers 1. optimistic view
2. transnational view of international relations
3. See potential harmony and int economic cooperation
4. emphasize the relative importance of non-state actors in the global economy.
,- MNCs and IGOs have a great deal of influence in the world economy.
5. benefits of economic interdependence promote gains for all states that participate,
these absolute gains emphasized
6. neo-liberalism
7. states with an economy engaged in world trade grants it the resources it needs to
protect security interests
8. global economy offers opportunities for functionalism cooperation
9. global economy is vehicle for reducing interstate conflict (disruption in eco due to
conflicts will add additional costs to war)
absolute gains correct answers 1. conditions in which all participants in exchanges
become better off
2. liberals believe states pursue absolute gains, rather than relative gains during eco
interdependence
neo-liberalism economics correct answers 1. emphasizes the benefits of free market
economics, with limited state interference.
2. Adam Smith
Radical Approach to Political Economy correct answers 1. believe that the international
political economy is fundamentally exploitative
2. international economic order reflects the interests of economic elites and
consequently benefits developed powerful states and the expense of less developed
states
3. modern radicals less sure that the international capitalist system is inherently
unstable, the way earlier researchers did.
4. see IPE as creator of weaker state dependence, not interdependence
problems with interdependence correct answers 1. contributes to problem and creates
necessary conditions for order
2. participating in global economy is beneficial, but also exposes actors to disruptions
- sensitivity and vulnerability
3. Westphalian system faces new challenges in dealing with its complexities
(sovereignty and interdependence don't mix)
Interdependence correct answers 1. A system made of the relationships between
countries in which they rely on one another for resources, goods, or services
2. Ability to create order depends on state's interdependence
economic interdependence correct answers a condition in which countries have strong
economic ties and depend on each other for resources, technology, trade, and
investment
sensitivity correct answers means how much and how quickly changes that occur in the
global economy can affect an actor
, vulnerability correct answers 1. the costs imposed upon an actor on account to
exposure to disruptions from the global economy.
2. "what can you do about the disruptions?"
example of vulnerability correct answers Asian Financial Crisis
- disruptions began in Thailand and spread throughout the region
- some states hurt more than others
Comparative advantage correct answers 1. The ability of a country to produce a good
at a lower cost than another country can.
2. benefits of specializing in goods that a state can produce relatively efficiently, even if
that state is not the most efficient producer in an absolute sense
Absolute advantage correct answers a state is superior in the ability/efficiency to
produce a good using fewer inputs than another producer
Why trade is good correct answers 1. Specialization of each trading partner helps raise
productivity
2. ex: you are on an island. "I'll gather coconuts, you make the huts → we become more
efficient."
Autarky correct answers 1. economic independence or self-sufficiency
2. policy to minimize trade in favor of domestic productions of all goods required by
society
3. not cost-effective
4. but states are sometimes isolated by choice, by imposition of sanctions, or
imperialism
example of Autarky correct answers 1. Germany during the world wars
2. South Africa during apartheid
3. Iraq under Saddam Hussein
4. Burma due to ideology
5. Japan isolationism during WII
6. US during depression
free trade and autarky are... correct answers on opposite ends of spectrum for trade
practices → in between are varying degrees of protectionism
protectionism correct answers policy of restricting, but not eliminating, imports in an
effort to maintain or nurture the economic viability of domestic industries
How could protectionism possibly be bad? correct answers 1. when different industries
within an economy impose trade barriers on imports to reduce competition →
consumers pay more in higher prices
2. in effect, prices are raised and potential productivity is lowered by not allocating
productive resources to where they can be best used
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