PSCI 2106 Lecture Notes - Lecture 2: Sports Equipment, Free Trade, North American Free Trade Agreement
Document Summary
The economics: the links between trade --and globalization more generally-- development and poverty. The politics: institutions of world trade and the debate about the wto. The post-wwii period has seen high growth, but trade has grown even more rapidly. But as a whole, developing countries have seen an expansion of trade in the 2000s. Producers of raw materials and low labor costs have benefited from rising prices. Higher level of exports (i. e. exports/gdp) appears to be associated with higher gdp. But trade also operates in way that favors certains groups over others, And this is one source of controversy over globalization. Countries differ in their endowments which leads to different factors of production and advantages. Whoever has the lowest opportunity cost/comparative advantage to produce goods and services. Factors of production: human and physical capital, land, natural resources, . We can draw economies on the basis of scarcity or abundance of various factors. Countries take advantage of their most abundant factor.
