Homework Clinic
Social Science Clinic => Economics => Topic started by: laurencescou on Jun 29, 2018
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a. Define the term globalization.
b. Describe the benefits of globalization.
c. Who is likely to oppose globalization and why?
What will be an ideal response?
Question 2
Compared to the previous 20 years, productivity growth in the United States increased between 1996 and 2014.
Indicate whether the statement is true or false
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Answer to Question 1
a. Globalization refers to the process of countries becoming more open to foreign trade and investment.
b. The benefits of globalization include: (1 ) consumers have access to a wider array of goods and services at lower prices than under autarky; (2 ) trade permits a far more efficient allocation of resources than is possible under autarky; (3 ) specialization in production leads to productivity gains which raise a nation's standard of living.
c. Opposition to globalization comes from three sources: (1 ) firms and workers harmed by globalization. The revenues and profits of domestic firms that produce the same goods and services that are imported will fall and some workers may lose their jobs; (2 ) those who fear that low-income countries are at risk of losing their cultural identity as multinational corporations sell western goods in the markets of these countries; (3 ) those who are concerned that multinational corporations will relocate factories in low-income countries to take advantage of low-cost labor while disregarding the interests of these countries (e.g., noncompliance with environmental standards) and its citizens (e.g. hiring child labor).
Answer to Question 2
FALSE