Class Notes (806,431)
Canada (492,249)
POL208Y1 (477)
C Jung (7)

POL208 Jan.28th 2013.docx

4 Pages
Unlock Document

University of Toronto St. George
Political Science
C Jung

A race to the bottom? Capital is more free to cross borders, it has option to exit also. You can have less unions but it pushes countries to compete for investment which pushes us to less protection, less security, etc. You have more influence on state policies if you own capital. Realism & mercantilism is that the state is the only important actor in economic relations. The State and the MNC -Is the state becoming powerless? -what are the ethical implications? -does it force us to re-evaluate the winners/losers and with it the theory of free trade? -Anti-Globalization: collection of different interest groups with a variety of concerns and agendas; focus on redistribution, externalities, democracy -Regulation from below? Through our own behaviour as consumers we can vagulate some of these issues. Do you pay for cheap coffee, or more expensive coffee where more profit goes to the farmer? -Is there an alternative? Roderik’s Trilemma (imagine a triangle) economic integration(top) Nation state (bottom left) mass politics(bottom right) We get something but we lose something else, we can never have everything we want. Economic trade & nation state = race to the bottom. If we choose to open up everything and still maintain borders, capital can leave and threaten the gov’t so gov’t loses their ability to respond to their own citizens. We lose mass politics. Trade off: a growing dramatic deficit. Economic integration & mass politics = global federalism. if we stop caring about national borders. Trade off: We lost the nation state. If we had world federal system who will run the country? Nation state & mass politics = Bretton woods. Giving up some levels of integration, Bretton woods was a compromise, allows states to keep their own capital markets closed. Trade off: limited economic integration. -A rising tide lifts all boats? Factor Price Equalization Economic theory that leads us to believe that a rising tide lifts all boats. -When market forces are allowed to work and compete freely they will push towards equilibrium -Factor price equalization theorem (samuelson): free trade will eliminate price differences for commodities across countries; subsequently the prices of the factors of production related to those commodities (capital and labour) will also equalize. If the price of a book in CAN and USA becomes equal the price for producing the book will become equal over time we will reach an equilibrium. NAFTA, lower wages in Mexico, factory would be built in Mexico, -for example: following the implementation of NAFTA unskilled labour wages gradually fell in the USA, at the same time as they gradually rose in Mexico. Some stats about Africa -65% live on under $1 a day -40% don’t attend primary school -28m have HIV/AIDS -average GDP per capita of $420 Modernization Theory (how do we explain what happens in Europe and in Africa?) -An optimist theory that predicted post-colonial growth and development -Industrialization->urbanization->rise of middle classes->democracy and adoption of modernity- >growth -the new countries will follow an accelerated version of European model of modernization -minimal gov’t intervention;free trade (we want the liberal model to kick in and allow societies to develop) -in practice; stagnation; a series of coups; instability; economic decline Salvaging the modernization theory -the theory is valid but the countries failed its prescription and hence flopped. The “blame” is with local conditions in the LCD’s. -economic policies -institutions -wars -natural environment Economic Policies I -Import substitution industrialization (
More Less

Related notes for POL208Y1

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.