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Economic Globalization - Coggle Diagram
Economic Globalization
Breton Woods Conference
This was a conference held among 44 nations to agree on a monetary system that supports international trading. This was developed by the implementation of a fixed exchange rate and the gold standard.
Positive Effects: The World Bank was created to help developing countries grow economically. The International Monetary Fund (IMF) was also created to monitor exchange rates and fund short term financial support to member countries.
World Bank
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Negatives: It might support developed countries such as China despite China's poor human rights record, more than poorer countries.
IMF
Positive Effects: The IMF analyzes each country's economy and discusses it with their leaders. It also reduces poverty by loaning money to developing member countries.
Negative Effects: Austerity programs advocated by the IMF can increase taxes and take away social programs. Countries like America can control the IMF to support their corporations more than underdeveloped country's interests. The IMF has little power and is more of a funding agency and doesn't look to make social changes.
Negative Effects: Nations printed too much money and created inflation. This came from an accumulation of debt and lead to a loss in value of their currency.
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Free Market
At the end of the Cold War, countries began to look towards the U.S with their free market. Countries accepted capitalism and outsourcing became more popular.
Effects: Capitalism brought competition among businesses and supplies consumers with a variety of goods. However local businesses are sometimes passed off for larger corporations as they are typically cheaper from outsourcing.
Friedrich Kayek
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Effects: Countries accepted this belief and appreciated the freedom for consumers and businesses to decide for themselves.
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John Keynes
He believed governments need to intervene to regulate the economy. During times of crisis, government can spend more to boost the demand for goods and services. This would take businesses out of recession.
Effects: Countries adopted this theory and created a welfare orientated form of capitalism. However, over time this no longer became the wildly accepted way for government to be involved in the economy in some countries.
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Transnationals
Corporations that are in multiple countries. For example, Pepsi, Apple, and Nike. These companies often have headquarters in one country and the production of products in another.
Negative Effects: Workers are often mistreated and given little pay for long hours. Their industry is a leading contributor to climate change.
Positive Effects: There are lots of job opportunities created from large corporations. An interconnectedness between countries and relationships for trade are established as well.
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