Assignment 1: The United States In A Global Economy

Chapter 1
The United States in a Global Economy
.1  Outline
Introduction
Globalization in Perspective
The Growth of World Trade
Capital and Labor Mobility
New Features of the Global Economy New Issues in International Trade and Investment The Role of International Organizations Regional Trade Agreements
Trade and Economic Growth
Twelve Issues in the International Economy
The Gains from Trade
Wages, Jobs, and Protection
Trade Deficits
Regional Trade Agreements
The Resolution of Trade Conflicts
The Role of International Institutions
Exchange Rates and the Macroeconomy
Financial Crises and the Global Contagion
Capital Flows and the Debt of Developing Countries
Crisis and Reform in Latin America
Export Led Growth in
8. Describe the three kinds of evidence economists use to support the assertion that open economies grow faster than economies that are closed to the word economy.
Answer: These are: (1) casual empirical evidence of historical experience; (2) economic logic and deductive reasoning; and, (3) evidence of statistical comparisons of countries.
(1) The historical evidence examines the experiences of countries that tried to isolate themselves from the rest of the world. First, not only did trade protection exacerbate the depression of the 1930s, but it also led to the misery and tragedy of World War II. Second, an examination of countries such as the former West and East Germany,
South and North Korea, and other countries with the same historical, economic, and ethnic background that were divided by war, indicate that those who closed their economies from the rest of the world suffered in terms of prosperity and environmental degradation. East Asia experienced an economic take-off when it decided to integrate with the rest of the world, while Latin America, which had the same economic background with East Asia but chose to remain partially closed, experienced mediocre