Chapter 16: The Achievements of and Challenge to the Global Capitalist Economy

Multiple Choice Questions

1. According to Oatley, what binds the anti-globalization movement is opposition to a global economy that they believe prioritizes a) advanced industrial country interests over developing country interests. b) Asian economic development over other developing regions. c) economic interests over security concerns. d) corporate and commercial interests over other concerns. e) political interests over economic interests.

Answer: d a) anti-trade, anti-immigrant, racist, anti-elite, and nationalist. b) pro-trade, anti-immigrant, racist, pro-elite, and nationalist. c) anti-trade, anti-immigrant, anti-racist, anti-elite, and internationalist. d) anti-trade, pro-immigrant, racist, anti-elite, and nationalist. e) anti-trade, pro-immigrant, anti-elite, and socialist.

2. According to Oatley, globalization is challenged from within by neo-populist movements that are stridently.

Answer: a

3. Soviet-style Marxism-Leninism persisted on into the postwar era, it too largely ceased to offer an appealing alternative model and a) had disappeared entirely by 1970. b) had disappeared entirely by 1975. c) had disappeared entirely by 1980. d) had disappeared entirely by 1985. e) had disappeared entirely by 1990.

Answer: e

4. According to World Bank data, global per capita income increased by an additional 86 percent since 2000, a) reaching more than $10,000 by 2010. b) reaching more than $10,000 by 2017. c)reaching more than $15,000 by 2017. d)reaching a little less than $9,000 by 2017. e)reaching a little less than $8,500 by 2017.

Answer: b

5.Recent research suggests that the pandemic increased the percentage of the population living in extreme poverty increasing to a)9.0 percent in 2020 and 8.8 percent in 2021. b) 9.1 percent in 2020 and 8.9 percent in 2021 c)9.2 percent in 2020 and 9.0 percent in 2021 d)9.4 percent in 2020 and 9.2 percent in 2021 e)9.9 percent in 2020 and 9.6 percent in 2021.

Answer: d

6.The post-World War II era has been characterized by decolonization such that by a)2000 nobody lived under colonial rule. b)1990 nobody lived under colonial rule. c)1980 nobody lived under colonial rule. d)1970 nobody lived under colonial rule. e)1960 nobody lived under colonial rule.

Answer: b

7.The average person lives twice as long today as she did in 1913 and a)50 percent longer than she did in 1940. b)50 percent longer than she did in 1945. c)50 percent longer than she did in 1950. d)50 percent longer than she did in 1955. e)50 percent longer than she did in 1960

Answer: c

8.In the United States in 2019, for instance, people in the top 1 percent of the income distribution earned on average roughly $1.4 million; in contrast, but the people in the bottom 90 percent of the income distribution earned, on average, a)approximately $22,000. b)approximately $25,000. c)approximately $30,000. d)approximately $33,000. e)approximately $35,000.

Answer: e

9.The potential benefits that science has generated have had a a)similar impact in societies that participated in the global capitalist economy than in those societies that stood outside this system. b)greater impact in societies that participated in the global capitalist economy than in those societies that stood outside this system. c)lesser impact in societies that participated in the global capitalist economy than in those societies that stood outside this system. d)greater impact in societies that did not participate in the global capitalist economy than in those societies that stood outside this system. e)greater impact in societies that participated in the global capitalist economy than in those societies that stood for nationalism.

Answer: b

10.Although global per capita incomes have increases and income inequality globally has fallen, a)wealth and income have also become increasingly equal within many societies. b)wealth and income have also become increasingly unequal within many societies. c)wealth and income have also become increasingly equal within advanced industrial societies. d)wealth and income have also become increasingly equal within developing societies. e)wealth but not income have also become increasingly unequal within many societies.

Answer: b

11.The Stolper-Samuelson Theorem tells us that in the American economy we would expect free trade to a)increase the return to physical and human capital and reduce the return to labor. b)increase the return to labor and reduce the return to physical and human capital. c)increase the return to physical and human capital and maintain the return to labor. d)lower the return to physical and human capital and reduce the return to labor. e)increase the return to physical and human capital and labor.

Answer: a

12. “Skill biased technological change”, is a process wherein a)technology substitutes for medium-skill workers. b)technology substitutes for high workers. c)technology substitutes for agricultural workers. d)technology substitutes for urban workers. e)technology substitutes for low-skill workers.

Answer: e

13.Peter Temin has recently argued that the US economy has evolved into a dual economy which is: a)one high-wage economy and one low-wage economy and many connections between them. b)one high-wage economy and one low-wage economy and very few connections between them. c)one high-wage economy and one medium-wage economy and very few connections between them. d)one medium-wage economy and one low-wage economy and very few connections between them. e)one high-wage economy and one low-wage economy and very few international connections between them.

Answer: b

14.The 2008-2009 financial crisis and the policy response a)imposed new burdens on the segment of society that were the least exposed to the downsides of globalization. b)imposed new advantages on the segment of society that were already most exposed to the downsides of globalization. c)imposed new burdens on the segment of society that were already most exposed to the advantages of globalization. d)imposed new burdens on the segment of society that were already most exposed to the downsides of globalization. e)imposed new advantages on the segment of society that were already benefiting exposed to the benefits of globalization.

Answer: d

15.As a political movement, right-wing populism favors policies and programs that are culturally conservative, anti-globalization, anti-immigration, and often antienvironmentalist, including climate change skepticism. defines the elite as corrupt and often too responsive to foreign or cosmopolitan interests and concerns a) culturally conservative. b) anti-globalization. c) anti-immigration. d) are climate change skeptical. e) defines the elite as nationalist.

Answer: e

16. Rodrik’s “Political Trilemma” suggests that governments face three desirable objectives: a) globalization, democratic decision making, and national interdependence. b) regionalism, democratic decision making, and national autonomy. c) globalization, democratic decision making, and national autonomy. d) globalization, populist decision making, and nationalism. e) mercantilism, democratic decision making, and national autonomy.

Answer: c

17. The Bretton Woods compromise that states crafted after World War II a) combined globalization and democratic decision making but sacrificed national political autonomy. b) combined national political autonomy and globalization but sacrificed democratic decision making. c) established national political autonomy but sacrificed globalization and democratic decision making d) combined national political autonomy and democratic decision making but sacrificed globalization. e) established national political autonomy, democratic decision making and globalization.

Answer: d

18. According to Oatley, while many observers question many of the specific details contained in Trump’s approach to trade and the UK’s decision to withdraw completely from the EU, we are seeing a a) growing number of calls to reform and rebalance globalization. b) fewer number of calls to reform and rebalance globalization. c) growing number of calls to isolation and unbalance globalization. d) growing number of calls to reform and reduce globalization. e) fewer number of calls to reform and reduce globalization.

Answer: a

19. Suzanne Berger suggests that “open borders must once again be linked to a broad program of social and fiscal reforms. One policy that is not suggested by Oatley is a) raising minimum wages, b) consolidating national health insurance, c) tax reforms, d) addressing opposition to migration, and

e)tackling the sources of inequality

Answer: d

20.According to Oatley, a)Crafting a 21st century version of the Bretton Woods compromise would certainly be a better outcome than the destruction of unilateralism by globalism. b)Crafting a 21st century version of the Bretton Woods compromise would certainly be a better outcome than the destruction of globalization by unilateralism. c)Crafting a 21st century version of unilateralism would certainly be a better outcome than the compromise of Bretton Woods and globalism. d)Crafting a 21st century version of globalism would certainly be a better outcome than the destruction of unilateralism by the compromise of Bretton Woods. e)Crafting a 21st century version of the Bretton Woods compromise would certainly be a better outcome than the destruction of regional coalitions by unilateralism.

Answer: b a) ignore US-EU cooperation. b) exploit China’s energy power. c) reassert Russian influence over the former Soviet empire. d) oppose authoritarian efforts in Eastern European countries. e) oppose democratic efforts in Eastern European countries.

21. Currently, Putin seems content to disrupt US-EU cooperation, exploit Russia’s energy power, and reassert Russian influence over the former Soviet empire.

Answer: e

22. The idea of weaponized interdependence rests on the recognition that the global economic relationships comprise a) an asymmetric network structure. b) a symmetric network structure. c) global value chains that produce less connection between countries. d) some countries are less connected financially than others. e) some countries are less centrally connected in trade terms than others

Answer: a

23. The ability of states to weaponize a central network position to acquire important and strategically useful information from data that flows through the infrastructure of modern IT of data is known as a) the checkpoint effect. b) the panopticon effect. c) the chokepoint effect. d) the asymmetric network effect. e) the central network effect.

Answer: b; Chap 16: Page: 12; Understanding a) is known as SUDDEN. b) is known as FACTS. c) is known as SWIFT. d) is known as FAST. e) is known as SEATO.

24. A cooperative created and run by and for private financial institutions to transfer payment instructions between institutional counterparties to financial transactions.

Answer: c

25. According to Oatley, contemporary conflict over the global political economy seems to be primarily about a) questioning democracy and markets. b) specific pieces of legislation. c) pandemic management. d) decarbonization. e) supply chain vulnerabilities.

Answer: a

True-False Questions

1. The challengers of globalization believe that all global economic activity has a negative impact on the environment.

Answer: False

2. Total world income has risen much more rapidly during the last 40 years than it did during the nineteenth and first half of the twentieth century.

Answer: True

3. Global income inequality is much greater than domestic income inequality in even the most unequal countries.

Answer: True

4. According to Oatley, rising inequality reflects that fact that some people have not realized gains from globalization that are orders of magnitude greater than the average improvement.

Answer: False

5. Rodrik’s “Political Trilemma” suggests that governments face three desirable objectives. Yet, at any given time, they can realize only two of these three goals.

Answer: True

6. One-quarter of the world’s known lithium deposits lie in Brazil and are already the focus of competition between Russian, Chinese, and American firms.

Answer: False

7. The chokepoint effect concerns the ability to weaponize a central network position to prevent a third party from accessing a critical system for which there is no effective alternative.

Answer: True;

8. According to Oatley, Putin doesn’t desire to alter Russia’s relationship with and position in the contemporary global order.

Answer: False