PSCI 150 Lecture Notes - Lecture 22: William Jennings Bryan, Foreign Portfolio Investment, Bimetallism
13 Dec 2017
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Global distribution, effects of trade on voting, comparative advantage: everyone should be in favor of free trade (*but there"s individuals that don"t benefit, abundant factor, different factors: land, (relatively unskilled) labor, and capital. Investment in stocks, bonds, and other easily tradeable securities. If you see other people running to the bank, you"ll run too. Insolvent: if everyone shows up, bank will collapse: quick/effective capital mobility gives investors power, 2 types of financial crises, sovereign debt (argentina, currency crisis, fixed exchange rate reduces this risk and promotes trade, mexico in 92. Imf: countries maintain fixed exch rate while limiting mobility: takes money from developed countries, can give money to countries ec, discourages speculative attacks, trade deficits, 1. Us trade deficit has been persistent and large: 2. Trade deficit reflects the strong dollar: 3. Trade def can trigger a balance of payments crisis: europeans running out of silver bc of trade in china, led to reliance on opium, 4.
