POLD89H3 Study Guide - Special Drawing Rights, Foreign-Exchange Reserves, Maastricht Treaty

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23. Mercosur: Established in 1991 and updated in 1994, it is the free trade
agreement between Uraguay, Paraguay, Brazil, and Argentina and has welcomed
other nations, including Peru, Bolivia, Chile, Columbia, Ecuador, and in 2006,
Venezuela. The trading blocr nations have only partial membership in the trade
agreement. Mercosur has lowered tariffs for all member nations, but most notably
in 2005 for Columbia, which is now able to bring products and services to more than
200 million people who would not have had access previous to Mercosur.
24. MNC’s: Multinational corporations (MNCs) in their most basic sense are firms that
not only export their products to other countries but have also established sourcing
supplies of materials, production, marketing, and managerial operations in countries
other than their home base. The basic idea is not new but in recent years MNCs have
become so big and powerful that authors such as Hertz (2001) argue they may be a
threat to democracy.
25. Multilevel Politics: many authoritary structures at work in the emergent global
political economy, found in the EU with the development of the Maastricht Treaty
26. North Atlantic Treaty Organization / NATO: Head quarters location in Belgium
and Brussels consisting of an organization constituting a system of defense. Increased
ties with the United States.
Sovereignty The condition of a state being free from any higher legal authority. It is
related to, but distinct from, the condition of a government being free from any external
political constraints.
It involves the entitlement to exclusive, unqualified, and supreme rule within a delimited
It is the founding covenant of world politics. Many argue that contemporary globalization
presents a fundamental challenge to the Westphalian ideal of sovereign statehood and
in so doing is transforming world order. The current notion of state sovereignty is often
traced back to the Treaty of Westphalia (1648), which, in relation to states, codified the
basic principles of territorial integrity, border inviolability, and supremacy of the state
(rather than the Church).
Special Drawing Rights International foreign exchange reserve assets. It is allocated
to nations by the International Monetary Fund. It represents a claim to foreign
currencies for which it may be exchanged in times of need. The US Dollar is the worlds
primary foreign exchange reserve asset today therefore Special Drawing Rights are
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not used as much. Special Drawing Rights are also the International Monetary Funds
unit of account (SDR’s).
Structural Funds Funds allocated by the EU as parts of its regional policy. Structural
Funds are made up of the European Regional Development Fund (ERDF) and the
European Social Fund (ESF). It aims to reduce regional disparities in terms of income,
wealth and opportunities. Europe's poorer regions receive most of the support, but all
European regions are eligible for funding under the policy's various funds and
Samuel Huntington An American political scientist who is known for his thesis of a
post-cold war new world order. “Huntington argues that, as societies modernize, they
become more complex and disordered. If the process of social modernization that
produces this disorder is not matched by a process of political and institutional
modernization—a process which produces political institutions capable of managing the
stress of modernization—the result may be violence.
19-Just War Tradition (JWT) (pg.201, 288)
-is a set of guideline for determining and judging when states may have an option to go
-JWT also applies moral limits in war, which include limiting harm that sates can commit
against other states (civilians)
-consists of two parts which are: jus ad bellum (justice of war) and the jus in bello (the
justice in war)
-the bellum means the occasion of going to war, and the bello refers to the means,
weapons and tactics used in war
-JWTs aim is to limit wars by restricting the types of justification that are acceptable
20-Least Developed Countries (LDC’s)
-LDC’s are countries which have low development and has a low human development
index rating
-in 2009, there were 49 countries classified as LDC
21- Maastricht Treaty (pg. 45, 552)
-signed in February 1992, creation of the European Union,
-Treaty was about the European community and monetary money ( the euro)
-Treaty also included two pillars which were Common Foreign and Security Policy
(CFSP) and Justice & Foreign Affairs
-the community was given some powers in the fields of education, youth, culture and
public health
-role of European Parliament was enhanced though a co-decisions’ procedure that
required its approval as well as that of the council for laws
-every person who is a citizen of one of the member states of the EU is a citizen of the
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-is an economic theory that there is fixed amount of wealth in the world
-says the nations prosperity depends on its own success in exporting more than it
11. Great Depression* - The Great Depression was a worldwide economic downturn
starting in most
places in 1929 and ending at different times in the 1930s or early 1940s for different
countries. It
was the largest and most important economic depression in the 20th century, and is
used in the 21st century as an example of how far the world's economy can fall. The
Great Depression originated in the United States; historians most often use as a starting
date the stock market crash on October 29,1929, known as Black Tuesday. The
depression had devastating effects in virtually every country, rich or poor. International
trade plunged by half to two-thirds, as did personal income, tax revenue, prices and
profits. Cities all around the world were hit hard, especially those dependent on heavy
industry. Construction was virtually halted in many countries. Farming and rural areas
suffered as crop prices fell by roughly 60 percent. Facing plummeting demand with few
alternate sources of jobs, areas dependent on primary sector industries such as
farming, mining and logging suffered the most. It was triggered by a certain total
collapse in the stock market.
a. The global economic collapse beginning 1929, lasted until the late 1930's to early
b. Following the US Wall Street stock-market crash in October 1929 (Black Tuesday).
c. Even in 1929, foreign investment and trade were interconnected via the global
d. Virtually every country was affected ± rich and poor.
e. Personal income, profit, revenue, construction and international trade all dropped
f. Unemployment skyrocketed (25-33% unemployment, depending on country).
g. Ended just prior to WWII
h. Can be used to demonstrate how far the world's economy can decline and how
interconnected the world economy is.
12. Humanitarian Intervention - The act of one or more states of the international
intervening in the affairs of a sovereign state due to a states lack or collapse of
government, leading
to a large-scale loss of life or genocide;
a. The United Nations Security Council is an international organization responsible for
the protection of
human rights and has the power to authorize military intervention.
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